Licence renewals of three mobile operators: Technical body to evaluate benchmarks

Prime Minister Imran Khan has constituted a technical committee to evaluate benchmarks for license renewal of three mobile operators and award of additional spectrum, from which the government is expecting to generate $1-2 billion revenue, it is learnt. Official sources revealed to Business Recorder that license renewal of two mobile operators is due in early May, 2019 and in October. The government has yet to come up with any policy guidelines in this regard which is causing uncertainty in the industry.
The technical committee is headed by Secretary Ministry of Information Technology and Telecommunication (MoITT) while officials from Pakistan Telecommunication Authority (PTA), Ministry of Finance, Law and Justice and Frequency Allocation Board (FAB) are members of the body. The committee was formulated after the consultant hired by PTA failed to complete an assessment on time, due to reported differences among PTA, FAB and IT Ministry.
The technical committee has been tasked to evaluate benchmarks, different models, legal and financial aspects and submit recommendations to the committee of ministers - comprising Finance and IT ministers. After the approval from committee of ministers, a final draft would be submitted to the federal cabinet for approval of the policy and later IT Ministry would announce it. Sources said that due to delay in announcing license renewal policy, telecom operators would have little time to make decisions on future investment and business plan, which is creating uncertainty in the industry.
Parvez Iftikhar, International ICT Consultant and Member of Prime Minister''s Task Force on IT & Telecom told Business Recorder that renewal decisions should ideally be finalized in 18-24 months prior to license expiry to ensure service and business continuity. The license of Telenor Pakistan and Jazz are due to expire in early May 2019, and according to telecom experts, the operators may face operational issues in case of failure to renew licenses within the stipulated time.
The license of Zong is due to expire in October 2019. All the three operators have submitted requests for renewal but decision on renewal terms is still pending. The licenses of the three cellular mobile operators were awarded by PTA under the cellular mobile policy for a period of 15 years in 2004. Two operators -Mobilink and Ufone - have already renewed their license for $291 million after the expiry of 15 year period. The remaining two mobile operators, Jazz (Mobilink) and Ufone are not due for renewal until 2022 and 2029 respectively.
Sources said that efficient completion of renewal process will generate favoruable market conditions but much will depend upon the new framework of license regime formulated by the telecom authority particularly with reference to award of licenses and spectrum of 3G/ 4G technologies to various operators. Clause 8.11 of Telecommunications Policy 2015 states that "Renewal of license and associated spectrum at the end of a license period will be as per the policy of the government. PTA will in timely manner initiate the process in accordance with terms and conditions of the license."
In case the renewal of licenses PTA will make recommendations to federal government (MoIT), within the timelines stipulated in the respective licenses. Other spectrum not subject to license renewal terms will be priced in accordance with the applicable spectrum pricing methods specified. Where spectrum payments for microwave and mobile spectrum have been introduced subsequent to the initial assignment of mobile spectrum, the spectrum fees associated with mobile spectrum will be determined under the terms of the applicable license.