Reduced rate of call termination to boost govt revenue

The telecom ministry has slashed Voice over Internet Protocol (VoIP) call rate by 50 per cent to curb illegal business of the sector.
The new rate of the much-talked-about VoIP call will be US$1.5 cents instead of $3.0 cents.
"We have approved the new rate for VoIP call termination and sent it to the finance minister," said telecom minister Abdul Latif Siddiqui on Wednesday while talking about different issues of the telecom industry with the members of the Telecom Reporters` Network, Bangladesh (TRNB) at his ministry office.
When asked, he said the new price will be applicable for six months on experimental basis to evaluate the benefits of the decision.  
The minister said the price cut will enhance the number of VoIP calls in legal channel and hoped there will not have negative impact on government revenue.
The number of VoIP calls could go up to around 80 million a day from existing 55 to 60 million a day, the telecom minister expected.
Earlier, finance minister scrutinised the proposal of the telecom ministry for call rate reduction considering the negative impact of revenue earning from illegal calls.
Sources said two issues are being taken into strong consideration to materialise the decision: it will cut government revenue around Tk11 billion and there will be possibility of increasing VoIP call number in a legal way which may offset the revenue earning fall, according to the ministry source.
Currently, there are some 18 IGW (International Gateway) operators out of 29 permitted for termination of VoIP call. The rest 11 IGW operators` operation was either suspended or licence cancelled for nonpayment of dues to the Bangladesh Telecommunication Regulatory Commission (BTRC).
However, total call termination number in the country will be around 14 million a day as per the data of the international carriers.
Examining the VoIP call rate of the some Asian countries, the Telecom Ministry found that the Bangladesh is offering one of the lowest call rates after India. The VoIP call rate in India is $0.1 cent while 0.6 cents in Thailand and Singapore, 0.11 cents in Philippine, 0.9 cents in Sri Lanka and 0.85 cents.   
Besides, telecom ministry`s proposal will reduce revenue sharing part with the telecom regulator from 51.75 per cent to 40 per cent.
Meanwhile, some stakeholders appreciated the initiative of the telecom ministry and expressed hope that it is will help increase the number of legal VoIP call at large.
At present, the IGW operators share 20 per cent of their total revenue income with the mobile phone operators and 13.25 per cent with the Interconnection Exchanges (ICX) operators in addition to 51.75 per cent with the BTRC.
International Gateway (IGW) operators opined the government could boost its revenue through reducing rate/tariff of international call termination by 1.5 cent.
They said termination of every legal call charges BDT 2.40 per minute while illegal termination charges BDT 1.15 for every minute.
Apprehending the aspect, the telecom regulator -- Bangladesh Telecommunication Regulatory Commission (BTRC) recently sent a letter to the Posts And Telecommunications Division (PTD) to re-fix the international call termination rate to 1.5 cent from existing 3 cent. Immediately, the PTD forwarded the letter to the finance ministry. But, the ministry of finance has denied the proposal and sought justification regarding it.  
The IGW operators have been demanding to the telecom minister since two years to trim the rate of international call termination. But, the then ministry of posts and telecommunications had disagreed with the demand; rather Secretary of the ministry Abubakar Siddique had told the media that government would lose revenue of BDT 12.0 billion  annually if the call rate is reduced.  
However, the BTRC through its logic said the government would be benefited if the initiative is implemented.    
The incumbent government in its previous tenure had re-fixed per minute call termination rate to 3 cent from 4 cent to curb the illegal call termination. In last year, the government has issued license to 25 IGW operators that has triggered difference between ministry and the telecom regulator.
Meanwhile, 12 operators failed to pay the due. Later, license of few operators has been suspended while few escaped by paying due.     
Statistics showed last year, the country on an average received 30 million minute legal call each day while volume of illegal call was 45 million minute. At the end of the year, the number of legal call had reached at 40 million minute while volume of illegal call was 35 million minute. The industry insiders attributed the call rate differences for the huge number of illegal call.
A BTRC letter signed by the then director of System and Service Division Lt. Colonel Rakibul Hasan said: "Tendency of illegal international call termination by the unscrupulous IGW operators would be shrunken if the proposed call termination rate is implemented. The commission also think tendency of terminating the international call as local call will come down significantly after narrowing the differences between international and local call termination rate/tariff. In this circumstance, the expected discipline in the sector would be returned."      
Brig. General Mustafizur Rahman (retd), Chairman of International Gateway Clearing House, said instability and crisis situation in country's telecom sector, which has only been created due to the present call rate, would be solved along boosting international call volume if the proposal of BTRC is implemented.  
He said there is no qualitative difference between clear channel call and grey channel call, and the clients have no headache on clear or grey channels call.
"If the government reduces call rate, revue will be boosted which also help control VoIP, as the grey call terminator will force to stop illegal call termination whenever there is no business," added Rahman.
BTRC Chairman Sunil Kanti Bose thought government could generate more revenue through reducing call rate. "We don't see any other option to minimize the grey call that's why we've suggested to slash the call rate," he added.