Bangladesh bids big for raising minimum US$1.5 billion or around Tk 130 billion through auction of radio-frequency allocations to mobile-phone operators to power 5G services and beyond, meant for a quantum leap in telecommunications.
Bangladesh Telecommunication Regulatory Commission (BTRC) has decided on holding the auction on March 31, officials say, with sights set on the returns from the biddings.
Mobile operators, however, appear a bit sceptical of 5G (5th generation) frequency adequacy and seek guidelines first to assess the stakes as the deals involves "huge investment".
"While we have received the spectrum-auction guideline, we are yet to receive the 5G guidelines. In this backdrop, it is quite undesirable to expect that we will make such an important investment decision in almost no time, and that too without even having a look at the 5G guidelines," says Robi Axiata Chief Corporate and Regulatory Officer Shahed Alam.
They, therefore, urge the Commission to first of all share the 5G guidelines with them and then allow sufficient time to prepare for effective participation in the auction process.
"With regard to the spectrum price set for the auction, we've submitted that 5G auction should not be treated in the same manner as 2G, 3G or 4G spectrum. We need to remember that, to launch viable 5G service, we need huge amount of spectrum," he told The Financial Eexpress.
"Given the proposed auction rate, it would be impossible to acquire the amount of spectrum we need to launch 5G in an effective manner," he adds.
The commission has fixed 2.3GHz, 2.6GHz spectrum bands to launch 5G services in the country.
Operators have to launch 5G services within six months from the date of auction of spectrum from 2.3 GHz or 2.6 GHz bands on a "technology-neutral basis," the auction guidelines say.
"Currently, assigned spectrums to the cellular mobile operators are not sufficient to carry the enormous traffic. Therefore, BTRC is planning to award spectrum from 2.3 GHz (2300-2400 MHz) and 2.6 GHz (2500-2690 MHz) bands to the cellular mobile-phone-service operators through auctions for providing 2G, 3G, G/LTE' 5G and beyond (IMT for 2020 and beyond) cellular mobile services," according to BTRC instruction manual for the radio-frequency auction 2022.
The 60 MHz spectrum from 2.3 MHz band will be auctioned in six blocks and 120 MHz spectrum from 2.6 GHz band will be auctioned in 12 blocks.
However, more blocks may be added before the auction, the auction manual reads.
The BTRC spectrum division sources say they are ready to sell a total of 220 MHz being put on sale.
An official of the division says the total earning from the auction might be higher than $US1.5 billion as he foresees "fierce completion" for spectrum.
The applicants will be entitled to participate in the bidding process subject to the submission of bid earnest money amounting Tk100 million.
The auction guidelines set a minimal floor bid price at US$6 million per MHz of spectrum for this auction.
During last auction in 2021, the auction guidelines set a floor bid price of US$30 million per MHz of spectrum in 1800 MHz band and US$27 million in 2100 MHz band.
The bid earnest money was Tk 10 million for the application of each spectrum band, payable in the form of pay order and bank draft, according to the guidelines.
According to the spectrum auction 2022 guidelines, the spectrum will be assigned after payment of 10 per cent of the payable Spectrum Assignment Fee subject to fulfillment of other terms and conditions stipulated in these instructions
The remaining 90 per of the total amount of payable Spectrum Assignment Fee will have to be paid by nine equal installments within nine years from the date of spectrum assignment in US dollar or its equivalent in BDT to be converted at the Foreign Currency selling rate of Bangladesh Bank as on the auction date, the guidelines say.
The remainder is calculated by excluding fees, charges, VAT and taxes imposed by any other competent authority of the government.
BTRC has already assigned 60MHz of spectrum from the 3.5GHz band to the state-owned mobile-operator Teletalk for the launch of 5G services.
The spectrum auction of the telecoms regulator has broken all previous records as two leading market players had stayed in the bid until 81st round for a block last year. The bidding in 2021 fight brought $888 million or an estimated Tk 75 billion worth of income for the BTRC-the highest ever in an auction by the regulator.
The largest operator in Bangladesh's lucrative mobile-phone business-multinational Grameenphone-bought a total of 10.4 MHz in both bands while Banglalink procured 9.4 MHz and Robi purchased 7.6 MHz for 15 years.
Earlier, the BTRC held a spectrum auction in 2018 before the launch of 4G services. It auctioned 46.4-MHz spectrum in 11 blocks at that time.
The telecos bought 15.6 MHz in three blocks while the rest of the spectrum (67 per cent of the total) remained unsold for what they said a high price in that auction.
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