3G: many a million

The more the merrier. Since mobile broadband rollout started around the middle of last year, the four 3G operators have collectively, on average, added over a million 3G users each month. Calculated from the Pakistan Telecommunication Authority’s (PTA) latest data, there were 6.37 million 3G users as of December 2014. This number includes Ufone’s November-end subscribers – the operator’s December-end 3G subscription figure wasn’t published – so the actual tally at six-month close could be around 6.5 million users.
This is good growth after a six-month period. Operators are seen busy developing a niche segment into a mass market. Telenor’s subscriptions seem the hottest right now. The most-consistent operator of the cellular yore added over one million 3G users in December, doubling its user-base in a single month. Remaining three operators are also showing double-digit growth on a month-on-month basis.
Folks are now wondering how fast will be the 3G uptake. The answer to that question lies as much in the consumers’ minds as inside the operators’ snazzy establishments. Much as other young folks, Pakistan’s youth, which is a population majority, wants to stay connected and on top of happenings in their circles and beyond. That is a market ripe for the data intervention. Cheaper smartphones are enabling the uptake. Mobile phone retailers are now seeing more smartphone sales than feature phones.
Telcos didn’t just buy expensive 3G licenses. They’re investing in rolling out those services as well. As per SBP’s latest data, telecommunications sector attracted $856.7 million in gross FDI inflows, about 55 percent of Pakistan’s total gross FDI inflows in 1HFY15. The inflows are 755 percent more than same period last year. Moreover, net FDI inflows (gross inflow less outflows) were $100 million in this period, as compared to a negative $188 million in the year-ago period.
Most of that FDI is said to be making its way to 3G and 4G rollouts. Then, some operators are borrowing from local sources to expand their networks. So the real quantum of mobile broadband investment is supposedly high and may be revealed in the year-end numbers.
It would be incorrect to assume that 3G growth curve would mimic that of 2G. But the numbers so far are encouraging. There are signals that the growth phase may intensify in the next six months. At this pace, overall subscriptions could come close to 20 million users by the end of one year of service launch (June-end 2015). That should ameliorate the sector’s average revenue per user, whose health is critical to the provision of quality service.