Telecoms, internet in Pakistan

Broadband Faces Obstacles in Pakistan

High rates, poor infrastructure primary culprits

Muhammad Jamil Bhatti
Published 2006-12-20 16:22 (KST)

Internet usage has tremendously increased throughout Pakistan during the last couple of years, with users reaching a record number of 12 million. Not only young adults but children, the elderly, and even blind people are using it.

Internet Service Providers (ISPs), which were giving attention only to Karachi, Lahore, and Islamabad, have now extended their services to other cities of the country. Internet service is currently being provided to more than 2,389 cities and towns in Pakistan.

According to the report of Pakistan Telecommunication Authority (PTA), the prices of personal computers (PCs) have been decreasing, and thus more people have PCs at their residences or workplaces. Therefore, people are now able to connect to the Internet at their residences or workplaces using cheaply available Internet cards. Internet cards are available in the market for as low as 2.5 rupees (US$0.04) per hour. But the Internet speed is creating more headaches and problems for the users. The usage of Internet cards has also affected the growth of net cafes.

On the other hand, broadband services growth is also slow due to high tariffs, lack of awareness among consumers, and paucity of service providers. The Pakistan Telecommunication Authority (PTA) undertook a major initiative to facilitate the development of broadband services, by permitting all ISPs to offer broadband. The government announced a Broadband Policy to support the availability of affordable and high-speed Internet. The government also encouraged private sector investment in these services. With this policy, the government was looking at a target of 500,000 broadband users within five years. But, in spite of all efforts and policies, broadband penetration growth in the country was slow. There are only 56,611 broadband subscribers (DSL), in the country, with the largest share going to 13 major ISPs.

DSL services are available in selected areas of the major cities and provincial headquarters of the country. Worldcall is considered the only main cable operator providing broadband services in Pakistan. Some other cable operators also provide broadband services to consumers. For the last few months, they have been campaigning to raise consumer awareness. Some corporate customers in Pakistan, which cannot gain other modes, are using satellite broadband services, which have very high tariffs.

PTA has been in touch continuously with the industry to ensure the enforcement of all regulatory measures to enable broadband proliferation. There are some major problems obstructing broadband services growth in the country.

Firstly, the quality of copper in Pakistan is not good and some copper cables are in very bad shape. Faulty distribution poles and cabinets, and difficulties in sharing Pakistan Telecommunication Company Limited (PTCL) resources like cables and ducts are also a big hindrance.

Secondly, there are some issues regarding PTCL’s local loop unbundling, transmission media, collocations, and Optic Fiber Access Network (OFAN) from PTCL.

Thirdly, the line rent on DSL connections charged by PTCL is considered overly burdensome.

Fourthly, the consumers are not well aware of the benefits of broadband services in terms of avoiding telephone charges, time saving, and convenience.

Fifthly and most significantly, the PTCL monopoly is playing vital roll. PTCL’s prices are very high and constitute the major share of the total cost to service providers.

Lastly, broadband service tariffs in Pakistan are many times higher compared to those in some other countries and not affordable for common people.

Lack of usable infrastructure and high broadband tariffs are being considered as the chief hurdles for broadband proliferation in Pakistan. Regulator, PTA and the government are trying hard to overcome these problems by lessening bandwidth rates and solving other problems.

Three companies — Multinet, Wateen, and Worldcall — are deploying fiber-optic networks throughout the country that should be helpful for broadband growth. In addition to existing SEA-ME-WE-3, two extra undersea cables have been deployed in Pakistan to secure international connectivity. Worldcall is introducing Wimax for wireless broadband.

Considering the expected reductions of bandwidth rates, elimination of other hurdles, and infrastructure development, it is expected that broadband services will be accessible widely and at affordable prices in the coming years.

On the other hand, a Canadian company. Infosat Telecommunications, recently invested in telecommunication sector of Pakistan.

Infosat, partnered with Pakistan’s Comstar ISA Ltd., is going to launch the first broadband satellite hub in the country.

It is hoped that the broadband satellite hub will also be able to provide Internet access to remote areas of the country.

©2006 OhmyNews

Pakistan beats India in telecoms regulation

M Rajendran

New Delhi, December 20, 2006

It is not only in cricket and hockey where India gets beaten by Pakistan, it seems.

In a study comparing telecommunications industry regulators of the two countries, Pakistan has beaten India in five of the six parameters surveyed, with India winning on the only on criterion — low price.

A survey by research agency LIRNEAsia says Pakistan overtook both India and Sri Lanka in basic telecom measures in fixed and mobile services, such as transparency of licensing; information provided to applicants about the terms, conditions, criteria and length of time needed to reach a decision on their applications; licence conditions; mergers and acquisitions; and niche licences.

The ‘Telecom Regulatory Environment, 2006′ survey conducted by Indonesia-based LIRNEAsia suggests that the Telecom Regulatory Authority of India (TRAI) needs to improve its regulation in interconnection and anti-competitive practices.

The survey for the fixed and mobile telecommunications sector was conducted for 13 months from June, 2005.

In overall measurement Pakistan scored 2.9 on a scale of 5 for fixed line services compared with India’s 2.7. In mobile services it scored 3.1 against India’s 2.9 points.

India’s prominent neighbour in South Asia is also ahead in offering timely, transparent and non-discriminatory access to spectrum allocation, numbering and rights of way, frequency allocation, telephone allocation and site rights.

Speaking to Hindustan Times, Professor Rohan Samarajiva, executive director LIRNEAsia said, “The results of our first survey on telecom regulatory environment (TRE) show that TRAI and Department of Telecommunications are doing well on the various parameters but need to improve on spectrum, interconnection and anti-competitive prices.”

The first TRE survey which is likely to be now conducted annually revealed that on the interconnection parameters such as ensuring major operators provide the link at any technically feasible point in their networks, TRAI has taken efforts at the recommendation level but not at the implementation, points out Payal Malik, senior researcher with LIRNEAsia.

TRAI chairman Nripendra Misra told Hindustan Times that he had no comment to offer as he had not seen the study.

Commenting on the findings, Mahesh Uppal, a telecom analyst said, “We still have to go some way on our regulatory parameters. Our greatest advantage is that we have much higher levels of raw competition on most of our markets, compared to our neighbour.”

On parameters such as ensuring that the quality of interconnection offered by an operator is similar to its own, reasonable charges for interconnection rates, sharing of revenue on incoming and outgoing calls, payment for cost of interconnection links and technical disruption, Pakistan has scored more over India.

India also scores less than Pakistan even in administration of the universal service program/fund to aid remote areas not covered by commercial expansion in a transparent, non-discriminatory and competitively neutral manner.

PSEB, Malaysian firm to build IT parks

By Imran Ayub

KARACHI: Pakistan Software Export Board has signed an accord with a Malaysian firm to build IT parks in†Islamabad, Karachi and Lahore in a move believed to attract foreign interest in the emerging industry of the country. Official sources said the deal was part of Prime Minister Shaukat Aziz’s directives to the Ministry of IT and Telecom, calling for urgent steps to start the construction of IT parks in major cities.

“We have signed an MoU (memorandum of understanding) with MDeC (Multimedia Super Corridor Development Corporation), a government of Malaysia entity, which promotes the IT†industry,” said Yusuf Hussain, Managing Director PSEB, who returned from Malaysia last week.

“We intend to build IT parks on plots of land ranging from six to 13 acres in†Islamabad, Karachi and Lahore.”

He said the Malaysian visit was aimed at meeting with developers, who were interested in building IT parks in Pakistan on build, operate and transfer (BOT) basis, besides facilitating cooperation in other areas†including venture capital funds and trade in IT services.

“There is immense scope†for collaboration with Malaysia on IT. We also visited Cyberjaya, a leading IT city of the†world, to learn from their experiences,” added the PSEB chief.

Prime Minister Shaukat Aziz in August this year asked for steps to start the construction of long-awaited IT parks in Islamabad, Lahore and Karachi, indicating the IT-enabled office space was a critical requirement for the development of the industry.

The August meeting resulted in recent visit of the information technology ministry high-ups to Malaysia, one of the fastest growing IT industries across the world. The authorities believe planned cooperation may prove fruitful for both countries.

“To jointly explore, wherever feasible, cooperative projects that can be accomplished through employing ICT (information and communication technology) between MDeC and PSEB, or between third parties identified by MDeC and PSEB, in the areas of ICT industries and multimedia or other areas as may be agreed upon by the parties, including but not limited to:

(i) the development of IT parks (ii) ICT in the logistics sector or e-logistics; and (iii) market entry facilitation for companies from both countries.” The accord between the two organisations also allowed exchange of information and sharing of ideas, wherever relevant, about strategies and best practices in nurturing the local IT industry and multimedia companies.

The country’s software exports have been on the rise for the last couple of years, crossing $70 million during 2005-06 for the first time, registering a growth of 50 per cent, as western firms started turning more and more towards Pakistan for IT-enabled services to cut costs and raise profits.

The IT industry emerged as the fastest growing sector in the last fiscal, mainly supported by phenomenal jump in call centre operations during the last two years.

More than 140 centres are currently operational, mainly in Lahore, Karachi and Islamabad offering employment to around 5,000 people. Plans to build IT parks in major cities, IT players say, may further accelerate the industry’s growth. “For this year (2006-07), we have set $108 million software export target,” said Hussain, MD PSEB. “The target is inspired by the State Bank data, which showed our companies managed to export over $72 million worth of software during 2005-06 and with the same rate we should achieve the new target by the end of June 2007.”