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Drastic fall in legal overseas incoming calls in last 3 years

* Rising use of OTT apps, illegal VoIP largely responsible * Growing influence of a cartel in IGW business causes substantial revenue loss to govt

Mehdi Musharraf Bhuiyan | December 12, 2018 00:00:00

The number of overseas incoming calls using legal channels recorded a drastic fall during the last three years with the rise in international call termination rates.

The growing use of over-the-top (OTT) applications and increased use of illegal Voice over Internet Protocol (VoIP) have been widely blamed for the decline in overseas call through conventional channels.

According to the figures of Bangladesh Telecommunication Regulatory Commission (BTRC), the volume of average daily incoming international call was around 120 million minutes just three years ago.

Even, at the beginning of this year, the volume used to stand at 55 million to 60 million minutes per day.

However, as per the latest BTRC figures, the daily average volume of incoming international calls has now reduced to mere 32 million, which means that overseas call volume has been reduced by 75 per cent over the last three years.

Analyzing the scenario, it was found that there is a strong correlation between the rise in international call termination rates and the reduction in overseas call volumes in the country.

For example, up until June 2015, the average volume of international calls used to be 120 million minutes per day. At that time, the effective call termination rate in the country was Tk 1.20.

The rate of international call termination was raised from 1.5 cents to 2.0 cents on August 24, 2015. Consequently, the number of international incoming calls coming through legal channels dropped drastically by 28 per cent in subsequent months.

Afterwards, in February 2018, the termination rate was raised yet again, from 2.0 cents to 2.5 cents.

As a result, the volume of overseas calls coming through legal channels reduced to a mere 30 million minutes per day on average in just ten months.

Insiders within the industry blamed the reduction on illegal call terminations as well as growing popularity of OTT apps like WhatsApp or Viber.

"The rising use of OTT is a big reason for the drastic drop in international call volume through conventional channel. This is true not only for Bangladesh but also for the whole world," said telecom industry specialist Abu Saeed Khan.

Regarding the rise in call termination rate, he said telecom tariffs should not be determined by the government. Rather it should be determined by the market.

"Whenever the government determines the telecom tariff, than the market is bound to distort," said Mr. Khan, who is also a Senior Policy Fellow of regional think-tank LIRNEasia.

Insiders also pointed out that although International Gateway (IGW) operators are bringing international calls at a rate of Tk 2.10 per minute, they are sharing their revenue at 1.75 cents or Tk 1.47 rate.

When contacted, IGW operators admitted that the rise in use of OTT along with the use of illegal VoIP is causing the reduction in international call volume through legal channels.

However, when asked about the issue of revenue sharing, they declined to make any comment.

Nevertheless, insiders observed that the increasing monopoly within the IGW business and the growing influence of a certain cartel means that the authority is shying away from taking any stance in this regard.

It is estimated that the indecision regarding international call termination rate and revenue sharing from the earning has already caused the government to lose revenue worth around Tk 20 billion.

Insiders also cited the example of India, which has decided to reduce the termination rate primarily to increase the international incoming call volumes.

India's telecom regulator - Telecom Regulatory Authority of India (TRAI) - has recently reduced the international termination rate (in Rupee) from 53 paisa to 30 paisa, which is equal to 35 paisa in Bangladeshi local currency.

It means that Bangladesh's international call termination rate is six times higher than India.

Earlier, BTRC initiated several moves to increase international call volumes. Back in April 2017, it took the decision of reducing international call termination rate to Tk 1.28.

Also, the IGW operators were to share revenue with the government, at the termination rate they were bringing in the calls to the country, as per the BTRC decision.

Although these decisions were taken in consultation with operators, none of the decisions has been made effective as of now.

It is also notable that the state-owned mobile operator Teletalk usually leads the way when it comes to the use of VOIP.

In October, BTRC officials detected six illegal VoIP installations, where 10,947 SIM cards of different mobile phone operators were found along with equipment worth around Tk 3.7 million.

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