Pakistan Telecom Sector Growing Faster than India: PTA Chief

Pakistan Telecommunication Authority (PTA) Chairman Dr Mohammad Yasin has said that Pakistan telecommunication sector has been growing faster than that of India with over 62 percent teledensity, encouraging the foreign direct investment (FDI), during an interview with Business Recorder. Dr. Yasin said that India lagged far behind Pakistan with 37 percent teledensity as compared to 62 percent in Pakistan.

He added that Pakistan’s FDI policy was much more liberal than that of India to attract more investment in Pakistan telecom sector. The PTA Chairman said that the ever-growing teledensity of Pakistan was giving new opportunities to the investors for better returns, especially in the field of data services. Services like mobile internet, mobile banking and Internet Protocol Television (IPTV) hold fortunes for any wise investor.

“Telecom analysts around the world still believe in Pakistan to be a lucrative market and Business Monitor forecasts that mobile subscribers in Pakistan would hit 100-million mark by next year”, Yasin said. The sector has been growing at a rapid pace where growth rates have become the hallmark. However, slow growth was witnessed for the first time ever last year, he added.

Although slow growth, of only 7 percent, was observed in mobile sector last year, this trend cannot be attributed only to saturation as there are factors like international financial crisis, devaluation of rupee, security situation and re-registration of SIM programme.

“We do agree that saturation is there, but only in metropolitan areas. Moreover, the people are still keeping more than one SIM. So, one can say that sector would continue to grow though not as fast as before”, he said. He said that PTA was trying level best to bring more growth to the sector and was taking every possible regulatory measure to ensure healthy competition beneficial to the telecom users.

“PTA has taken a number of initiatives which are proving to be very helpful, especially in the field of broadband proliferation, LDI re-emergence, and WiMax popularity”, said Dr Yasin. He further said that PTA was focusing on growth of broadband. Currently the number of subscribers is 0.4 million approximately, whereas growth rate of broadband services was 146 percent in 2008-09.

He said that WiMax has a brilliant future in Pakistan and this is further strengthened by the promising start of companies like Wateen, Wi-Tribe, etc. “With more companies jumping into the market, the competition level will rise to compel the companies to bring down the tariffs, especially CPE charge”, he added.

The PTA Chairman said that in addition, other technologies like Evolution Data Only/Evolution Data Optimised (EVDO) and WorldCall introduced in Pakistan by PTCL are gaining good momentum. He said that Mobile internet held a very bright future in a country where mobile penetration was more than 57 percent.

“However, the only setback that our mobile subscriber has is low literacy rate that hampers use of internet. Also, the lack of availability of local content is another reason, which could pose problems for wider adoption of internet by mobile community,” he added.

“PTA is now focused on content development and aggregation, especially for education purposes”, he said. Dr Yasin said that he did not believe that there was room for monopolies in the sector. “However, we do have to face the Significant Market Player (SMP) operator’s issues with rest of the players”.

“We do determine the SMP operator in each segment of telecom on yearly basis. We have also drafted competition rules that clearly protect operators from any anti-competitive practices by SMP’s”, he added. He said that looking at the current market situation where a feeling of price war was obvious, one could say that product differentiation could be possible on quality and easy availability basis.

Regarding improving ‘Average Revenue Per User’ (ARPU), he said that improvement in ARPU’s data service like m-banking or mobile internet would be the solution. “Maybe, 95 million mobile users will be waiting to open their accounts”, he added. He further said that currently in Pakistan five cellular operators have healthy competitive environment.

“Due to growing revenues and fair competition in the market, I believe that operators will continue to provide telecom services in Pakistan and value-addition and innovation is way forward for telecom operators’ growth”, he said. About 3G service in Pakistan he said, “Each and every technology and service has its future, and it caters a potential segment of the society.”

Via Business Recorder