PAKISTAN.teledensity reached at 71.7% showing growth of 5% in FY2012

ISLAMABAD ( SPECIAL REPORT)

Teledensity is one of the foremost indicators of a country’s telecom outlook.  Total teledensity of the country reached at 71.7% showing growth of 5% in FY2012. Cellular mobile sector is the most important part of the telecom profile of Pakistan as it constitutes the major part of overall teledensity figure. The total mobile subscribers at the end of FY2012 stood at 120.1 million with growth rate of 10.3%, slightly better than that of previous year. Mobile penetration stands at 68.4% showing a growth of 5.8% over the last year. Cellular sector of Pakistan is a competitive market as confirmed by the Herfindhal-Hirschman Index (HHI) for the sector. As a result, companies kept on increasing their network coverage to gain the first entrant advantage as cell sites increased to 33,920 during FY 2012. In addition, PTA regularly explores new growth avenues for the cellular industry such as mobile financial services where PTA has collaborated with State Bank of Pakistan to use mobile platform to reach the 85% unbanked population of the country. The daunting task of formulating the Regulations. Its showed in annual reports of Pakistan Telecommunication Authority of 2012.

The report  reveal that PTA always keeps national and public interests at the apex of its regulatory schema and the regulator’s efforts to reorganize the SIM sale and subscriber verification procedures need no introduction. This year, PTA took the next step in this regard as automation of pre-sale documentation project rolled out in May 2012. For consumer health safety, PTA conducted BTS health hazard survey to ensure that mobile signals do not harm any individual in the nearby areas. Similarly, PTA took stern measures to restrict cross border interference and sale of Afghan SIMs in Pakistan territory. For consumer protection, PTA has already set up a dedicated department and revamped its complaint management system to ensure consumers reach the Authority conveniently. During the FY2012, PTA resolved 33,310 consumer complaints received against mobile operators, PTCL, LDIs, WLL, ISPs and MNP. In order to gauge consumer perception about telecom services, PTA launched consumer perception survey system and shared the results with general public. Besides approving consumer friendly package offers, PTA also prepared a comprehensive tariff awareness guide for consumers highlighting important aspects of tariffs and packages. For development of rural connectivity in far flung areas, PTA launched the cellular village connection trial (CVCT) project in Neelum Valley, AJK. Recognizing the pivotal role of agriculture in country’s economy, PTA organized a seminar on telecom’s potential to assist and develop the agriculture sector of Pakistan.

To ensure regulatory compliance by the operators, PTA issued enforcement orders to the operators related to different matters. PTA took notice of increasing helpline assistance service charges by operators and refrained them from doing so. PTA also settled issues pertaining to broadband which were mostly related to PTCL’s anti competitive practices. As part of its mandate and being a quality driven organization, PTA carried out a number of surveys related to broadband, helpline assistance, MNP and Internet bandwidth providers. The survey results were shared with the public for information and areas of improvement conveyed to the relevant operators. PTA also blocked websites and other internet links which are considered offensive and hateful towards the sentiments of the general public on regular basis.

All these regulatory efforts of PTA had a positive impact on the sector economy as telecom revenue also spiked to Rs. 411 billion showing a growth of 13% during FY2012. Telecom contribution to the national kitty was the highest ever this year i.e. Rs. 132.51 billion.  Investment remained on the lower side this year; however, this would be a temporary phase as companies prepare for massive investment in the 3G arena soon. During FY2012, total telecom imports in the country increased by 24.5% to reach US$ 954 million mainly due to high imports of mobile handsets.

Teledensity is one of the foremost indicators of a country’s telecom outlook.  Total teledensity of the country reached at 71.7% showing growth of 5% in FY2012. Cellular mobile sector is the most important part of the telecom profile of Pakistan as it constitutes the major part of overall teledensity figure. The total mobile subscribers at the end of FY2012 stood at 120.1 million with growth rate of 10.3%, slightly better than that of previous year. Mobile penetration stands at 68.4% showing a growth of 5.8% over the last year. Cellular sector of Pakistan is a competitive market as confirmed by the Herfindhal-Hirschman Index (HHI) for the sector. As a result, companies kept on increasing their network coverage to gain the first entrant advantage as cell sites increased to 33,920 during FY 2012. In addition, PTA regularly explores new growth avenues for the cellular industry such as mobile financial services where PTA has collaborated with State Bank of Pakistan to use mobile platform to reach the 85% unbanked population of the country. The daunting task of formulating the Regulations for Technical Implementation of Mobile Banking, 2012 while keeping all the stakeholders on board, has reached its final stage and it is expected that mobile banking services of all the banks/operators will soon be interconnected.

Broadband proliferation is another area of concentration for regulator which presented stellar growth during FY2012. Broadband subscribers in Pakistan crossed the two million mark to reach 2,101,315 showing 41% growth rate during FY2012. The challenge for PTA though is to elevate the broadband penetration which currently stands at 1.2%, up from 0.89% at the end of previous year. Wireless technologies like WiMAX and EvDO could be the game changer as these are already outperforming the primitive fixed broadband options. Similarly, local loop (LL) segment of the telecom industry is gradually progressing where customers are turning towards wireless solutions such as mobile cellular services. LL teledensity stands at 3.3% in Pakistan, which consists of 1.7% for FLL and 1.6% of WLL as of June, 2012. There are a total of 5.87 million local loop subscribers, 74% of which, belongs to the incumbent PTCL. The Long Distance and International (LDI) is another pillar of Pakistan telecom sector, responsible for carrying international traffic. The LDI networks recorded an all time high international traffic during the FY2012, i.e. 20.2 billion minutes as compared to 11.3 billion minutes in the previous year, showing 79% growth. One of the many challenges facing the Authority in the LDI sector is to curb the menace of illegal traffic and to recover its outstanding dues. In this regard, PTA notified the Policy Directive issued by MoIT regarding International Clearing House (ICH) exchange wherein Accounting Settlement Rates (ASR), LDI share and APC for USF have been revised.

PTA places special emphasis on research to transfer and implement new technologies as well as to find out ways of better management of the telecom sector. PTA is also widely regarded as one of the best examples of a sound regulatory regime; therefore, international and national organizations collaborate with PTA to conduct trainings, workshops, seminars and forums etc. In this regard, PTA joined hands with a number of local and international organizations such as ITU, LIRNEasia, CGAP, APNIC, Huawei, Ericsson etc to conduct seminars/workshops/ forums relevant to the emerging challenges of the telecom industry. Moreover, PTA officers regularly undertake research studies to stay one step ahead of the emerging technological and regulatory challenges. The studies relate to merger of LL & LDI license, inter-cellular network utilization for SMS traffic, regulatory reforms impact on economy, broadband penetration in Pakistan, QoS of international roaming, cyber filtering, LDI infrastructure and capabilities etc. PTA also takes care of its work force by organizing various local and foreign trainings and also sends its officers for representation at various international fora.

PTA, as caretaker of the telecommunication industry of Pakistan, believes in minimum regulatory intervention without compromising on quality of service (QoS), consumer protection, investor concerns and national interests. The Authority shall continue to govern the telecom sector with watchful eye and deal with emerging issues of the sector with professionalism and reconciliation with all stakeholders

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