Last update: Mon, 16 Jan 2017 05pm
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Broadband in Pakistan

The Pakistani market seems to have the basic ingredients for rapid adoption of broadband internet. On the demand side, not only is there a huge, addressable market of over 100 million adults and nearly 30 million households that are up for the taking, but an encouraging trend also seems to be emerging where more and more people are using online means to stay connected and go about their lives and work.

On the supply side, the market not only boasts of multiple broadband service providers - both big and small in size, who have been operating for many years now - but also possesses deployments of both wire-line and wire-less technologies, some of which have reached fair amount of scale in recent years.

On the government side, PTA has remained an engaging regulator. Moreover, some very specific broadband-related projects have been launched by the telecom-centered Universal Service Fund (USF) which seems to have prioritized broadband development.

Yet the broadband penetration in the country is growing at, what the telecom watchdog has aptly called a leisurely pace. PTAs recently released Annual Report (2012) estimated that broadband penetration rate stood at a paltry 1.2 percent in June 2012 (compared to 0.89 percent seen a year ago). There were 2.35 million broadband subscriptions as of December end, 2012, PTAs latest estimates show.

Some industry leaders and ICT experts maintain that one shouldn read too much into small numbers, but rather look at recent years exponential growth. PTAs report indeed highlights that between June 2007 & June 2012, annual growth rate for new broadband subscriptions averaged 127 percent. A record 0.6 million subscriptions were added in FY12, though the YoY growth rate had slowed down to 41 percent.

The growth rate argument is accepted. But when even the most bullish estimates are putting Pakistans online population at a number around 30 million, doesn that indicate a tremendous opportunity to provide broadband services to the unserved areas, and create demand where there is none? Broadband, with its scalable and high quality, fixed and wireless services, is ideally suited to push the envelope here.

As the report identifies, good investments are being made for broadband penetration. For instance, through the USF, Rs22 billion have been spent in rural areas, which, among other projects, helped lay down 7,400 kilometres of fibre optics, gave away half a million broadband connections, provided broadband service to schools and libraries, and offered subsidized broadband tariffs in project areas.

There are challenges that have come along the way so far, which have been pointed out (but not discussed in detail) in the PTA report. The factors that have been limiting broadband uptake include, on the consumer-side, low literacy rates, limited local-content web services, and public awareness. On the BSP side, issues are of high cost of entry, device prices, poor fixed line infrastructure, etc.

Surely, the BSPs are aware of these (and various other challenges, like low customer loyalty, focus on urban areas and resulting competition, etc.). To address these issues, the BSPs, PTA and the government need to agree on a joint, actionable plan to achieve a certain level of broadband penetration within a timeframe. Perhaps, a roadband socioeconomic impact study may put things into perspective.