Over the past decade, Bangladesh has experienced a remarkable digital transformation driven by a carefully structured telecommunications ecosystem comprising National Transmission Network (NTTN) operators, Internet Infrastructure Gateways (IIGs), Internet Service Providers (ISPs), and Mobile Network Operators (MNOs). This layered framework has ensured the separation of infrastructure and service delivery, enabling competition, reducing costs, and expanding connectivity across the country.
The scale of this progress is significant. Internet users have increased from just 0.4 million in 2007 to approximately 134 million as of now. Bandwidth usage has grown exponentially -- from 10 Gbps in 2008 to around 7,600 Gbps in 2025. Fibre -network expansion, largely driven by NTTN operators, has surged from 8,100 kilometres in 2012 to 172,000 kilometres as of 2024. At the same time, the number of licensed ISPs has risen from around 200 to nearly 2,900, extending internet access to upazila and union levels and creating a substantial employment base.
This multi-layered model has also drastically reduced costs. Transmission costs between Dhaka and Chattogram, once as high as Tk 15,000 per Mbps, have fallen to nearly Tk 20 per Mbps -- a reduction of almost 99.9 per cent. Consequently, consumers now enjoy affordable internet, with unlimited packages available for around Tk 400 per month. Government revenues have also increased significantly, with earnings from revenue sharing rising from Tk 5.65 billion in 2007 to approximately Tk 45 billion in 2025. These outcomes clearly demonstrate that the separation of infrastructure and retail services has been central to Bangladesh's telecom success, largely fuelled by domestic investment.
However, the proposed Telecommunication Network and Licensing Policy 2025 challenges this established model by seeking to eliminate what it terms "non-value-adding middlemen". This characterisation is misleading. The intermediary layers -- NTTN, IIG, ICX, and IGW -- have played a critical regulatory and operational role, ensuring oversight, maintaining service standards, and preventing monopolistic practices. Their introduction helped the regulator bring discipline in the market. For example, in 2008, authorities fined major mobile operators for illegal VoIP activities, demonstrating how these licensing layers strengthened accountability.
A key concern with the new telecoms policy is its potential to blur the distinction between infrastructure providers and service operators. It allows MNOs to deploy their own fibre networks and directly connect last-mile towers, effectively enabling vertical integration. This undermines the principle of Access-Transmission Separation, which has guided sectoral development since 2010 and facilitated the emergence of independent infrastructure providers such as NTTNs and tower companies.
The policy also introduces asymmetry in ownership rules that may disadvantage domestic investors. While local companies are restricted from holding multiple licences or engaging in cross-ownership across different layers, foreign-owned entities are exempt from these limitations. This creates a situation where companies with relatively low local investment can gain control over multiple segments of the telecoms value chain, including both infrastructure and service provision. In contrast, firms with higher domestic participation face stricter regulatory barriers. Such disparity sends a troubling signal: the greater the local investment, the greater the restrictions -- raising concerns about fairness and national economic interests in a strategically important sector.
The economic implications of this shift are substantial. Vertical integration could lead to "market foreclosure", where dominant operators prioritise their own services, impose high wholesale charges on competitors, or delay interconnections. Over time, smaller players -- including NTTNs, tower companies, and ISPs -- may struggle to compete on cost and scale, eventually being pushed out of the market. This would reduce competition and lead to greater concentration of power among a few large operators.
International experience provides clear warnings. In the United States, the telecommunications sector was once dominated by a vertically integrated monopoly. The breakup of AT&T in 1984 led to a dramatic reduction in prices -- long-distance call rates fell by around 70 per cent within a decade -- and spurred innovation. Similarly, in India, the entry of Reliance Jio in 2016, supported by vertical integration and aggressive pricing, initially benefited consumers. However, it also led to the exit of more than a dozen operators, leaving only a few dominant players. As competition declined, prices began to take vertical turn again, increasing by 20 to 50 per cent in recent years.
The employment implications of the new policy are equally concerning. More than 12,000 workers employed in NTTN, IIG, ICX, and IGW segments could face direct job losses as intermediary layers are consolidated or eliminated. The impact could be even greater in the ISP sector, which supports nearly one million direct and indirect jobs. If MNOs expand into fixed broadband services through technologies such as Fixed Wireless Access (FWA), they could significantly reduce demand for local ISPs. In contrast, MNOs themselves employ only around 4,000 people, underlining that the net effect on employment could be strongly negative.
Another critical issue lies in the restructuring of international connectivity. The policy allows MNOs and ISPs to independently manage international services, effectively absorbing the functions of IIGs. Given that approximately 60 per cent of internet users in Bangladesh rely on mobile networks, MNOs would gain substantial control over internet traffic. With their scale advantage, they could offer faster and cheaper services through direct peering and caching, creating an uneven playing field that smaller operators would find difficult to match. This could gradually recreate the pre-2008 scenario, where a few dominant players controlled the entire value chain and limited market competition.
The policy also raises concerns regarding capital outflows. At present, MNOs repatriate approximately Tk 26 billion annually. Under the new framework, this outflow could increase by an additional Tk 7.6 billion if adequate safeguards are not put in place. Retaining this capital within the country could instead support infrastructure development, expand network capacity, and generate employment -- benefits that have historically been driven by domestic telecoms operators.
At its core, the debate is not about resisting reform but about ensuring balanced and sustainable progress. Bangladesh's telecommunications sector stands at a critical juncture. The 2025 policy has the potential to modernise infrastructure, streamline operations, and enhance digital inclusion. However, without careful calibration, it risks undermining competition, marginalising local investors, and increasing long-term costs for consumers.
A more measured approach is, therefore, essential. Policymakers must ensure a level playing field, maintain clear distinctions between infrastructure and service provision, and protect domestic investment. Strong regulatory oversight will be necessary to prevent market concentration and safeguard consumer interests.
Bangladesh's telecom success story has been built on competition, regulation, and local participation. Preserving these foundations will be crucial to ensuring that future reforms do not reverse past gains.