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PTA, Its the Time To Act and Save the Industry!

By  | 05, Dec 2013 | 30 Comments

By Sarfraz Arshad

decline PTA, Its the Time To Act and Save the Industry!

Pakistan’s telecommunication industry, for the past 10 or so years, has been highly instrumental in not only generating handsome revenue for the government but is also providing relief to the masses by enabling them with advanced telecom services and offering job opportunities to hundreds of thousands of individuals.

The industry that has suffered badly from the law and order situation, security issue, lack of interest of foreign investment, is undergoing its worst era since the Telecommunication Ordinance, 1994 which lead to the establishment of “The Pakistan Telecommunication Authority (PTA)”, “Frequency Allocation Board (FAB) and “National Telecommunication Corporation (NTC)”.

The purpose of the first two i.e. PTA and FAB were to maintain fair competition and regulate the telecom industry and telecom services.

As if law and order situation and the country’s uncertain state of affairs were not enough, the other culprit of this recession in Pakistan’s telecommunication industry is PTA, which failed to meet its founding purpose i.e. “to maintain fair competition and regulate the telecom industry and telecom services”.

In the broad-band internet sector PTA has totally failed to maintain any kind of fair competition. “Pakistan Telecommunication Company Limited” (PTCL) has clear monopoly; the landline giant backed with a huge infrastructure all over the nation has lowered its rates to an extent that there is no question of competition. Almost all of the remaining broad band service providers are suffering due to the situation. Most of these broadband operators have exited, other are planning mergers while the remaining ones are without any investment plans, leading to downsizing and uncertainty amongst their ranks.

So, a big industry has succumbed to monopoly of PTCL and lack of regulation by PTA that allowed this without any notice (read incompetence). It appears like the term Significant Market Player (SMP) is entirely forgotten.

Apart from the above, frequent suspension of mobile services, huge amount of taxes, and blocking of online content are some of the issues that are hurting the industry badly in terms of revenue, chasing away the investors and hence the repercussions; recession in an industry that proved its potential in the past and continues to promise much more.

PTA has failed to perform its role, and has failed to understand the business needs of its license holders.

In the current economic situation it is essential for PTA to re-evaluate its policies to regain the investor’s confidence, and in order to do so they will have to think by putting itself in investors’ shoes.

Providing a level playing field where everyone should have equal opportunities. Monopoly needs to be broken by setting reasonable tariff brackets. Also, before forcing any policy PTA needs to ensure it’s financial and business repercussions on the licensees. Its only the last chance the authority has got, or things will worsen to a point of no return.

While we appreciate the planned auction of 3G and the way PTA has carried forward things so far, there is a lot more to be done. Telecom and broadband policies expired a long ago, so is the IT Policy, issue of MVNO is long pending, quality of service surveys were last conducted in 2010. And what now? There is a plethora of work to be done and time is only ticking.

Proper regulation – even now – and healthy competition can attract foreign investment and can make this sector an important contributor to the economy of the country again.

An intelligent and business friendly regulator is essential to revive the lost glory of the industry.

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  • Guest

    I totally agree what Mr Sarfraz Arshad has written above. Along with 3G, it should be top priority of PTA and GOP to issue new comprehensive telecom policy without any further delay. It came to my attention that without doing so, PTA wants to move ahead. This would be another step towards turmoil and endless litigation.

    • Affan

      Sindh High Court has barred issuance of new licenses today until new telecom policy is formed.

  • Pakistani

    Agree with point of PTCL monopoly and PTA’s lack of understanding Telco business needs

    • Guest

      Agreed. New entrant through a transparent system should be allowed to break PTCL developing monopoly.

  • Sohail

    PTA is awarding news licenses against expired telecom policy. They can fetch 100 times more licensing fee if they issue new policy as per new market dynamics. Main motive is to give benefit to few individuals/entities. Soon NAB will start investigation on this underhand deal. God help us.

    • Guest

      Pandora Box!

  • AMC- Corporate Analysts

    PTCL is also running on foreign investments, its Etisalat now and if it has beat the competition with such a big lead we should really appreciate its strategies.

    • Nadeem Humdani- Blogger

      Yes, The writer has forgot that PTCL (Etisalat) is also the foreign investor and if a foreign investor has beat other foreign investors in Pakistan, then we suggest its the ideal competition senario for Pakistan and its the matter of benefits to the pakistan nation.

  • Safaid Such

    Thanks to Ptcl for providing services with reasonable Prices, I remember the time when there was one cellular GSM company who was looting the nation, And Ufone triggered the pricing competition that ultimately benefited the nation… So If any one can compete on Price its his right until unless user does not suffer.. Long live PTCL (ufone)..

  • Shahid Saleem

    It gets worse. I saw this news article today: Grey phone traffic: IT authorities passing the buck to ISI!!!

    The government’s information technology authorities deserve spanking as they have not just terribly failed to address some burning issues facing the internet users but have also shifted the burden of blocking and monitoring grey traffic to the Inter-Services Intelligence

    the ISI-controlled private-vendor-installed system to detect and block illegal telephony is choking the country’s internet resulting in disruptions of various internet applications like virtual private networks (VPNs), Skype, voice chatting, video conferencing, etc.

    complaints received by the authorities show that the system is also disrupting services of broadband operators, call centres, software companies and other businesses.

    all international long distance (LDI) operators pooled a sum of $27 million (Rs2.8 billion) and paid to the ISI for purchase of the modern system for blocking of illegal traffic. Previously, the Pakistan Telecommunication Authority (PTA) had installed this type of equipment about five years back but the mandate was shifted this time to the intelligence agency for unknown reasons.

    Competition Commission of Pakistan (CCP) has already declared the ICH agreement illegal but it is still continuing due to stay orders granted by the courts. After implementation of the ICH and increasing the call rates to Pakistan, legal traffic to Pakistan dropped drastically and a huge surge was reported in grey traffic. The PTA and FIA have been working together to detect illegal exchanges, conduct raids and arrest culprits.

    sources say that the whole internet traffic of the country has been left at the mercy of a system that is being operated in an amateur manner in total disregard to the agony faced by the telecom operators, call centres and internet users. Call centres are losing huge foreign exchange revenue and Pakistan is getting bad publicity in the international business community.

    • Ejaz

      Complete article was extract from a letter of a telco to PTA and MoIT. Mr Ansar Abbasi also do copy n paste instead of indigious work.

    • Bilal Iqbal

      good analysis…
      being a business student.. I think strategy would be more powerful along with technology… if we remove the reason for Gray trafficking… who would go for it at all… people choose because they need it.. ICH was a foolish decision by authorities for the profit of few and lose of people …. direct investment would be welcomed instead of fetching money directly from the pockets of people…

  • Mr. Active X

    PTA First Of All Stop GEO Network Which Is Showing 400% Indian Content, Selling Its Air Time For Money, Changing The Ideology Of Pakistan!!
    Then Stop Indian Movies Which Are Imported In Pakistan By Showing Fake Licenses!!

    • Arslan Ehsan

      for that we have another good for nothing body called PEMRA :p

  • Taimur

    In few years time, there will be one broadband service provider in pakistan (PTCL). Don’t worry about rates, you will see how the rates will shoot-up when monopoly is ascertained. I am willing to pay 2500 per month for good internet, but can’t find anyone except PEETCL. Good bye maxcom, LDN, Qubee. It was nice using you all. I really enjoyed the time i spent with you guys. Its the time for PTCL now to abolish and destroy the nation like always and as destiny as brought us here. Its the Destiny and the collapse of the civilization, shifting the time flow backward to the stone-age and producing total nincompoops.

  • E x p a t r i a t e

    Great Article and very serious matters they are, PTA is not doing it’s work with sincerity. They should focus on getting more and more investment in the country by having flexible law, taxes and it should listen to the pain points of investors on regular basis. The country is already at a verge of destruction and the institutions like PTA are working as catalyst in this process.

  • Inam Khan

    Nice observation Sarfaraz Arshad

  • Inamullah Taj

    Who wants to save “any industry” in Pakistan?!
    Chill out people. These CSS Administrative officers have killed us, in every organization, with every aspect.

  • commando

    i am not that dumb but why my leaders and policy maker are dumb ???
    layman can see whats better but our decision makers can not assess ????

    • Shahid Saleem

      A person is smart. People are dumb, panicky dangerous animals and you know it.

  • MRA

    PTA is recently doing fine job in blocking grey traffic and illegal voice traffic…and u r only focusing on their down point…..go get a job loser…

    • Shahid Saleem

      PTA did nothing when ICH was formed except support the LDI companies when they looted. Grey traffic would not exist if PTA did their job.

      So they create the problem then they create the solution (in a bad way) and sheep like you praise them. What more could they ask for?

    • Baghi

      @635efc023cd0d7e5a68b3bf582ecbaf2:disqus Has PTA blocked greay traffic????? Just wake up, and update your info, PTA has done nothing about it. Instead they have handed over the chaos to Intelligence Agencies to do so. The Hell with PTA and all the people running its Nonsense System. When the people like you select the Lootership then who bullsh*t will save the country?

  • ZeeshanShahid

    The ‘telecommunication industry’ that is referred to here primarily includes the mobile phone operators that survive on ‘bait and switch’ sales tactics, downright balance theft, charging ‘fee’ for services they’re in the business of providing (demanding ROI over and above revenue!) while never compensating line rent charged for days when service was demanded to be switched off, tax evasion, leak funds through transfer pricing to group companies, provide crappy QOS with no resort for customer protection, zero customer service, false claims of ‘fastest’ internet (my IBM connection in 1998 was faster!)… I can go on all day.

    The other half, the ‘broadband’ industry that, inclusive of PTCL, shamelessly engage in falsely marketing speed packages without a courteous disclaimer that the speed you’ll get is shared between 50 other idiots that paid us! I own a wi-tribe 512Kbps with 12 GB limit, my average download speed is 50 KB/s. I got the same speed whenever I’ve used Nitro (Ugh the names these idiots use!)

    Long story short ProPakistani, for a rational and abused customer, you cannot gather any support and sympathy for these rich bastards.

  • usman

    i will always support grey traffic in Pakistan because i use it my self

    from bahrain indians can call india in bd 1 for 60 minutes

    bangladesh is same also like india

    and we pakistanis in 1bd only 20 minutes

    its all because of our corrupt government and companies
    pakistan mey to looting mela laga howa hey

    so why not support grey traffic

    long live grey traffic

    • Ahmad

      Usman, you can buy a stolen car in much cheaper rate. Why don’t you? That is also huge saving.

      • Bilal Iqbal

        but what the hell is making a normal car much more costly as compared to market just to earn extra profit for dealer…
        understood??? or just stood behind others…

  • Ali J

    Accurate Analysis..

  • nicejoke

    ye monoply is liay ha k oper jo log hen wo nalaiq hen. ye industry gurus k hath me kheltay hen or mazay kartay hen or karwatay hen. Asay to ni Dr ismail jesay gugu ko chairman bana dia ha.jisko terminate kia tha or us par inquiries b khuli the. or phir pemra ka chota ajkal member telecom bana hoa ha. yasar qader jesa banda dono hatho sa loot macha raha ha.jitni organisations hen ministry k under wo is ke corruption sa tang hen. member telecom ban k ye board ka director b bana hoa ha. in logo ko rules me disqualification or eligibility ka clause nai nazar ata. acting ban k mazay hn millions ke corruption alag or millions ka allowance alag acting charge ka. asay to ni fill karte ye MDs or ceos ke seats,bala in sa ziada competent koi ha hi nai pakistan me

  • Saeed

    Ssshhhh! They’re sleeping, can’t you see? don’t wake them up.