The New Nation - Internet Edition

INTERNET service providers have hailed the government's 20 per cent cut in submarine cable fees as 'a good move' for the information technology sector.. At the same time, they warned that Internet penetration would remain low unless the government adopts measures to build what they called 'Internet infrastructure'. The Internet Service Providers Association, Bangladesh felt happy over the reduction in cable fees but stated that it might not help increase number of Internet users if the government does not address other bottlenecks. The government should reduce the customs duty on networking equipment to encourage firms in the Internet business and to spread Internet connectivity across the country. The number of Internet users in the country is currently about 10 lakh. The government imposed a 55 per cent duty on networking equipment, which emerged as a major obstacle to the growth of the industry.

Earlier in January, the finance ministry approved the new rate forwarded by the ministry of telecommunications as per recommendations made by the Bangladesh Telegraph and Telephone Board that operates the submarine cable. Bangladesh was connected to the information super highway in May 2006 at a cost of US $ 35.1 million. The SEA-ME-WE-4 cable has a bandwidth capacity of 1.2 terabyte per second. Though the BTTB originally subscribed to a 10 per cent Gigabyte per second bandwidth last year the board was granted another 4Gb complimentary bandwidth. This bandwidth, however, remains underutilised as the telephone board has sold only 10 per cent of the total capacity to the Internet service providers and other telecom service providers.

Following approval from the Bangladesh Telecommunications Regulatory Commission, the BTTB would charge subscribers according to the new rate - Tk 1,000 monthly for unlimited usage of internet services, down from Tk 1,400 while the monthly charges of two other corporate packages would be Tk 700 each, down from Tk 1,000 and Tk 750 respectively. The charges for installation and testing for international private lease circuit above 2 megabytes per second would be Tk 75,000 down from Tk 90,000 for bulk users which includes the Internet service providers' software firms, and mobile and private land phone operators. Charges for installation of leased Internet access above 2megabits per second will be minimum Tk 20,000 while monthly rental for the same service will be minimum Tk 32,000 and Tk 40,000 from existing Tk 55,000 and Tk 75,000 respectively as reported by the media. The annual rental for leased internet access service up to 2 megabytes per second would be a minimum Tk 96,000 and maximum Tk 1,44 lakh from the existing Tk 1.65 lakh and Tk 1.92 lakh respectively. The BTTB has stated that the new rate would cause loss of roughly 45 per cent of its current revenues from the submarine cable segment. However, the reduction is expected to cause a three-fold growth in user base and with it revenue earnings.