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Citycell may shut down after August 16

  • Published at 10:18 pm July 31st, 2016
  • Last updated at 05:35 am August 1st, 2016
Citycell may shut down after August 16
The country’s oldest mobile phone operator Citycell is likely to close down its operation by August 16 as it sinks in debt to regulator, banks and different telecommunication operators.
In a notice issued yesterday, Bangladesh Telecommunication Regulatory Commission (BTRC) has asked Citycell to pay its all dues, including regulatory fee and fine worth Tk477 crore, by August 16. “If the company fails to pay dues within the deadline, it will have to close down its business,” said an official.  The telecom regulator has also ordered the company to create an alternative arrangement for providing the service to its subscribers even after shutdown. BTRC Chairman Dr Shahjahan Mahmood told the Dhaka Tribune that they are “very much concerned” about subscribers. “Citycell will have to manage an alternative way for giving its customers service and must pay its dues. Then we will take next course of action.” For years, Citycell has remained under pressure from stakeholders as it also owes more than Tk10.17 crore to different banks and telecommunication operators. The operator continued to see loss of subscribers as the company has apparently done nothing to boost services. Presently, the number of Citycell subscribers is 700,000, according to the BTRC latest statistics. Citycell lost over 1.5m subscribers in the past five years. It had around 2.3m customers in 2010. “Citycell service quality has deteriorated over the years, leading to loss of market share gradually. If the trend continues, the operator might see more fall in the number of subscribers,” said a BTRC official. In sharp contrast, most of the country’s other mobile phone operators, including Grameenphone, are witnessing rising numbers of subscribers. Citycell CEO Mehboob Chowdhury was unavailable for comments. Citycell is the only CDMA network operator in the country. It is currently owned by Singtel with 45% stake and the remaining 55% is owned by the Pacific Group and Far East Telecom. According to BTRC, the Citycell has not paid the second and third instalments of the renewal fees of Tk229 crore for 8.82 megahertz spectrum since spectrum renewal in 2012, which has breached the licensing terms. The other dues include Tk10 crore annual licence fees, Tk27.14  crore for annual spectrum fees from 2013 to 2016, Tk27.84 crore revenue sharing from 2014 to 2016, Tk8.92 crore corporate social responsibility fund from 2011 to 2016, Tk39.92 crore VAT and Tk13.5 crore late fees. BTRC director (licence) MA Tayab Hossain served a notice to the operator to explain why it should not face legal action for not paying dues. According to the BTRC, the number of SIM cards with the mobile phone users in the country was over 130m in June. Citycell had only 700,000 customers then. Its parent company Pacific Bangladesh Telecom Limited got licence for telecom services in 1989. BNP leader and former foreign minister M Morshed Khan’s Pacific Motors has 37.95% stakes in Citycell. Singapore-based SingTel Asia Pacific Investments Pte Limited holds a majority share of 45%. Far East Telecom Limited owns a 17.51% stake.
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