ISLAMABAD: The government has realised $279 million i.e. 33 percent of the estimated amount of $831.8 million from the Next Generation Mobile Services (NGMS) spectrum auction, after three cellular companies did not show interest in the process, while quoting price mechanism as a major hurdle.
The government sold 70.31 percent of 1800 MHz band spectrum i.e. 9 MHz out of 12.8 MHz.
As many as 3.8MHz (excluding 6.6MHz sub-judice) in 1800MHz and 15MHz in 2100MHz band (base price-$29 million/MHz) remained unsold.
The government had set a base price of $31 million per 1MHz for the 1800MHz band, and $29 million per 1MHz for the 2100MHz band.
The PTML (Ufone) had submitted a bid of $279 million for a 9MHz block in a 1800MHz band, and since there were no other operators participating in the auction process, the total proceeds from spectrum auction will stand at $279 million.
Major General Amir Azim Bajwa (retired), during a press briefing on Friday, said that in accordance with the timelines mentioned in information memorandum (IM) for the spectrum auction for NGMS in Pakistan 2021, the opening of application and sealed bid offers from the prospective applicants have been completed on 9th September 2021.
The PTA received bid from PTML (Ufone), after scrutiny of submitted bid, the PTA declares the PTML as winner of the auction process.
The PTA chairman said this will generate the revenue of $279 million (excluding advance tax). Government will receive 50 percent upfront payment of Rs23.44 billion within 15 days; out of which 20 percent of the said amount i.e. Rs9.38 billion has already been received on 9th September 2021.
Remaining 50 percent will be paid in five equal annual installments.
Total spectrum won by Ufone is 9MHz in 1800MHz band, which is 70.3 percent of the total offered spectrum in the said band during the current auction.
This addition will increase Ufone spectrum holdings from 6MHz to 15MHz in 1800MHz band.
This will help Ufone to provide enhanced quality and increase coverage footprint for voice and data services.
The PTA completed auction process with the assistance of internationally-reputed consultant, Frontier Economics, who was onboard since January 2021, and conducted thorough consultation with the cellular industry and other stakeholders, the chairman PTA added.
The government had constituted Auction Advisory Committee in October 2020 under the chairmanship of the finance minister.
Ministry of Information Technology and Telecommunication (MoIT&T) issued policy directive on 4th August 2021, under which the process has been completed.
Licence will be issued to Ufone, which includes enhanced network rollout obligations and quality of service standards to ensure consumers interest.
The chairman said it had set certain KPIs to ensure the quality of service and standards of the telephony and broadband services in the country.
He stated that a minimum benchmark speed for wireless internet is now being set at 4Mbps, and it will be mandatory for operators to offer (at the very least) 4Mbps speed on their 4G networks.
He further said the operators that failed to meet the minimum quality of service requirements would be penalised, and that would be applicable to all the operators in Pakistan.
The PTA will conduct regular QoS surveys to ensure that all operators fulfill the minimum quality and coverage requirements.
The PTA chairman claimed that all the operators had been consulted during the preparation of the IM of the spectrum auction, and said the PTA had taken all the measures to ensure that the conditions for the operators were eased to the maximum extent.
Copyright Business Recorder, 2021