Mobile cellular service policy: from dusk to dawn
The News,By Tayyaba Khan.

The cellular telephony sector is one of the fastest growing high-tech areas of our times. Right now in Pakistan the investment in this industry is around a billion dollars with more than 3 million subscribers. With the existing operators planning further investments to expand their infrastructure and subscriber base, it is safely assumed that by the end of the year 2004, the cellular subscriber base in number terms would leave fixed telephony line subscriber base way behind.

Recently, a draft of the Cellular Mobile Policy has been circulated amongst stakeholders and also placed for public comments. The stated objective of the policy is to streamline the cellular industry.

The ministry of information technology and telecommunication is hoping to finalise the policy by the end of January. The draft policy has many positive aspects, but leaves many ambiguities and also includes some clauses that can draw a string of reactions from the stakeholders. There are abundant loopholes in the policy. The policy, drafted by an independent private consultant, seems heavily tilted in favour of the new licenses that the government intends to issue in March this year. To facilitate new operators, the existing operators are being forced to share their infrastructure.

The policy seems to have drawn heavily from the telecom sector of the West without taking into consideration the local realities.

In the West there are independent companies that build and provide infrastructure for the telecom sector only and then those companies lend their infrastructure on a commercial basis to the telecom operators. But the local scenario is somewhat different from that in the West - in our country everything is to be done by the operators themselves.

It is quite unfathomable to ask the existing operators who have developed their sites, invested millions of dollars, taken pains to obtain NoCs from different government departments and agencies, to share the same jointly and collectively with the new entrants.

Clearly, sharing is tempting for the new entrants because it offers significant cost savings and little infrastructure expenditure. Since cellular telecommunication is a technologically advanced industry where staying ahead is the name of the game, this all seems a bit unfair.

Network sharing must not reduce the volume of infrastructure in the long term as technology giant Nokia pointed out in a white paper recently. This will be dictated by the demand for capacity. It is, therefore, important to plan for a future situation that will benefit all parties involved. Infrastructure sharing has its own environmental hazards, although shared sites reduce visual pollution they increase radio pollution. Therefore the existing set-up is safer than the suggested new one.

The policy further stipulates national roaming, which goes against the principle of fair-competition. It seeks to benefit the new operators with least investment. For example, under the disguise of level playing field to encourage competition, should Petroleum Regulatory Authority mandate Shell to sell the products of a new entrant in the petroleum business at all its outlets across the country? Logically, the proposed steps of the government do not encourage investment to build out and expand the cellular infrastructure in the country.

A few years ago the addition of Ufone as the fourth entrant in the industry was hailed as a good move. However, the decision of issuing two more licenses on the basis of the projected figure of 25 million potential subscribers by the year 2018 is debatable.

Even if the figures are accepted, one can always argue that in China where already the customer base is very large compared to Pakistan, there are only four operators who expand according to the dictates of the market.

The policy also makes a case for increased licenses and spectrum fees. No doubt that the existing operators are now profitable and the Exchequer should accordingly be adequately compensated. This can be utilised as an opportunity for the growth of the industry by cutting oppressive taxes and maximising sales volume. The Exchequer will automatically receive its due share out of increased profits of the cellular companies.

The draft policy expounds to provide a ‘level playing field’ to the new entrants, whereas the commitments made to the existing operators are not being honoured. Pakistan has suffered in the past because of the perception that the successive governments do not honour commitments; the HUBCO fiasco is still fresh in the minds of the investors. The incident had devastating consequences to the goodwill and credibility of Pakistan. To ensure that history does not repeat itself, such steps should not be taken by the authorities that would disrupt the smooth functioning of the private sector business operations.

The draft policy, as a whole, is riddled with highly controversial issues that need serious re-consideration as far as the existing operators and the foreign investors in general are concerned. This is definitely undesirable in a developing country like Pakistan.

There are many other issues touched upon in the draft that are of a highly technical nature. The major impact of these issues can be evaluated by the professionals of the cellular industry. They should all be given the chance to come forward and comment on this draft, as that would ensure the transparency of the policy being enforced. This would also ensure that no unfair deals are made to over facilitate the new companies.

To quote Franklin, "It is easier to suppress the first desire than to satisfy all that follows it."
- posted @ Monday, January 19, 2004

 
Co-location price reduction
"ISLAMABAD, January 18 (Online): Pakistan Telecommunication Authority (PTA) has asked PTCL to provide maximum relief to the telecom service providers, who use PTCL’s co-location facilities for the promotion of industry and providing quality service to the consumers.

The Authority took this decision in a meeting held on Saturday which was attended by representatives of mobile operators, Internet Service providers, pay phone operators and Pakistan Telecommunication Limited.

Under the new arrangements, rates for purpose built co-location space has been reduced from Rs 168/- per square feet to Rs 78 per month, rent for roof top dish antenna space from Rs 36 per SQF to Rs 16.50 per SQF per month.

PTCL has also been asked to approach WAPDA and KESC for seeking their consent to charge PTCL at the industrial tariffs instead of commercial for the benefit of the service providers.

It is pertinent to mention that the decision will prove a landmark in the expansion of telecom systems and services as the framework agreed by the parties will provide significant relief to the IT and Telecom service providers all over the country. "
- posted @ Monday, January 19, 2004

 
Telecom De-Regulation Policy Approved
Only one year afer the expiry of PTCLs monopoly the cabinet has finally approved the deregulation policy, 'formally'. The announcement would appear to clear the way for PTA to issue application forms for the new Local Loop and LDI licences. These licences were slated to be issued in December 2003.

"The Cabinet formally approved the Telecom De-Regulation Policy already agreed to in principle, by the Cabinet in July 2003 after fixing the validity of the license for Long Loop and Long Distance International Telecom Services at 20-years.

The Information Technology and Telecom Division will notify the approved policy which will be reviewed after every five-years.

The policy is designed to achieve the objectives of provision of telecom services at competitive and affordable rates, infrastructure development, increase in telelcom density and private sector investment in the telecommunications sector, with minimum exposure to government revenue base in the short term and enable the PTA to invite Expressions of interest from potential investors.

The World Bank has already termed this policy as a progressive telecommunication deregulation policy reflecting international best practices. "


- posted @ Monday, January 12, 2004

 
Fascom blocks N2P
Karachi: In a interesting development N2P and Yapjack users complain that Fascom no longer allows connection to Net2Phone services. Until now Fascom was the only ISP that could connect to N2P due to its connectivity and was providing 4 million minutes per month.
Industry insiders speculate that the new policy is designed to help sales and use of Call00, Fascoms voice origination system.
- posted @ Thursday, January 08, 2004

 
PTCL unblocks all telephony websites
Jang, KARACHI: Internet Service Providers (ISPs) have claimed that the Pakistan Telecommunications Company Limited (PTCL) has unblocked all Internet telephony websites.

Officials - pretending to be unaware of the situation - were however reluctant to confirm this news.

The ISPs claim that the PTCL has unblocked all 17 websites providing Internet telephony access to the browsers, a move which apparently came in the wake of an order of the Pakistan Telecommunications Authority (PTA) a year ago.

"We have been experiencing no problem in accessing and providing our customers Internet telephony access," said the head of a local ISP - having bandwidth from Pakistan Internet Exchange, a sister concern of the PTCL.

He claimed that the ISP had been providing Internet telephony services to its customers but added that the authorities had not informed about the development.

"We have neither been informed by the PTCL nor the PIE (about this development). Anyway, it is good for us," said the head of the ISP.

On the plea of the PTCL, the PTA - the national telecom regulator - in February 2002 put an end to Internet telephony by imposing a ban on all 17 websites, which facilitated worldwide calls by-passing the PTCL.

PTCL officials argue that under the Pakistan Telecommunication (Re-organisation) Act, 1996, basic telephone services were the prerogative of the phone utility.

The Act declares that "basic telephone services mean the provision of any telecommunications service, which consists of a two-way live voice telephone service in digital form or otherwise over any fixed switched network or between base stations or switches or modes of any public mobile switched network; real-time transmission or reception of facsimile images over a public fixed switched network; international telephony service; and the lease of circuits for the provisions of the services specified."

However, in November 2002, the PTA asked the PTCL to unblock all the Internet telephony websites.

"But they (PTCL) didn’t follow the PTA’s orders and the sites were blocked till a few days ago," said the head of another ISP.

"However, it is good for both ISPs and Internet browsers. It is better late than never," he commented.

He said Internet telephony had nothing to harm the PTCL’s business. PTCL business, the head of the ISP said, did not increase due to a ban on Internet telephony but due to a cut in its tariff, twice in a year.

In October 2003, the PTCL cut overseas call rates by 23 per cent per minute. However, the per minute call rates for Australia, Brazil, Brunei, Canada, France, Germany, Iraq, Japan, Libya, Norway, Russia, Saudi Arabia, Sri Lanka, Syria, Tajikistan, Turkey, United Arab Emirates, United Kingdom and United States of America were fixed at Rs30 from the previous Rs39 per minute.

The PTCL however says that unblocking of Internet telephony websites is not decided.

"It is not officially decided. We would see how it has happened," a senior PTCL official said wishing not to be named. He suspected it might be some technical problems, ultimately resulting in unblocking of Internet telephony websites.
- posted @ Thursday, January 08, 2004

 
Termination Terminated
A press release issued by the Pakistan Telecommunication Company says that a team comprising PTA regional director Rizwan Hyderi and officials of the National Security and Surveillance team of the PTCL and a police squad of the Saddar police headed by ASP Kashif Kanjoo carried out a raid on an illegal gateway exchange terminating illegal international calls bypassing the gateway exchange of the PTCL at room No 1513, 15th floor, Scissor [Sic., they mean Caesers Tower - the 15th floor houses the National IT Park], Tower, on Sharea Faisal, and arrested Nadeem Saleem on Monday.

Official story on the link above
- posted @ Tuesday, January 06, 2004

 
Ufone upgrades
Pakistan's Pak Telecom Mobile Limited (PTML) has awarded Nortel Networks a contract estimated at US$56 million to implement a major expansion of PTML’s national Ufone GSM900 network. This is the second major expansion by Nortel Networks since building the original network for PTML in 2001, and it is expected to raise Ufone’s capacity to 1.3 million subscribers.

Full story via the above link.
- posted @ Monday, January 05, 2004

 
Call centres register sharp growth
Call centres in the country have registered a sharp growth, in the last six months, reaching 22 from 3 due to rising demand of IT-enabled services.
- posted @ Saturday, January 03, 2004

 
Appointment of two top PTA members challenged
The appointment of 2 employees of PTCL has been challenged in the Lahore High Court. The appointment of the 2 PTCL employees not only reduces the already low credibility of the Telecoms regulator but is obviously illegal.
- posted @ Thursday, January 01, 2004