Bangladesh’s telecommunications industry has been a cornerstone of the nation’s economic and social transformation. Since the launch of Citycell in 1993, the sector has expanded rapidly to nearly 190 million mobile subscribers, drawing over Tk.1 trillion in cumulative investment and generating more than 900,000 jobs annually. This makes telecom not just a backbone of connectivity but also a vital engine of growth for the economy.

Yet, behind these achievements lies a sobering reality. The industry is highly concentrated, structurally imbalanced, and increasingly fragile. Market dominance by a few operators, persistent inefficiencies, and looming investment demands particularly for 5G pose both immediate and long-term challenges. Unless regulators act decisively, the market risks sliding into a structure where only a handful of firms survive. Such an outcome would erode consumer welfare, weaken competition, and undermine Bangladesh’s digital resilience for the future.

Market Concentration and its Risks
Bangladesh’s telecom sector is an oligopoly with four Mobile Network Operators (MNOs). Grameenphone, Robi, Banglalink, and Teletalk. Yet the balance is heavily skewed Grameenphone controls nearly half the market in both revenue (48.9%) and subscribers (45.5%). Robi holds 30-31%, Banglalink 19%, and Teletalk less than 4%.

The Herfindahl-Hirschman Index (HHI) exceeds 3700, far above the 2500 threshold for highly concentrated markets. Such dominance raises concerns of market power abuse in pricing, spectrum allocation, and service quality. Globally, three to five players usually sustain competition, but in Bangladesh the gap is stark, Grameenphone captures 91% of industry profits, Robi 9%, while Banglalink breaks even and Teletalk incurs annual losses of around Tk. 1100 crore. This imbalance erodes fair competition and threatens the survival of smaller operators.

SMP Regulations: Good Idea, Weak Implementation
To address dominance, the Bangladesh Telecommunication Regulatory Commission (BTRC) enacted Significant Market Power (SMP) regulations in 2018, followed by guidelines in 2019. The intent was clear, introduce asymmetric obligations on dominant firms to ensure a level playing field.

However, out of 20 regulatory measures, only three have been implemented as of 2025. This weak enforcement has allowed the market to remain distorted. An effective SMP regime covering interconnection, tower sharing, pricing transparency, and infrastructure access is urgently needed if competition is to function.

Technology Rollout and Investment Challenges
Telecom is not static; each generation of technology requires new investments.
>> Major generational shifts (2G → 3G → 4G → 5G) occur every 7-10 years.
>> Innovations in services, pricing, and bundling emerge every 6-12 months.

Bangladesh is now at the “runway” stage with 4G and preparing for “take-off” with 5G. To achieve full nationwide coverage urban and rural the country will need USD 8-10 billion in investment between 2025 and 2035.

But this investment will not materialize if the market structure remains unstable. Smaller operators struggling with losses cannot commit to large-scale capital expenditure. Unless the playing field is balanced, only one or two firms may be capable of financing 5G rollout leaving Bangladesh at risk of a duopoly or even monopoly scenario.

Structural Bottlenecks and Value Extraction
Bangladesh’s telecom sector faces not only market concentration but also structural inefficiencies across its ecosystem. With 26 license categories and 3,299 registered entities, the value chain is crowded, yet many participants add little value. Some extract revenue without innovation or efficiency if one such entity collects just a paisa per user daily, the total exceeds Tk. 19 lakh highlighting how rent-seeking practices burden consumers and weaken competitiveness.

Regulatory choices have also entrenched monopolies and oligopolies. Akash DTH, launched in 2019 with approval from the Ministry of Information and Broadcasting and spectrum from BTRC, remains the sole licensed operator, effectively a monopoly despite clear consumer demand. Likewise, the Tower Sharing Guidelines of 2018 (para 8) capped participation at four firms, creating a structural oligopoly and unnecessary entry barriers.

Together, these bottlenecks illustrate how regulation itself can discourage innovation, inflate costs, and reduce consumer choice in Bangladesh’s telecom ecosystem.

Root Causes of Competition Constraints
Concentration in Bangladesh’s telecom sector stems from several interlinked structural factors. High entry barriers including costly spectrum, heavy infrastructure needs, and complex licensing discourage new players and protect incumbents. Economies of scale allow larger operators to spread costs across vast subscriber bases, secure cheaper procurement, and expand more efficiently, widening the competitive gap. Network externalities further reinforce dominance, as consumers gravitate to bigger networks with stronger coverage and reliability.

At the same time, industry consolidation through mergers, acquisitions, and exits has steadily reduced viable operators, leaving only four today. Compounding this, each new technology rollout requires major capital investment. Smaller operators with weaker finances struggle to meet these demands, falling further behind their stronger rivals.

Taken together, these factors mean Bangladesh risks further consolidation, potentially leaving only the top two players, unless decisive regulatory and policy interventions are introduced to preserve fair competition.

Policy Recommendations: Safeguarding Against a Duopoly
With market consolidation squeezing smaller operators, Bangladesh’s telecom sector risks being dominated by its top two players. To prevent this slide into duopoly and protect consumers, regulators must adopt a balanced mix of ex-ante (preventive) and ex-post (corrective) tools.

1. Strengthen SMP Enforcement: Fully implement the 2018 SMP framework with asymmetric rules on interconnection, tariffs, spectrum use, and infrastructure sharing to curb dominance.

2. Encourage Infrastructure Sharing: Mandate cost-effective sharing of towers, fiber, and backhaul to reduce duplication and enable smaller operators to compete, especially in rural areas.

3. Lower Entry Barriers: Revisit restrictive policies in tower sharing, DTH, and other infrastructure services to open markets to more financially and technically capable players.

4. Support 5G Rollout: Bangladesh will need USD 8-10 billion by 2035. Spectrum price rationalization, concessional financing, and sharing models are essential to ensure smaller operators’ participation.

5. Enhance BTRC–BCC Coordination: BTRC should regulate ex-ante, while BCC enforces ex-post. Joint monitoring and data-sharing are vital to deter collusion.

6. Consumer-Centric Enforcement: Prioritize affordable tariffs, transparent billing, service quality, and robust complaint mechanisms.

7. Market Inquiries & Rent-Seeking: Conduct periodic studies, publish findings, and eliminate non-value-adding intermediaries that inflate costs without improving efficiency.

Conclusion: A Call for Fairness
Bangladesh’s telecom sector stands at a crossroads. On one hand, it has delivered significant economic contributions over 2% of GDP, more than Tk. 1 trillion in investment, and near-universal mobile penetration. On the other hand, the industry is weighed down by market concentration, fragile smaller operators, hidden inefficiencies, and looming investment gaps as the country prepares for 5G.

To safeguard the future, Bangladesh needs a forward-looking regulatory framework. This must combine strong SMP enforcement, effective infrastructure sharing, lower entry barriers, and targeted support for 5G rollout to preserve competition and attract sustainable investment.

At the same time, closer coordination between BTRC and the Bangladesh Competition Commission (BCC), stronger consumer protections, and the removal of rent-seeking practices will be critical to ensure that the market functions fairly and efficiently. Without decisive reforms, the sector risks sliding into a structure dominated by the top two players, undermining competition, slowing innovation, and ultimately harming consumers.

Writer: Md. Khalid Abu Naser.