Mobile ecosystem: Easing the way to future Bangladesh
In this era of
globalization, people's daily life communication has become much easier and more
flexible. Influencing more and more people online, the usage of digital devices
and technological advancements are playing a great part in this globalization. The
growing trend of using modern technology and devices is creating a perfect
environment for a new industrial revolution, which some industry insiders have
dubbed 'Industry 4.0', envisioned to have probably a more far-reaching impact
on society than the previous three industrial revolutions. Through employment
creation and adding value to GDP, the usage of digital devices are playing a
vital role in the improvement of a country or region's economy. According to
GSMA (Global System for Mobile communications Association), mobile technologies
and services in 2021 have contributed 5% to the Asia-Pacific region's GDP and
8.8 million new jobs have been created in this region through this mobile
ecosystem in this period. In 2019, Bangladesh's mobile technology and services
generated $16 billion in economic value, equivalent to 5.3% of its GDP.
When the whole world got
stranded amidst this COVID-19 pandemic, the Internet played an important role
in maintaining a balance between social and work life. Local mobile operators
in collaboration with the government authorities have played a crucial role in
creating public awareness by giving regular updates on COVID-19. Also, the
customer database of the mobile operators and the delivery of the COVID-19
reports through mobile SMS have helped the key stakeholders to take timely
action. Due to the low handset device prices and low call rates as a result of
fierce competition among local phone operators, Mobile phones historically have
served as a tool for connecting the common people in the LDC countries like
Bangladesh. This mobile ecosystem has worked as a helpline for the common
people amidst the pandemic.
Along with the
restrictions on going out, the prolonged spread of COVID-19 has prompted people
to do classes and work online, which has made people accustomed to the Internet
ecosystem. This has led to the increased usage of various e-commerce platforms,
MFS (Mobile Financial Services), and online streaming platforms. In fact, Local
e-commerce platforms that had already achieved steady growth in the
pre-pandemic period saw tremendous growth during the pandemic. A Dublin-based
research firm has projected a CAGR (compound annual growth rate) of 12.30%
growth in the e-commerce market between 2022-2026, which will take the local
e-commerce market size from TK. 56,870 crore in 2021 to around TK. 1.5 lakh
crore by 2026.
Crucial changes in human behavior due to COVID-19 are leading us to a digitalized society where technology will play a key role in shaping a country's economy. Presently, 5-G operations are being deployed across countries around the world to enable the delivery of next-generation offerings such as cloud services, artificial intelligence (AI), the Internet of Things (IoT), edge computing, etc. However, in Bangladesh, after launching the 5G services experimentally in December 2021, the authorities halted the 5G implementation project and have asked the mobile operators to upgrade the quality & scale of the 4-G services. Amidst the forex reserve constraints, this is undoubtedly a timely and calculative decision for the country. Again, it is also a fact that 5G services will play an important role to mitigate possible challenges imposed by the predicted Industrial revolution 4.0. However, transitioning into the 5G era with the existing flaw and vulnerabilities in the current 4G system may not give us the desired results. There are certain issues that need to be properly addressed to secure an expected transition from the existing 4G system.
However, Bangladesh is
well ahead of other contemporary countries in Internet data affordability which
is definitely a positive sign. UN Broadband Commission has set that entry-level
broadband services (two price baskets introduced by ITU - Fixed broadband 5GB
and Mobile broadband 1.5 GB) in developing countries should be made affordable
at less than 2% of monthly Gross National Income (GNI) per capita. Among other
countries (Angola, Bhutan, Nepal, Lao People's Democratic Republic, Sao Tome,
and Principe & Solomon Islands) to graduate from the LDC list by 2023-2026,
Bangladesh is the only country that has achieved the targets set by the UN
Broadband Commission in both categories. Also, the country's 95% of the
population lives under the coverage area of 4G services. However, the main
problem arises when it comes to the case of the coverage-usage gap (The usage
gap means those who live within the 4-G coverage areas but don't use the
services). The new population census suggests around 6.5 crore people, aged 18
or above, don't use the internet. Again, A GSMA report found a significant 4-G
usage gap of 67 %.
Before discussing reducing the usage-coverage gap, we need to remember that many people who don't use the internet may not know how to operate a phone or computer or may not have attachments with the available content on the internet. So, policymakers need to formulate such a policy that focuses on the enhancement of users' knowledge & skills as well as the development & promotion of local content. Also, the privacy of citizens' data and information need to be ensured by appropriately addressing concerns related to Internet service security. There should be much flexibility in the system to capitalize on the scope of potential collaboration due to the changing consumer patterns among the local MFS players and numerous banking & non-banking financial institutions. On the way to graduating from the LDC list and on the verge of a demographic dividend, Bangladesh has the potential to transform itself into a prosperous future country where the country's mobile ecosystem can undoubtedly play a vital role in that transition.
The article was co-authored by Dr Mohammad Abdul Hannan Pradhan, Professor of the Department of Economics, SUST.
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