Telecoms, internet in Pakistan

TMCnet

Telenor Pakistan (Pvt) Ltd. has awarded a contract to Huawei Technologies to build a nationwide all-IP based Dense Wavelength Division Multiplexing (DWDM) network.

According to Peter Anthony Dindial, chief technical officer of Telenor Pakistan, the company is pleased to continue its business relationship with Huawei by adopting its DWDM technology.

Dindial said that the selection of the right product is crucial for a rapidly growing operator such as Telenor Pakistan in a competitive market. Telenor Pakistan has therefore selected a solution that meets the requirements for their rapid growth and smooth business development and ensures a continued evolution of their network.

“We are honored to be selected by Telenor Pakistan to build its nationwide DWDM network after we have successfully passed its rigid test and we believe this is a win-win situation,” said Ding Shaohua, senior vice president of Huawei in a press release.

Shaohua said that this contract reaffirms Huawei’s position as the world-leading transport network supplier and believes the successful collaboration of the two companies will be providing the world-class technologies and state-of-the-art services to the consumers of Pakistan.

Huawei has also partnered with other global tier-one telecom operators including British Telecom, KPN and Telecom Italia to provide its future-oriented and innovative bearer network solutions.

Huawei made news last month for entering a partnership with CounterPath Solutions , Inc., a provider of VoIP (Voice over IP) and Video over IP SIP (Session Initiation Protocol) softphones to provide enriched services for global telecom network operators based on the IP Multimedia Subsystem (IMS).

Telenor Pakistan is a wholly-owned subsidiary of Telenor ASA. Telenor Pakistan launched its GSM/GPRS services in March 2005 and has become the 2nd largest cellular network by reaching more than 1100 destinations with over 7 million subscribers in Pakistan.

Huawei Technologies provides next generation telecommunications networks. The company is committed to providing innovative and customized products, services and solutions to create long-term value and potential growth for its customers.

As MNP is set to launch in Pakistan any month now here is an interesting Economist article about what happened in Japan. Summary: prices didn’t go down but customers got more and better services.

This is quite interesting because Paktel is the first International company bought by China Mobile, the world’s biggest wireless carrier by market capitalisation.

other links:
Xinhua
Financial Express, India
Light Reading
Reuters

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China Mobile takes control of Paktel

The News, KARACHI: China Mobile is set to enter into Pakistan’s cellular industry, as the Asian telecom giant has reached a $284 million deal with the Luxembourg-based Millicom International to acquire its operations in Pakistan Paktel, one of the six cellular operators in the country.

Sources in telecom said the Millicom International, which operated both AMPS and GSM cellular services through Paktel in Pakistan had formally announced the deal to finally wrap up its more than 15-year operations in the country.

“Millicom International has signed an agreement for the sale of 88.86 per cent shareholding, in Paktel Ltd to China Mobile Communications Corporation,” said a Millicom International statement.

“The transaction implies an enterprise valuation for Paktel Ltd of $460 million. The total cash consideration payable to Millicom as a result of the transaction (including the repayment of inter-company debt) is approximately $284 million.”

It said the completion of the transaction is subject to certain regulatory approvals and procedures and if such requirements were met, conclusion of the deal was expected to occur in late February 2007.

“Now the two parties would formally approach the telecom authorities in Pakistan to get a nod over the deal,” said a source close to the Millicom’s operations in Pakistan. The Millicom authorities in November 2005 announced that they were discussing the sale of one of its Pakistani units.

The same month Millicom, reported earnings before tax, depreciation and amortisation of $110.8 million, below the $117.6 million of the same period of 2004 and its shares were 3.09 per cent higher at 150 crowns after the figures.

In January 2006, Millicom International said following high number of unsolicited approaches its board of directors decided to conduct a review of strategic options for the company and appointed Morgan Stanley as financial adviser.

“With the sale of Paktel, Millicom telecom operation in Pakistan started in 1990 has become a history as it has already sold out its shares in Instaphone to local partners,” said the source. He said China Mobile was very much interested in Pakistani cellular market and also attempted to get a GSM licence in an open auction in 2003,” he added.

With more than 250 million wireless customer accounts as of last month, China Mobile is by far the world’s biggest wireless carrier and controls about two-thirds of the mobile market in China. “The move may trigger new kind of competition in the merging telecom markets including, Pakistan,” said the source.

“China Mobile has built one of the most extensive national cellular networks in the world, covering all of mainland China and the company’s strategy clearly shows that its target market is Asia and other emerging telecom markets.”

He said though Millicom’s Pakistan operations was not in a very attractive position, still the country offered one of the best business opportunities to telecom operators, as its most of the rural areas were without basic telecom facilities.

“By December 2006, Paktel enjoyed 1.3 million, which ranked the company at fifth in terms of market share among six cellular operators with total 48.50 million cell phone users across the country,” added the source. He said for China Mobile, Pakistan was among emerging markets, which represented a particularly attractive destination for telecom companies as western markets become saturated.

“In many developing nations, including the fixed-line infrastructure is poor and limited in its range, so cellular networks, which are cheaper to roll out than traditional lines, are used as the primary means of communication,” added the source.

Cellular companies join hands against WLL operators

KARACHI: Major cellular companies have joined hands against wireless local loop (WLL) operators and approached the telecom regulator to penalise one of the companies, just days after the authorities’ findings that most of the service providers are not following the determination on limited mobility.

Telecom sources said Paktel, Telenor, Warid and Mobilink had signed and sent a formal complaint letter to the Pakistan Telecommunication Authority pointing out the violations of regulated policies by the WLL operators.

“The complaint, in fact, defines overall violation by the WLL operators for effectively providing cellular services, which amounts to clear violation of the determination on implementation of limited mobility issued by the PTA,” said a source citing the complaint text.

“Mobile phone operators have raised their concerns recently and expressed doubts on the intentions of the WLL operators, who opted for limited mobility.”

He said the cellular service providers were of the view such violations by the WLL operators could lead to serious damages to the companies investing billions of dollars in infrastructure development.

“The cellular companies are the only parties licensed to provide mobile telecom services in the whole of Pakistan, and have collectively invested billions of dollars in this behalf,” he said.

Fresh complaint lodged by the cellular companies has come up as second serious signals of violations in less than a month, as the PTA couple of weeks ago raised the same concerns in its quality survey report conducted for the WLL operators across the country.

“It was also observed in the survey that WLL operators are not strictly following the determination on limited mobility,” the PTA said in a statement issued after the survey report.

“Therefore, they have been asked to take immediate action to implement the same and submit a compliance report to PTA by 15 December 2006,” said the watchdog. The cellular companies’ complaint appears to match the regulators’ findings.

“The cellular companies argue that WLL licenses are fixed line telecom licenses in which the service provider has to identify a subscriber with respect to a fixed address (either home or an office) allowing the subscriber to move about within a cell,” said the source.

“Therefore, mobility beyond a single cell will lead them into the domain of cellular mobile operations.”

In this regard, he said, the PTA carried out a detailed consultation with all the stakeholders and in July 2005 issued a determination that restricted the mobility in WLL system to a single Home-Cell.”

The government deregulated the telecom sector in 2003 in a move believed to enhance teledensity and to promote basic telephony mainly the in the rural parts of the country. The Telecom Policy 2003 prepared in line with this objective applied to opening up of the fixed line telecom facility.

The policy also known as fixed-line policy proposes two types of licenses, which includes local loop fixed-line and long distance and international (LDI) fixed-line. But since the start of WLL operations, they have been facing strong opposition from the cellular companies.

“It is important to keep in mind that the aim of the WLL was not to provide mobility to the customers, rather it was to provide fixed wireless access (FWA), which is an alternative to fixed line or Plain Old Telephone Service (POTS),” he said.

“If the mobility factor was more important for the Pakistani consumer, the government could have issued many more cellular mobile licenses to meet the market demand. But it was estimated that for a market like Pakistan, six cellular operators will be more than enough to achieve an adequately competitive environment.”

The government charged over Rs10 million for each license of WLL operations and it awarded some 84 licenses to 36 companies for fixed line local loop; fifteen companies have been given 90 licenses for WLL while 12 licenses were issued licenses for LDI.

The government however set $291 million as a GSM license fee and the six companies claim to have spent $3 billion collectively so far to build an infrastructure. By the end of November 2006 the six cellular companies enjoyed more than 46 million subscribers across the country compared to 1.42 million customers of WLL operators.

Cellphone subscribers cross 46mn

Published: Sunday, 24 December, 2006, 08:59 AM Doha Time

KARACHI: The number of cellular phone subscribers in Pakistan has crossed the 46mn mark and officials as well as operators see it touching 50mn within next couple of months for the first time ever on continued popularity of the service across the country.
The latest figures compiled by the Pakistan Telecommunication Authority (PTA) suggest cellular phone connections stood at 46.45m by November, which had crossed 41mn by the end of the first quarter of 2006-07.
“By November 30, total number of cellular subscribers stood at 46.45mn,” said a PTA official. “It reflects almost a 12% growth in total cellular subscriber base from October 1 to November 30.”
The official said during first five months, more than 12mn new connections were sold out on the back of comparatively cheaper tariff offers due to rising competition among the cellular service providers.
“So there was over 27% mobile density rate by November,” said the PTA official. “Almost all the four major companies Mobilink, Ufone, Warid and Telenor grabbed better market share during the first five months of 2006-07, which also brought different tariff packages for the subscribers.”
The figures gathered by the telecom watchdog, shows by November 2006 Mobilink led the market share with 22.03mn subscribers followed by Ufone, which was serving to 9.6mn people across the country.
With the arrival of UAE-based Warid Telecom and Norwegian Telenor both competition and subscriber base grew at much faster pace, as the last year’s entrants attracted 7.3mn and 5.8mn subscribers respectively by the end of November 2006.
The PTA data say by November Paktel services enjoyed 1.4mn subscribers and the only AMPS service Instaphone had a share of 0.25mn by November. – Internews

© Gulf Times Newspaper, 2006