A Roundup of Major Developments in the Telecom Sector in 2018

2018 was a different year for the telecom sector with few key developments including expansion of 3G/4G mobile services, consistent growth in customer base and their utility of the services.

Below are the few major developments of the telecom sector in 2018.

Transition in Leadership

PTI’s government along with its ally parties formed the government in the center. Dr Khalid Maqbool Siddiqui was appointed as the Minister of IT and Telecom.

In 2018, the federal government also appointed Maj. Gen. (Retd) Amir Azeem Bajwa, Member Technical at Pakistan Telecommunication Authority, while Dr. Khawar Saddique Khokhar was appointed as the Member Compliance. Amir Azeem Bajwa is likely to assume the office of PTA chairmanship.

Consumers’ Year of Tax Relief

Supreme Court of Pakistan made a landmark decision this year by abolishing the withholding tax of 12.5 percent on recharge using prepaid cards and bills for postpaid connections of mobile phone customers.

This was a major relief for the public which used to pay heavy taxes to the government despite the fact that millions of customers belong to the low-income group and do not fall into the taxpaying category.

Not only were the taxes removed but services charges of mobile phone companies, which varied around 7 percent, were also waved off.

The double relief ultimately increased the consumption of services and subsequently translated into economic activity.

Operators’ War To Attract Customers Through Offers

Operators were at war in 2018 to attract the most number of subscribers with their packages and special offers. But they were cautious in their approach not to indulge in a cut-throat competition as they did in the past.

Jazz introduced its lowest data package of Rs 999 in the market. Its rival, Zong did not revise down the price of its existing package but it did increase the data limit of its packages. It revised the limit of its Rs. 1,500 package from 24 GB to 36 GB.

Telenor offered a 50 percent discount offer on the price of its particular device. It also offered a higher data limit for the next couple of months on the purchase of different packages for its dongle. These sort of offers were seen from various companies to attract new customers and it worked well to meet the target in such a competitive environment.

Telcos & Infrastructure Expansion

Telecom operators expanded and upgraded their networks in 2018 to provide quality services and increase their coverage area.

Zong claimed that it set up more than 10,000 towers exclusively for 4G services. Telenor Pakistan also claimed to upgrade its service to 4.5G at the end of this year.

Ufone introduced its 38 self-service booths in 11 cities to facilitate its customers through value-added services.

DIRBS Launch

PTA officially launched Device Identification, Registration and Blocking System (DIRBS) in May 2018, aimed at discouraging the use of smuggled and counterfeit handsets in the country. The authority issued its first deadline of October 20 to block handsets and then extended it to December. The implementation of the system was postponed to create awareness among public and traders of handsets.

PTA’s Initiatives

PTA also launched a re-designed complaint management system in November 2018. The aim of the re-designed system was to provide ease to the general public in lodging online complaints through a user-friendly interface.

The authority revealed its plan to launch 5G test trials in the country. In this regard, it issued a draft framework for the development and testing of future technologies, especially for 5G wireless networks, in Pakistan.

Failure Of a Million Dollar Deal

The million dollar deal between Jazz and edotco failed. The deal could have brought an estimated FDI of $940 million. Under the deal, edotco was to acquire 13,000 towers from Jazz, which are currently operated by Deodar Pvt Limited.

Controversy of Jazz-Warid Merger

After nearly two years, Auditor General of Pakistan (AGP) termed the grant of Non-Objectionable Certificate (NoC) for the merger of Mobilink and Warid as unjustified. It raised serious questions over the merger between Jazz and Warid and this might lead to an inquiry against the stakeholders and policymakers in the future.

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