A decade seems time enough for something to get old and its charm to wear off. Pakistans cellular subscribers are being served on second-generation (2G) mobile networks for about a decade now. The voice-centric 2G networks have been replaced by data-centric 3G networks in more than a 150 countries. Afghanistan is one of them, but not Pakistan. Many countries are now moving to deploy 4G networks.
Stagnation is written all over the latest statistics released by Pakistan Telecommunication Authority (PTA), which show that registered cellular subscriptions reached about 122.12 million as of March end this year. An addition of 1.9 million subscribers was recorded in 9MFY13, which is the lowest since sector was deregulated nearly a decade ago, and fares poorly compared to FY12 addition of over 11 million.
The sharp slowdown in subscriber acquisition this year can be explained by the fact that late last year; PTA had barred the mobile network operators (MNOs) from selling new Sims through their franchise networks and third-party retail outlets till installation of Biometrics Verification System. Moreover, operators had been ordered to cleanup unverified and illegal Sims from their networks.
The mobile telephony sector seems to be caught in a rut. Though the MNOs earned nearly Rs300 billion in revenues with a growth of 14 percent in FY12, the average revenue per user only grew by 2.6 percent on a year-on-year basis. Operators have ventured out in related segments such as branchless banking, yet their core business needs a revival of sort, which 3G services are capable to deliver.
As per telecom policy, Pakistan was supposed to migrate to the 3G networks, starting from the year 2008. Once, a leader in regional telecom arena, Pakistan is now a laggard.
Hence, Pakistanis have, for way too long, been stuck with the 2G networks which are primarily designed for voice calls, texts and basic internet use. Those who have experienced 3G connectivity overseas are found yearning for the 3G networks to be rolled out in Pakistan, which would give unique experience to making calls and sending texts, and faster speed and quality to internet surfing on mobile phones.
But its never too late to start, they say. A new federal government is about to take over and there are high expectations given the attention the ruling party paid to the ICT industry in its manifesto. The industry needs a full-time Minister of IT, along with competent and independent professionals to run the regulatory affairs, in order to get things done effectively and transparently.
By learning from the previous governments mistakes, the incoming government can quickly kick start the stalled process of the 3G spectrum auction. The freed up radio frequency spectrum, which is about 30MHz in the 1900/2100MHz band for 3G license, and 7.38MHz in the 800MHz band for Instaphone (defunct) license, remains unassigned. PTA has done a lot of auction-related work which can be built on.
It would be interesting to see which technology the PML-N government prefers eventually. In its manifesto, it seemed inclined towards introducing 4G/LTE in Pakistan instead of 3G, for the "window of opportunity to deploy five years old 3G has passed."
That may not be an issue if the government conducts a technology-neutral spectrum auction in which winning operators can choose which technology to deploy. However, governments insistence on deploying 4G networks may be an issue, for some MNOs are said to have already invested in 3G-compatible infrastructure. Time will tell which way the cookie crumbles, but one hopes the time comes sooner.
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Cellular sector Landscape*
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Rank MNOs Market Net
shares subscribers
(%) (mn)
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1 Mobilink 29.74 36.32
2 Telenor 25.25 30.84
3 Ufone 19.33 23.61
4 Zong 15.41 18.82
5 Warid 10.27 12.54
Total 122.13
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(*as of March 2013)
Data source: PTA
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