Quandary for 3G in Pakistan Continues

problem solve-thumbAnother month goes by and the debate over the sale of 3G licenses gets a headline. For a country that led the region in terms of GSM implementation, we have taken our usual approach to life by settling into a silo and remaining comfortable with what is there.

Across the border, 3G will celebrate a year of operation by the time the clock strikes 2011 out. And this is the same country where MNP (mobile number portability) was the biggest rollout of 2010.

It is hard for a balanced comparison to be made on Pakistan’s cellular industry with the surrounding nations. Factors like population and GDP vary in large proportions. Take cellular penetration as an example; both India and Pakistan officially report a 60 to 65% mobile communication uptake, but that percentage represents almost 600 million subscribers for the former and just 105 million for the latter.

Out of all these subs, Pakistan reports only 5% to be data users, whether utilizing Blackberry services or GPRS/EDGE. Across the border, Vodafone India alone has 26 million data subscribers.

Moving to factors like economy and social setting, the climate for investment is greatly hampered in Pakistan. The boom times of 2005 to 2008 cannot be replicated and the local cellular companies are well aware of the reduced returns on any capital expenditure.

With all the operators being under foreign ownership in some way or form, the current strategy seems to be aligned towards reducing costs and extracting as much profit out of the re-milked cow of a consumer.

But the mobile communication industry is a rapidly innovating one, which has moved leaps and bounds in the last decade. Even the African continent has been at the forefront of the bandwagon, in spite of the lack of development in other sectors.

The consumer perspective in Pakistan is to question the reluctance of the operators to innovate and remain at par with international standards, on both voice packages as well as faster data options. The operator response is to question the high cost of licenses and infrastructure, as well as the lack of high-paying customers in a country where the ARPU is under $3.

What has eventuated is a stalemate. The lack of alternative options by the PTA, which appears resigned to using the telecommunication industry as the principal earner of FDI for the country, means that the local mobile operators will continue to delay the 3G process as long as possible, especially keeping in mind the cost of the license being propositioned.

The idea of inviting an international company to enter the already saturated market may be a little too optimistic.

For now, the consumer has to make do with what is available. While the line of high-end Smartphones continues to roll out, it will some time before equivalent level and variety of services arrive for them.

  • This is not a single example. Take paypal licensing. Govt. is not allowing PayPal to start operation in Pakistan. I don’t know what the hell Govt wants to show. If you don’t do anything, for God’s sake let others do for the people of Pakistan.

    • Interesting info regarding Paypal, I was under impression that Paypal itself doesn’t want to start in Pakistan. Would you like to share more on how government is not allowing Paypal?

      • Government is not interested in updating and cleaning up laws and regulations related to financial theft and fraud.

        • Bro according 2 my knowledge State Bank Of Pakistan is not interested in becoming a broker thats y PayPal is not in Pakistan

          • Does that make sense to you? The State Bank saying “no” to potential of INCOME to country?

            • bro our govt is not interested to make country progress they want only looting
              they demanded Paypal to pay them to get licensed
              and refused and State bank of Pakistan is under Govt of Pakistan
              hope u under stand

              • And now the slogan has also been changed
                “Pakista ka mutlab kya”… “laa laa idher laaa” :D

  • there is strong lobby in Pakistan against any modernization especially 3G may be its the same lobby who is against “camera mobile”

  • same pathetic approach to compare each and every thing with India. every country has its own limitations. Indian population is 7 times more than Pakistani Population. i am sure they have cheaper rates for call and data if we compare that (just search the internet for a while and you can see 5 or 10 GB data for 100 or 150 rupees on 3G). Petrol is almost 100 rupees in india and same goes for Salt, so we should purchase petrol for 100 and salt for 150?

    • Not sure how you reached this conclusion, as I can clearly see the writer mentioning that it is not a comparison but a weightage.

      Pakistan was first in GSM and other VAS. Then it went into slumber. As far as population is concerned, countries with lesser population have progressed further as well in telecom, Singapore, Thailand, etc.

      Price of Petrol in India is US$1.40, while in Pakistan it is US$0.97
      Please learn to do comparative analysis first.

  • @Woohoo Shoukat Aziz was the best man for comparative analysis in the history of Pakistan. look at the capital repatriation ratio for telecom sector, this is the heaven on earth for them. Telecom sector should invest major part to enhance their capability rather capital repatriating. should govt pay them for capacity building? grown up man and think yourself rather upon figures.

  • PTCL’s monopoly and lobby is high time active in this regard but leave that thing aside, people are dying of hunger in the streets, talent is going down the drain with no industry or focus on job production. I fail to understand what will 3G/4G bring to the common man and his miserable life that too with such outstanding and mind-blowing politicians in parliament?

  • For the lovely debate, 3G license is SOLD in Pakistan and somone is testing it on random sites not even titled as “Hot Spots”.

    Interesting fact about 5% data users is that only 7% of them have 3G phones.

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