Bangladesh telecom sector: the case of state-owned Teletalk

Mobile telecommunication in Bangladesh is rapidly transforming from primarily a voice and SMS service to a mobile data-dominated market. Exponential growth in mobile internet adoption is driving significant market expansion. With changing technological capabilities and shifting consumer preferences, the mobile telecom industry landscape in Bangladesh is evolving at a rapid pace.

Bangladesh's telecom market is primarily dominated by the private mobile operators. Grameenphone, the market leader, is a joint venture between Grameen Telecom and Telenor. The second largest mobile operator in Bangladesh, Robi Axiata is owned by Axiata of Malaysia and Bharti Airtel of India. Third largest operator, Banglalink is owned by VEON Ltd.

The mobile network operators (MNOs) of Bangladesh are increasing market segmentation to deliver innovative digital services such as education and healthcare services, mobile financial service (MFS), mobile bill payment, mobile ticket reservation, e-commerce, video streaming, music, IPTV and value-added services for target consumer segments.

In comparison with private operators, the lone state-owned mobile operator Teletalk Bangladesh Limited has failed to secure a competitive position and thrive in the telecom market although the state-owned enterprise (SOE) gets various privileged support from the government.

TELETALK INCURS LOSS DESPITE GOVERNMENT SUPPORT: When Teletalk launched commercial operation with 2G services in 2004, the primary mission of the company was to acquire a significant market share of the booming telecom sector by providing countrywide network coverage. Launch of Teletalk created huge enthusiasm among customers. Nevertheless unsatisfactory service quality of Teletalk impelled many customers to gradually switch to other operators.

Because of its being the state owned operator, Teletalk was given the priority to introduce 3G mobile phone services in Bangladesh and was therefore the first operator to launch 3G services in 2012. Private mobile operators officially launched 3G mobile data service in October 2013. The government gave privilege to Teletalk by making the use of its SIM cards mandatory for availing significant government services. Teletalk was also given priority in the radio frequency (spectrum) allotment for both 4G and 5G. As was the case, Teletalk was the first operator to launch 5G services on a trial basis in December 2021. Of the remaining three mobile operators, Banglalink Digital Communication Limited launched 5G services on a trial basis in selected locations in July 2022, while Robi Axiata Limited and Grameenphone Limited launched 5G services on a trial basis in selected locations in September 2022.

 Despite getting priorities and privileges from the government, Taletalk has failed to ensure quality service and attain significant number of subscribers. According to data of the Bangladesh Telecommunication Regulatory Commission (BTRC), the total number of mobile subscribers reached 186.22 million in March 2025, of which Grameenphone had 84.09 million subscribers, Robi, 56.36 million and Banglalink, 38.23 million. Teletalk had only 6.58 million subscribers in March 2025, which is merely 3.53 per cent of total subscribers.

The state-owned operator has a persistent trend of incurring net losses since its inception. According to the audited financial report published in the Directors' Report of the Company, Teletalk incurred a net loss amounting Tk. 179.89 crore in the fiscal year ending on June 30, 2024.

BTCL RESOURCES REMAIN UNDERUTILISED: Teletalk was initially launched by Bangladesh Telephone and Telegraph Board (BTTB) as a subsidiary project of mobile network service, named BTTB bMobile. Later the company was rebranded to Teletalk Bangladesh Limited as the only state-run mobile operator of Bangladesh.

BTTB became a public limited company on July 1, 2008, and was renamed Bangladesh Telecommunication Company BTCL. As SOE, BTCL offers services such as telegraph, local telephone networks, nationwide dialing (NWD), international telephone call facilities, international circuit leasing, international maritime satellite communication, and internet and data services.

BTCL has more resources than any other major mobile operator in Bangladesh. According to the BTCL annual report, the company holds total assets of around Tk. 70,000 crore. Among these, the assets related to exchange equipment, transmission, and outside plant are valued at approximately Tk. 12,000 crore. The value of BTCL's buildings is around Tk. 1,000 crore. BTCL holdings claim the highest value, estimated at Tk. 50,000 crore.

Despite vast resources possessed by the SOE, core business operations of BTCL remain deeply flawed. Revenue from key segments such as the International Gateway (IGW), telephone services, and value-added services has reportedly continued to decline. Poor service quality and lack of technological expansion have contributed to the decline of operational efficiency and service revenue.

According to the Annual Report of BTCL, the SOE claimed a net profit of Tk. 67 crore in fiscal 2023-24 on account of non-operating income obtained from fixed deposit receipts (FDRs), which stood at Tk. 168 crore in FY23. Within this declining business scenario, the extensive infrastructure owned by BTCL, including towers used for telephone and internet services remain underutilised.

POLICY PROVISION FOR SOE-PRIVATE PARTNERSHIP: Bangladesh's telecom market is characterised by intense innovation and forward-looking business strategies. The mobile industry has seen significant investment in network expansion and technological upgrading, particularly in 4G technology deployment and preparation for 5G services. The private MNOs including Grameenphone, Robi and Banglalink are actively investing to expand their digital services portfolios.

When the National Telecom Policy was formulated by the Ministry of Post and Telecommunications in 1998, it was envisaged in the policy objectives that:  resources to the sector are to be maximised through participation of both public and private entrepreneurs in operating the services in areas where it is economically and socially justified. Efforts shall be geared up and coordinated to create an investment climate to help optimisation of resources from both national and international sources (Article 3.7).

For enhancing competitiveness of SOE, article 7.10.1 of the National Telecom Policy 2018 has the provision to: encourage the state owned telecommunication enterprises to adopt competitive business strategies including human resource development, management restructuring, partnering with private sector and attracting local or foreign investment.

BUSINESS FOOTPRINTS OF SOES: Telenor, the 58.8 per cent shareholder of Grameenphone, is a state-owned multinational telecommunications company of Norway. Grameenphone was the first Telenor venture in the Asian telecom market. The success of Grameenphone led Telenor to increase focus in Asian markets with successful entries in Pakistan, Myanmar and other Asian countries.

Similarly, Axiata of Malaysia holds a major controlling stake of 61.82 per cent in Robi, the second largest mobile network operator in Bangladesh. Axiata was incorporated in 1992 as the mobile and international operations arm of Telekom Malaysia Berhad, the national telecommunications company of Malaysia.

If SOEs such as Telenor and Axiata can run successful businesses operations and create global and international footprints, it is sheer misappropriation of resources and lack of utilisation of business opportunities on the part of Teletalk to keep incurring losses for decades.

PROSPECTIVE TRANSFORMATION OF TELETALK: In present-day world businesses are immensely dynamic and require situation-wise decision-making along with long-term planning and projections. Due to lack of on-time effective decision-making by the board of Teletalk and absence of competency to chalk out business strategies, the state-run mobile operator has remained incapable to formulate significant short-term action plan and/or long-term strategic plan.

As is obvious from the decline in subscriber numbers, quality of services and revenue, the business condition of Teletalk has worsened to such an extent that the auditor of the company reportedly expressed doubt on the company's ability to continue operations. And for some time now, there has been speculation regarding handing over the state-run mobile operator to local or foreign investors for improving its services and making the company profitable.

According to a report by the global market research firm Mordor Intelligence, Bangladesh telecom market size is estimated to be $5.08 billion in 2025, and is expected to reach $6.27 billion by 2030, with a compound annual growth rate (CAGR) of 4.31 per cent during the forecast period (2024-2030).

If business-terms are successfully negotiated with prospective foreign investor, there is a bright prospect of attracting substantial foreign direct investment (FDI), which would thus bring in much required capital for network expansion, management restructuring and service improvement of Teletalk. With the right mix of investment, competitive strategies and long-term planning the state-owned telecom operator can transform its loss-making business to a profit-making venture.

T.I.M. Nurul Kabir, Executive Director, Foreign Investors Chamber of Commerce and Industries (FICCI), is an analyst on business, technology and policy.