State of Telecom Industry in Pakistan

With some luck the Pakistani Internet user base may get a long overdue and much deserved break. That is, if the recent bandwidth rate cuts proposed by PTA are implemented and that’s where the battle is. Here’s a bit of history of the PTA vs. PTCL bandwidth rates controversy.

In an effort to accelerate the spread of broadband services in Pakistan, PTA cut bandwidth rates significantly in June and asked PTCL to apply the new tariff rates. This decision was based on a policy paper (PDF) by PTA in April – which concluded that lack of competition and high international bandwidth rates are harming consumers and businesses. The drastic reduction in bandwidth rates created a chain of events. Instead of complying with the PTA decision, the Etisalat-run PTCL took the legal course. In August, the Lahore High Court reversed the PTA decision on reduced bandwidth rates.

The chart below (taken from PTA paper referred above) shows the comparison of domestic leased circuit tariffs between India and Pakistan.

As reported by the Pakcdma site:

Based on the LHC verdict, the PTA has called the LDIs, ISPs, software companies’ representatives and PTCL for a review meeting on its determination. In its August 7 decision, the LHC gave the regulator 60 days to reach a fresh plan of bandwidth rate cut, which has been long over due for the Pakistani market.

The PTA was also directed to adopt the proper procedure for price determination by asking parties to submit and exchange their respective cases; holding a formal hearing; and issue fresh determination this time avoiding the pitfalls.

Read the PTCL response here. PTCL argued that the tariffs should be based on cost criteria.

Whatever the results may be, at least there is a process and some progress. Let’s hope for the best! Read more »

As the competition among the mobile providers heats up in Pakistan, they are coming up with new packages to attract and retain customers. Mobilink has introduced an interesting package called ”Ladies First” to attract the female market segment.

Currently Mobilink is number one mobile operator in Pakistan with over 19 million subscribers (49% market share). As reported in press here:

The service is targeted at ‘homemakers’ and ‘housewives,’ and offers bundled value-added services, including ‘beauty tips, cooking recipes, health notes, home, food and entertainment’, all via SMS. There are also special discounted call rates between 3pm and 6pm, designed to ‘help her to stay connected with friends and family’. It will, says Mobilink, ‘fully empower and equip the women in Pakistan with the tools needed to lead a successful and fulfilling life’.

It will be interesting to see how ladies react to this new offer and whether other providers jump in to create similar competitive offerings. Can you guess what’s so special about 3pm-6pm that Mobilink is offering a discount?

Quick summary of the Jazz Ladies First package:
• Beauty tips, mouth watering recipes, healthy diets and so much more all can be suscribed via SMS for a monthly fee (~ Rs.30/month for each topic)
• Special discounted call rates between 3pm – 6pm
• Lower outgoing call rates 2nd minute onwards
• Jazz Ladies First shopping discount card provides discounts with selected vendors

For details of the Jazz Ladies First package visit the Mobilink site.

Is Skype a good option for making calls worldwide?

Skype - the immensely popular Internet phone product - has 50 million users worldwide though I don’t have an idea of its users base in Pakistan. It uses a proprietary technology which leverages every user’s PC resources to route calls. One of the most impressive thing about Skype is how it manages to work through all sorts of network security features which usually block similar services.

Here’s an illustration of how Skype works (Courtsey:Business Week). Here is Skype’s official explanation.

In this post I’ll try to assess if skype is a worthwhile tool to have. For starters Skype is free so all you need is a PC and Internet. PC to PC voice and video communication is free with Skype and with many others (Google, Yahoo, MSN). The real question is about making calls from PC to phone numbers. Calls from Skype to US and Canada are free till 2006 end.

According to WiredPakistan users and other feedback, dialup works reasonably well with Skype for some users and broadband speeds of 128 Kbps or more definitely work quite well. Skype is a good communication tool for broadband users but it is worth trying by dialup users as well. Use it before it starts charging for calls or gets blocked!

Here are some helpful tips if your connection is not that fast:
–Users on dialup or narrowband should avoid multi-tasking.
–Use a decent PC .. Skype needs at least
* 400 MHz processor; 128 MB RAM; 15 MB free hard disk space
* Sound Card, speakers and microphone

With the recent broadband deregulation, many new technologies and companies have started providing broadband services in Pakistan. The pricing, availability and service quality varies by geographic location. The results of annual Internet Service Provider Quality of Service survey by PTA is a good starting point, though it includes dialup service as well as broadband.

Below I provide a short summary of providers by technology. Comparing prices and plans is still a mind boggling task!

• DSL: A technology based on copper lines i.e using plain old phone service and a special modem – works only if you are within a couple of miles of the phone exchange.
o PTCL list of broadband providers
o A few players: Micronet, Dancom, Habib Rafiq International, Cybernet World Online, WOL, Paknet, Maxcom
o Sample Rates: Micronet – Islamabad – 256 Kbps for home for Rs 1000.

• Wireless / CDMA: Offers Internet access using CDMA tecnology – it is fixed or limited mobility network. See more here.
The dominant players are: WorldCall, DV Com, Telecard, Diallog.

• Wimax: Coming in 2007 (Warid, WorldCall). See my post for details.

• ISDN: By PTCL. Not conisdered consumer friendly in terms of application process and reliability. Details at http://www.ptcl.com.pk/isdn_bri.html

• Cable: Limited urban infrasturcture availability.

These days its hard to read the news without finding a new mega deal between a Pakistan telecom provider and foreign company be it a handset maker, equipment maker or another service provider. The reasons for such deals and contracts are manifold.. comapnies do it: to differentiate themselves, to introduce new technology which can attract customers and revenue, to rapidly execute on objectives and to get the expertise which is not available within Pakistan. Expect this trend to continue as the market gets competitive and the price wars rage on.

A few examples of such telecom deals and partnerships include:

• Warid and Motorola on Wimax
• PTCL and Huawei & ZTE for V-Wireless
• Worlcall and Samsung / ZTE

One of the recent news is that of cooperation between Warid and Ericsson, a 274 Million dollar deal. The news article mentions:

Under the agreement, Ericsson will provide capacity for an additional 10 million subscribers through its mobile softswitch solution and the expansion of the radio access network in existing and new cities.

The expansion of the network and the implementation of Ericsson’s leading Mobile Softswitch solution will enable Warid to cater for Pakistan’s increased capacity requirements, cover its growing customer requirements effectively and smoothly evolve to all-IP.

One may ask if the delicate Pakistan economy is likely to sustain the demand for capacity. In the US many telecom comapnies rushed to lay fiber in the 1990s and after the bubble burst they were left with redundant infrastructure. Surprisingly the US consumers have not rushed towards broadband as people in other countries. Hopefully the case in Pakistan will be different. It is my opinion that Pakistan is waiting for better technologies to arrive and the public will embrace the improvements - given that the price is right and PTA provides a fair playground.

See more about this deal at Ericsson website.