Amid Economic Crisis, Telcos Push to Delay 5G Launch in Pakistan

The launch of 5G network services in the country has seemingly been delayed as mobile companies have expressed a lack of interest in 5G technology in the near future because of clear economic issues such as import restrictions, fuel shortages, PKR depreciation, and higher spectrum fees.

According to an official document seen by ProPakistani, the Pakistan Telecommunication Authority (PTA) has conveyed these reasons for the expected delay in 5G technology to the Ministry of Information Technology and Telecommunication.

The report recalls that in December 2021, the IT ministry issued draft 5G policy guidelines for stakeholder consultation. Feedback was shared by the ministry with PTA in April 2022. The telecom regulator evaluated market readiness for 5G in Pakistan in light of the feedback received and observed that cellular mobile operators (CMOs) didn’t show much interest in the launch of the technology any time soon.

According to the document, the PTA received the following reasons from CMOs as major impediments to the 5G rollout:

  • Uncertain economic situation, import restrictions, an abrupt rise in fuel and electricity prices, PKR depreciation, high load-shedding, and increasing inflation restricting CMOs from properly planning investment in relation to 5G
  • 5G spectrum affordability is considered a major challenge. Operators are requesting reasonable spectrum fees and relaxation in payment terms and license obligations
  • Taxation relief, ROW policies, low 4G penetration, 5G devices affordability, spectrum availability (exact bandwidth) along with the price in PKR and payment terms clarity
  • Facilitation from the government to improve business sustainability of the telecom sector by giving incentives to the industry

A PTA spokesperson, when contacted, said that the decision for the launch of 5G is with the government to make.

The spokesperson added that PTA is ready to go ahead with the launch, however, it is awaiting the policy directive for the auction of 5G spectrum, after which PTA could get the remainder of the task executed without any delay.

While the government contemplates policies on whether it wants to bring 5G for revenue or socio-economic development, the report highlights that 4G penetration in Pakistan is at 55.6 percent, while the fiber penetration rate to towers (towers that are connected with fiber) is at 11.4 percent.

The report cites the Mobile Connectivity Index 2021 showing that as of June 2022, Pakistan lags behind India and Bangladesh in terms of mobile connectivity.

Comparison of Mobile Connectivity Index 2019 & 2021 By GSMA
Country Years Index Score Infrastructure Affordability Consumer Readiness Content and Services
Pakistan  2019 39.84 49.88 43.71  25.25  45.76
2021 43.96 55.41 46.52 26.52 54.60
India 2019 56.84 55.31 65.41 44.01 65.57
2021 61.31 58.23 69.40 47.09 74.25
Bangladesh 2019 45.62 53.13 47.91 38.9 43.73
2021 50.86 57.40 50.15 44.40 52.35

 

Need of the Hour

Telecom operators have stressed increasing 4G penetration for a successful 5G launch. They said there should be maximum spectrum availability, especially in key 5G bands of 2300 (n40), 2500 (n41), and 3500 (n78) MHz at affordable prices and payment terms.

The operators requested relaxation in 5G spectrum usage terms and conditions and license obligations as per global practices, including an affordable device ecosystem for smartphones, routers, and wearables by reducing taxation was fundamental for a successful 5G launch. They also asked for support from the government to resolve RoW issues which are creating hurdles in fiberization.

The report said Pakistan needs to materialize its 5G award plan at the earliest. The government must clearly identify its objectives for the launch of 5G be it increasing broadband proliferation, overall socio-economic development, or revenue generation.



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