The 3G License Auctions to be held on March 29, 2012 of which the PTA Chairman have given assurance recently could get postponed. Earlier it was just the EOIs of consultant due date (March 26)  indicating on this, but now we also have the official announcement of pre-bid meeting due on March 5 postponed to a later date.

This being done to facilitate interest shown by operators at the Mobile Word Congress held at Barcelona. The new date is yet to be announced. Official announcement on PTA’s website says:

Due to the great interest shown by operators through their representatives in World Mobile Congress being held in Barcelona, Spain, the Pre-bid meeting which was earlier to be held on March 5th, 2012 has been postponed to allow more time to the operators to evaluate the emerging situation and allow them more room to plan. The new date shall be announced shortly.

Amid resistance, questions on transparency, confusions and other views; PTA’s Chairman Dr. Yaseen in his recent interview have yet again expressed that 3G Spectrum Auction in Pakistan will take place next month.

The brief of Dr. Yaseen’s interview as reported by Mobile Business Briefing can be read below. Some key points have been underlined.

Pakistan is to hold 3G auctions next month and is aiming to attract 15 million mobile broadband users within the first year, the country’s regulator has told Mobile World Daily in an exclusive interview.

Dr Mohammad Yaseen, chairman of the Pakistan Telecommunication Authority (PTA), said that three blocks of spectrum in the 1900/2100MHz band and another at 800MHz are to be sold off, with licences expected to be awarded to at least three operators. Both new and existing market players are invited to bid and Yaseen said the country’s regulatory framework was geared up to facilitate foreign investment.

Bids will start at US$210 million for the 1900/2100MHz spectrum and US$155 million for the 800MHz licence. In the first rollout phase, existing operators will need to launch services in four Provincial Capitals and the Federal Capital within six months after being allocated, while new players will be given a year.

Pakistan is the world’s tenth largest mobile market with around 113 mobile subscribers at year-end 2011 – but has a market penetration of just 66.5 percent.

“Keeping in view the situation for fixed line broadband in the country [under 1 percent], we expect that during first year of its introduction 3G mobile broadband services will attract approximately 15 million subscribers with a steady growth afterwards,” said Dr Yaseen. He added that the Pakistan government was looking at the mobile sector as a “major contributor” to the country’s economy. “The telecom sector contributes about 1.5 percent in the national GDP on annual basis [and] is providing direct and indirect employment opportunities to more than 1.5 million individuals. [The] government is putting all emphasis on cellular broadband proliferation for further economic growth.”

Dr Yaseen said that 3G will enable value-added services such as health, education, money and entertainment. “The majority of the population consists youth who are eager and excited to enjoy mobile entertainment and Internet service on the move,” he said.

It is worthy to note here PTA has recently sought for EOIs from consultancy firm of international repute to offer services for the auction of 3G license which is due for submission on March 26, that is three-days before the Spectrum Auction date. Also some recommendations of the Standing Comittee on IT are yet to be considered.

via MBB

Guest Post by Parvez Iftikhar

AS A CONCERNED CITIZEN, I WOULD LIKE TO URGE ALL THOSE WHO HAVE ANYTHING TO DO WITH THE ICT SECTOR TO DO WHATEVER THEY CAN, TO PUSH AND EXPEDITE INTRODUCTION OF MOBILE BROADBAND (3G OR WHATEVER).  I say this because yet another delay (albeit short and for good reasons) has appeared.

Irrespective of the on-going, completely unnecessary, “controversy” surrounding auction of 3G in Pakistan, allotting 3G frequencies to telecom operators is extremely urgent and essential for Pakistan. We have already been left behind by others who used to be our followers in 2G. Mobile broadband – or 3G – should have been introduced here already four years ago. The delay has made us lose huge opportunities relating to job creation, international trade, economic growth and Foreign Direct Investment (Telecom FDI 2007: US$1,824 mil and 2011: US$ 79 mil). Not to mention letting the technology gap between the advanced countries and us widen even more, despite the fact that more than 70% of our population is below 35 – normally considered early adopters of modern technology.

According to ITU’s World Telecommunication/ICT Indicators Database, a total of 159 economies worldwide have launched 3G services commercially and the number of active mobile-broadband subscriptions has surpassed one billion.  Countries from New Zealand to USA are allocating huge amounts of national resources to deploy infrastructure, like Optic Fiber Cables, to facilitate delivery of broadband to the citizens. Whereas we are taking ages even to allocate the God-given resource of frequency-spectrum which will facilitate provision of broadband.

Some skeptics ask what we will do with 3G? Mostly they are only thinking in terms of mobile phones – and not mobile broadband. Although a lot could be done with 3G smart phones too (present estimate 15 mil smart phones in Pakistan, expected to increase to 50 mil by 2016), it is 3G mobile broadband, mainly using USB dongles, complementing fixed broadband, that is of bigger value and main attraction for countries like ours. While people in developed countries usually use mobile-broadband in addition to the fixed, mobile-broadband is often the only access method available to people in developing countries.

Broadband has tremendous commercial usages but one of it’s main benefits lies in it’s capability as a deliverer of basic services to hundreds of millions of citizens, especially those living in the hinterlands of the country. Education, Health, Governance, Commerce, Agriculture, Women Empowerment,… all can find their way. Greater access to broadband services has been found to help accelerate achievement of development targets like the internationally-agreed Millennium Development Goals. It is only using broadband that we can serve our exploding population (CAGR: 2.5%) at their doorsteps, not only to bring prosperity to them but also prevent mass migration to urban centers and save our bursting mega-cities from crumbling under their own weight.

Right now in Pakistan broadband is available in less than 300, small and big, towns and cities. All the present two million connections being of fixed broadband category (50% wireless). But then there is only so much fixed technologies can do. Fortunately, thanks to the ubiquitous 2G GSM network, 3G can take broadband to every nook and corner of the country, becoming accessible to more than 90% population, with relatively small effort. I have deliberately used the word “effort” and not investment because investment will come from private sector telecom operators. Here is a sector where the government doesn’t need to bother about development budget allocations and resource constraints. Just like 2G was such an effective engine of growth for our economy, 3G too could contribute significantly. Admittedly the private sector operators would like to invest and deploy 3G mainly in large cities, but for the rest there is USF!

As for the controversy, firstly, on a per-megahertz-per-year basis, the announced base price is equal to the peak price achieved last time around. Secondly it is likely to go higher during bidding, despite worse political/economic/security situation than in 2004. And thirdly the licenses are going to be technology-neutral, therefore it is the operators who would decide whether they deploy 3G or something else (incidentally 4G – the so-called LTE Advanced — is not even there yet). Yes, the only thing that all of us need to be vigilant about and jealously guard is the process being followed. The process must be fair and transparent. Period.

The author is the formar CEO of USF (Universal Service Fund) Pakistan. He joined the newly formed USF in May 2007 as it’s first employee. Within weeks he built the organisation and successfully started executing projects to bridge the digital divide in the country thru private sector telecom service providers. USF Pakistan is globally recognized as a success-story in it’s domain. Parvez receives frequent invitations to deliver talks at international forums on Universal Service Obligation issues (mainly sponsored by World Bank, ITU and USAID) as well as conduct workshops and provide consultancy services to various countries. Presently Parvez is working as an Independent Telecom Consultant. Before USF he was the country-head of Siemens Telecom in Pakistan. Has been to great learning institutions like Carnegie Mellon and Oxford Universities and has been extensively trained by Siemens in Germany.

This post first appeared on Parvez Iftikhar’s personal blog.

We have discussed all things 3G manier times earlier. But as the Spectrum License auctions draws near we have some opposing elements to raise confusions over the matter. Recently the Senate Standing Comittee on IT have asked PTA to incorporte some of their recommendations in the in the 3G Policy.

The recommendations put forward are:

1. Auction one technology license i.e. 3G licenses only. The terms 4G/LTE and technology neutral should not be used
2. 4G/LTE should be licensed later
3. Increase the base price – US $ 210m to US $ 291m
4. Defaulters not be allowed to participate

Before we discuss on these recommendations it is worthy to note that these come in after the policy have been approved following a long process chain during last few years. It had gone from the MoITT to Federal Cabines, revised and only then approved by the PM before finally passing it on to PTA for implementation and calling in for the License Auctions.

Now as the investors have geared up for the show and the investment oppurtunities are all set to come in, the Senate Comittee have its reservations. Late, isn’t it?

Coming back to the recommendations, we shall try to make it easy for all to understand.

Number 1. It should be clear for all that it is not the technology being auctioned. The auction have clearly been called in for wireless specturm of 10Mhz band. Succesful bidders can opt to introduce any technology (3G/4G/LTE) they can in this spectrum band. Did we have license auctions for GPRS or for a fact for EDGE services introduction? No, because they were offered in the same spectrum being used for 2G. If I am not wrong, we also did not have a separate auction for WiMax services. Thus, arguing on calling it a 3G only license is baseless.

Number 2. As explained above this is technically not possible and is also against globally accepted norms. If its about a democratic revenge, it can only be made possible politically.

Number 3. We have discussed it technically in our earlier post. Putting it again; the standard and fair measure to compute the base price is ‘per-megaherts-per-year‘ and 3G being auctioned as a 10Mhz band license and not 13.xMhz band (2G), the base price comes to the same. Simple maths!

Number 4. Considering the dues PTCL owes to the government of Pakistan that are being delayed time and again, we find this as the only reasonable recommendation.

In Pakistan, it’s already late for upgradation of any spectrum dependant wireless technology. We now must not leave confusions in the air and try to push it backwards. For all the bright side ProPakistani has highlighted in its post on the same subject, let us act sensible and voice our opinion at all platforms to let these opposing elements know that we have every rights for better communication services for ourselves.

As the upcoming license auctions draw close, news flows in that global telecom giants are cosnidering to participate in the bidding process. Prospective bidders to enter the Pakistan telecom market were informed to 3G/4G/LTE advisory committee.

As reported by Dawn News, they include:

• AT&T of USA
• British Vodafone
• Japan’s DoComo
• Qtel of Qatar
• Roshan Telecom from Afghanistan

The report further streghtens Warid’s un-fit financial position for the bid. Also, Warid can possibly make a joint bid with some telecom firm from Malaysia. Qubee is also reported to be in talks with current market players for a joint bid.

Complete report from Dawn News follows:

At least nine telecommunication companies including four world majors are likely to participate in bidding due by end-March for third and fourth generation telecom licences in Pakistan, raising hopes for a better foreign exchange yield.

An advisory committee on 3G/4G/LTE led by prime minister’s adviser on finance Abdul Hafeez Shaikh was informed on Thursday that British Vodafone, Japan’s DoComo, AT&T of United States, QTel of Qatar and even Roshan Telecom of Afghanistan were preparing for bidding to be new foreign entrants in the country’s fast growing telecom industry.

The information, based on market intelligence, was put forward by Ministry of Telecommunication and Pakistan
Telecommunication Authority (PTA).

The advisory committee was also informed that among the existing players Ufone, Mobilink and Zong were keen to get the new licences to be available for 15 years. Another player Warid was not in a position to independently vie for the future licence due to financial constraints but was in contact with a leading Malaysian telecom firm for a joint bid, according to market intelligence.

Qbee another firm that currently operates wireless and internet services in Pakistan and Bangladesh was also reported to be making contacts with some market players for a joint bid.

The advisory committee, said these sources, discussed a proposal to appoint consultant or a consortium of consultants to assist the government in transaction structure and bidding process but was informed that this could delay the transaction in view of procurement rules while the government was interested in over $800 million sale proceeds during the current financial year.

The finance ministry was of the view that the government could exercise its right to bypass procurement rules to reduce time for the appointment of consultants because that would help the government to maximise sale proceeds. The committee members remained divided over the issue, Dr Abdul Hafeez Shaikh said the decision would be made in a couple of days after consultations with the ministry of law.

In the meanwhile, the PTA was directed to enhance its coordination with the major telecom players for wider participation in the bidding process. The committee decided to appoint a media consultant for the transaction. The committee also considered replies to objections raised by cross-party members of the senate over the base price fixed by the PTA for the bidding. It also decided to issue an international advertisement for competitive bidding.

The government plans to auction three 3G and one cellular licence for 1900/2100 MHz (3G/4G/LTE) band and 800 MHz Band. The base price for 3G licence to be effective for 15 years has been set at $210 million while the base price for cellular licence for 8 years has been set at $155 million.

Likewise, the earnest money to qualify for the bidding has been set at $31.5 million for each bidder of 3G and $23.25 million for cellular license. The spectrum capacity allocation has already been fixed for three 3G licences.

The bidders would be required to start their offers from the base price fixed by government with each increment of at least $2 million multiples. The successful bidder would be required to deposit 50 per cent of the auction price within 30 days of the auction and remaining 50 per cent in five equal instalments. The bidder would be allowed to launch its operations on 100 per cent payment of bid money.

The senators had objected to the bid price saying it was too low given the fact that cellular companies had paid $291 million per license in 2004 for 2G services (GSM), now considered an obsolete technology. The advisory committee was, however, told that base price did not mean a sale price that would go up on competitive bidding and reminded the senators that the base price for 2G licenses was set at $61 million that had increased to $291 through bidding.

The meeting was informed that base price for cellular licence was set at $155 million because it was being issued against the remaining 8 years period of the defunct Instaphone instead of other cellular licenses that were for 15 years. Even the bidding result for one GSM license would also go up.

The committee was informed that base price was arrived at after taking into consideration the 2004 auction result of 2G (GSM), expected service revenues, subscriber growth, economic growth, per capita income, political situation and population of the country.

via Dawn News

A look back at the people who made Pakistan less than proud in 2011.

Newsline looks back at the biggest events of 2011 and gives them a satirical spin.

In a recent media breif by Mobilink, Rashid Khan, President and CEO said that his company “is evaluating the information memorandum of 3G spectrum and has decided to participate in the bidding”. With this announcement Pakistan’s largest cellular networks comes forward as the first potential bidder for the 3G auction scheduled for March 29, 2012.

Going further, Khan said that despite the global economic recession there was an enabling environment for cellular business in Pakistan. This comes as a very expected statement from a mobile operator in market where the ARPU is near USD 3.

It must also be noted over here that, as advertised by PTA in local newspapers earlier this week, the base price of 3G license is USD 210 million with USD 31.5 million. The auction will be conducted through multiple rounds and open outcry method while each operator can secure 2 block of spectrum.

Commenting on the base price, Rashid Khan said it was a reasonable base price determined on the basis of telecom policy. He also ruled out that the five telecom sector companies were colluding for the bid.

On the other hand, Senator Pervez Rasheed of PML(N) has questioned on the transparency of 3G auction in the senate session that the base price of 3G license of $210 million is much lower than the base price at the time of 2G license which was $290 million. He demanded to immediately stop this process and review its conditions to avoid any chances of embezzlement.

Senator Pervez was supported by Haji Adeel, Ilyas Bilour of ANP, Col. Syed Tahir Hussain Mashhadi (retd) of MQM, Prof. Khurshid of JI and others warning the government not to proceed with its auction plan without taking them into confidence. They also had reservation on the license being auctioned on “technology neutral” saying that this would be like a charity.

via Express Tribune and Business Recroder

The earlier version of the post had  a typo error in the base price of 3G license, the same has now been corrected.

PTA has published the information memorandum for 2012 auctions for both the Defunct Specturm and 3G/4G/LTE spectrum licenses. They can be downloaded from links below:

• Information Memorandum 2012 Mobile Cellular License/Spectrum Auction (3G/4G/LTE etc.)
• Information Memorandum 2012 Mobile Cellular License (Defunct)

Soruce: PTA

Finally after having a long wait we get particular date for 3G Auction in Pakistan. In recent press release Dr. Muhammad Yasin, Chairman Pakistan Telecommunication Authority described that Pakistan is going to auction third generation telecommunications licenses on March 29th, 2012 and every licenses will be generally be starting at valued from USD 210 million as well as will be sold by way of highest bid taker.

Exposing original information about the 3G license auction, Mr. Yasin declared that the total amount bidders will need to deposit with preliminary expressions of interest – to point out the importance of a bid – might possibly be $31.5 million and license terms and conditions could be from 8 to 15 years. Chairman PTA is expecting to catch the attention of a minimum of 10 to 15 potential buyers pertaining to very first bidding procedure. With the objective, PTA is actually in the process of investors’ conferences within Islamabad and also Karachi. We all know How 3G Technology Changed the World Dr. Yasin, additionally describing the auction methods, mentioned that current telecom providers could quite possibly get started providing 3G services soon after being granted a license, before the new operators start it, they’re going to have to wait right up until March 2013 to begin 3G services in the Pakistan.

He was quoted saying that there might be possibly that no minimum and maximum specifications for international equity and international operated organizations and it could be permitted domestic financing.

Giving an answer to a question he declared that prices are minimal more than that they had initially anticipated. Previously estimations recommended that the starting price for 3G licenses might possibly be $195 million, .

According to Experts the successful bid should not rise above $270 tag, although our current telecom participants who may have intends to not to choose 3G will have their finest to improve the bid worth; in serious situation $300 million level may perhaps be entered.

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The license for the 3G spectrum is announced to be held on March 29, 2012 reports Reuters. On the same subject PTA today conducted an Investors Conference in Islamabad attended by the Chairman PTA, Secretary Cabinet Division and Finance Minister.The tentative auction schedule and brochure have been uploaded on PTA website. You can also check them here:

• Auction Schedule
• Auction Brochure

Pakistan will hold an auction for its first licenses for third-generation (3G) mobile telecom services on March 29, an official at the country’s telecoms authority said on Tuesday.

Pakistan Telecommunication Authority (PTA) Chairman Mohammed Yaseen said the base price for the auction would be $210 million.

“We’re expecting 10 to 15 potential investors in the initial bidding process,” Yaseen told Reuters.

He said the amount bidders would deposit with initial expressions of interest — to indicate the seriousness of a bid — would be $31.5 million and licence terms would be from eight to 15 years.

Pakistan had more than 111 million mobile phone users in October 2011, according to the PTA, equivalent to around 65 percent of all Pakistanis.

Pakistan’s existing operators include Mobilink, a unit of Egypt-based Orascom Telecom, Norway’s Telenor , Warid Telecom, a joint venture between Abu Dhabi Group and SingTel Group, China Mobile Communication Cooperation’s Zong, and Ufone, owned by the Emirates Telecommunication Corporation Group, Etisalat, according to the PTA website.

Yaseen said existing licence operators could start offering 3G services immediately after being awarded a licence, while new operators would be able to provide 3G services from March 2013.

Update:

According to the tentative auction schedule, some important dates for the 3G auction are:

March 2, 2012 – Pre-Bid Conference in Islamabad

March 9, 2012 – End Date for Submission of EOI along with Application

March 12, 2012 – Qualification of Bidder Before Auction

March 22, 2012 – Receipt of Earnest Money in PTA’s Bank Account

March 29, 2012 – 3G Spectrum Auction

Picture Courtesy: Parvez Iftikhar

The Strategy and Development Division at PTA has recently published report on Pakistan SMS traffic in 2010. As per the report, a total of 175.4 billion SMS were generated in Pakistan during the year 2010 which is 15.66% more than in Y2009. The revenues estimated from SMS in the year 2010 is Rs. 22.5 billion.

Summary table with indivisual operator’s status is as follows:

The report also provide details on SMS cost analysis, SMS per month stats, Intercellular network utilization stats, Stats on on-net and international SMS.

Futhermore, the report proposes the following recommendations:

1. Info160 service must be focused for our market.
2. A2P &P2A must flourish in order to increase the revenues from SMS.
3. A2P & P2A SMS must be counted and maintained separately from P2P SMSs.
4. Location Based services must be introduced ASAP.
5. SMS delivery reliability must be enhanced in order to provide more VAS over SMS.
6. International SMS traffic must be enhanced through some attractive packages.
7. Cellular Operators should plan to provide detailed SMS-Data for Y2011 to ‘SMS analysis and Report’ team by February 2012 , so that the Y2012 Report may be out by June 2012.

Detailed report can be downloaded and read on the PTA website.