News Column

Telecom picking up pace with each passing year in Pakistan

January 25, 2014



Telecom - considered as tool for advancement - has now revolutionized the way people connect and interact as a visible change in information communications sector is picking up a pace with each passing year.

It is the sector that has reduced distances, transcended borders and brought people together in way never seen in the entire human history.

Traditionally Pakistan has been lagging behind in reaping the rewards of telecommunications technology, but last ten years remained crucial when expansion coverage areas and timely up-gradation of infrastructure to support more advanced infotainment solutions had helped changed the very dynamics of Information Communication Technology (ICT) in Pakistan.

Like previous few years, the telecom sector in the country also grew stronger in year 2012-13 with major indicators showed improvement.

Now tele-density of the country reached around 76 percent with main contribution from cellular sector and revenues were at all time high of Rs. 440.2 billion. Mobile penetration has reached 72 percent with around 129 million subscribers.

However, sector’s investment situation calls for an immediate influx of innovation in the form of 3G technology auction which can further improve the sector’s economic standing.

A regulator, Pakistan Telecommunication Authority (PTA), in its latest summary of year 2012-13 revealed Cellular Mobile Operators (CMOs) together added 8.1 million new subscribers to their networks. Cellular operators cover 92 percent of the land area via 35,889 cell sites across Pakistan.

Local loop sector has performed well as the total tele-density of both Fixed Line Loop (FLL) and Wireless Local Loop (WLL) services combined reached 3.6 percent at the end of 2012-13.

The WLL segment has grown considerably over the past year while FLL subscribers have also risen slightly.

The FLL and WLL segments are still being ruled by Pakistan Telecommunication Company Limited (PTCL). The tele-density of fixed and wireless local loop services stood at 3.6 percent as at the end of 2012-13 as compared to 3.3 percent at the end of 2011-12. After five years of continuous decline, the penetration of LL sector has reversed which is a healthy sign.

The PTCL has contributed a lot to increase the tele-density of both the FLL & WLL segment since the company also holds 95 percent share in the FLL segment and 40 percent of the WLL segment.

The dominance of PTCL in local loop sector is still very much intact and it performed well in the local loop sector during 2013. PTCL’s total local loop subscriber base stood at around 4.3 million.

The share of the incumbent in the local loop subscriber base has also reached 73 percent. The incumbent still holds more than 95 percent share in the FLL segment of the overall local loop sector. The subscriber base of local loop sector has reached 6.4 million during 2012-13 as compared to 5.87 million as of June 2012.

The broadband sector also showed reasonable growth with 2.72 million subscribers and 30 percent growth during 2012-13. The remarkable growth of wireless technologies is an encouraging sign for the sector.

Again PTCL currently leads the broadband market by a long margin with its EvDO services. Due to this, wireless technologies now own major share in the overall subscriber base as compared to fixed line for the first time ever in Pakistan.

The year also witnessed unprecedented growth in mobile banking as the indicators such as M-banking agents registered a growth of 141.6 percent, increasing from 26,792 to 64,716, and the growth in m-wallet accounts was 126.4 percent, increasing from 1.4 million to 2.4 million.

An official at PTA said M-banking segment of Pakistan has vast potential for growth in the coming years and Authority has developed procedures and mechanisms for receiving complaints and their subsequent satisfactory redressal.

During the period, PTA received 31,266 complaints against telecom operators, 98 percent of which were successfully redressed.

In 2012-13, the growing cellular subscribers, increased traffic and taxes encouraged telecom sector contribution to national exchequer, touching Rs. 124 billion mark. The revenues of telecom operators grew by 8.9 percent in 2012-13 up from Rs. 409.2 billion during same duration previous year.

The increasing revenues from telecom sector indicate the strength and size of the market despite the economic difficulties and tough competition, especially in the cellular sector.

Moreover, revenues of Long Distance International (LDI) operators grew by over 200 percent.

Telecom operators are now exploring new avenues to earn from, reducing dependence on the voice channels alone.

Throughout the period, the Authority remained focused on realigning its strategic plans towards meeting the changing paradigms of the telecom sector. With increasing subscriber base and emerging facets of the telecom sector, it performed its regulatory duties with professional approach.

The auction of spectrum/licenses for Next Generation Wireless Network (NGWN) services will be the pinnacle of technological advancement of cellular mobile services in the country and it has already accelerated the process to launch NGWN services in line with its vision for a technologically modern and financially stable Pakistan.

It is expected that influx of 3G technology into the telecom market will further boost the revenues of the sector.

Enumerating further, the PTA official also highlighted other endeavours including Mobile Phone SIMs sale documentation and verification processes.

All telecom players are bearing fruits of joint endeavours especially of a regulator and we need to have with more professional and consumer friendly approach in accordance with changing dynamics of the telecom sector of the country. Protecting consumers and maintaining an enabling business environment for telecom companies should be remained a key priority so that 2014 - another year success can be seen which would also be good omen for the sector.


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Source: Baluchistan Express, The


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