The policy for auction of 3G licenses has eventually reached the federal cabinet, likely to be presided by Prime Minister of Pakistan today, for the final approval of the bidding plan and further execution of 3G rollout in the country.
As we discussed earlier, Government of Pakistan desperately needed to auction 3G licenses in order to meet it’s fiscal targets. Government is aiming to generate at least USD 900 million dollars from the license auction.
On other hands, cellular operators have consistently shown reservations over the 3G License auction in order to avoid further investments. They say that further fund injections isn’t viable for a market like Pakistan where Average Revenue Per User is as low as USD 2.48 per month.
However it now looks like that the 3G auction will be held in less than 6 months to make the required money to meet budget deficits.
Reportedly, government is working on two options for auction of 3G licenses. The government under option number one will offer up to 10 Mhz frequency to telecommunication companies with license and minimum USD 420 million and maximum USD 800 million revenue is expected to come through the auction.
Under the option number two, the government will offer frequency ranging between 20 Mhz and up to 35Mhz to telecom sector with licenses through open bidding and minimum USD 749 million and USD 1.2 billion revenue is projected to come.
The federal cabinet in its today’s meeting would be requested to approve the modalities of the auction of the 3G licenses with possible decision on any one option.
It is learned that government may invite international telecom companies to bidding, in addition to 5 local companies already operating in the country.
This is a developing story and more updates are to arrive after today’s meeting!