State of Telecom Industry in Pakistan

In this post we take a look at the role of advertising in building brand equity, using the case of Wateen’s recent product launch. Advertising is paid form of marketing promotion in which the sponsor is advertised and the message is controlled. Brand Equity refers to the value built-up in a brand. It is measured on a scale determining the extent of customer awareness. Besides awareness, brand equity is also directly related to the consumer’s experience with the brand itself. This experience finally decides the fate of product in terms of success and brand loyalty or failure within the potential target audience.

Within Marketing Mix i.e. Target market and 4P’s (Product, Price, Placement, Promotion), Product refers to the promise made to the customer or solution provided to the customer. Value is the perceived difference between the costs spent by the customer against achieved benefits. The lower the cost in relation to the benefits the lower is the value.

Hence, marketing communication or advertising during the product launch is a strategic decision and must be handled with care. Launching the product or service aggressively without practically placing it or making it available might bring critically negative impact on brand reputation. Such campaign destroys instead of building a brand. It is just like a promise made to the customer and then not being fulfilled. Such mistake at launch stage, specifically in case of a product like WiMax which still have to struggle a lot in getting mass awareness and with delivery issues, can severely disrupt the company’s and brand’s image within early adaptors of the product.

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PTA issued this warning in local newspapers (source: TGP). I see two good things here: First, the action to move agains the unwanted text messages and a number where people can call to register their concerns. Second, the ad copy is mostly written in urdu terms, avoiding unnecessary English terms about which we complained earlier. But note how Telenor becomes “Telenar” as written here.

Good start but this will require more work by PTA to clarify the “code of conduct” for sending sms. I hope that soon we will see some more information on PTA site about this initiative.

I came across this interesting use of mobile phones to track kids in Japan. More on this below but this story prompted me to write about the bigger issue of kids and technology. The amazing pace at which communication technologies have advanced has both positive  and negative aspects. In this post I’ll limit the scope of discussion to this question: What should a parent know about young children’s interactions with mobile phones? 

According to this research 10-12 is the average age at which kids get a mobile phone. Reasons most often mentioned security and peace of mind. Naturally kids like to play with gadgets and they can learn plenty of things even if they just play games. Usually parents will depend on their kids to configure the phone’s different features. But that’s not all – there are many potential hazards as well. In a (relatively) conservative society such as Pakistan, access to a mobile phone (even without network access) can create some difficult situations. Teenagers are early adopters and usually are tech savvy but they are also emotionally immature. An article in the June issue of Flare lists the following dangers when children use mobiles: snatching, scamming, exposure to inappropriate material, (possible) health danger and risk of other criminal activity.

The other aspect is how the phones are used? What limits are set for the usage? The social activities of the youth is a whole different chapter which is not possible to cover here… simply put mobiles make it easy for kids to go towards uncharted territories. I don’t think most kids need a phone - unless they can demonstrate a real need AND maturity.

Back to the tracking story, from Japan’s Cellphone Edge.

A Japanese company, Tokyu Security has built a system that tracks a child’s movement across public transportation, school and pre-school domains and reports the results via mobile phones to parents. Every time their child passes the installed checkpoints, parents get a notifications such as the one shown below.

Invasion of privacy or parent’s right? Read more about this technology to track kids in Japan.

The notifications are usually emailed to parents’ mobile phones reporting such information as the child’s name, time and station where the child got onboard or got off the train. The checkpoints at school inform the time of arrival.

Tokyu Security makes use of PASMO cards, the rechargeable IC cards, and special reader equipment to implement the system. Scheduled for launch in December, the service will be offered at all Tokyu line stations in greater Tokyo except Setagaya line and Shibuya station. A subscription fee of JPY525 (USD4.66) must be paid every six month to keep the service activated. The service will target elementary and middle school children.

Nokia has made a welcome move to further tap into the Islamic VAS market, as reported here and at many other blogs. The N73 phone from Nokia was introduced in Middle East this week. It is packed with Islamic content and applications. This special edition should become popular in South Asia too, as it supports Urdu and has many desired features.

The new Nokia N73 Special Edition includes a unique portfolio of pre-loaded applications including a collection of Azkars for the morning and the evening, an Islamic Organizer with audible alarms for the five daily prayers, a Qibla direction indicator and a Hijri calendar. The Hajj and Umrah application provides simple step-by-step descriptions for the Hajj and Umrah, while the Ramadaniat application explains all the instructions and rules for the Holy month of Ramadan. Also included with these on the 2GB miniSD card are two Islamic e-books and a Universal Dictionary application which supports English, Arabic, Farsi, Urdu and French.

‘In addition the Nokia N73 Special Edition offers unique Ramadan Greetings, a very special customized e-card application that enables families and friends to send greeting cards through SMS or MMS in celebration of this Holy month’ said Neil Gordon, Vice President for Multimedia, Nokia, Middle East & Africa, ‘This new edition is a reflection of Nokia’s commitment to continuously provide consumers with tailored services, based on their needs and requirements.’

In addition to the pre-loaded content consumers using the Nokia N73 Special Edition can also download other additional applications. Downloadable content includes the Name of Allah application, exclusively available for Nokia users as well as a third e-book.

N73 is available in 3G, quadband EDGE/GSM networks.

If you or someone you know has used this phone, please share your feedback with other readers of this blog.

Intel has developed a Solar-Powered WiMAX Base Station Solution (pdf), as reported by Daily Wireless. Total system cost is around $10,000. The complete report details the electricity consumptions and savings. Any chance we will see one of these in Pakistan soon?

In remote sites where there is no grid electricity, the cost of a diesel generator can be as high as 40 cents per kWh, including the cost of fuel delivery to the site. In some cases, an electric generator is transported to a repair site, which also adds to the cost.

With a lifetime of 25 years for the solar panels and 15 years for the battery array, Intel says these solar systems can generate electricity at a cost of 33 cents per kWh.

A daily consumption of 69.48 amp-hours, is multiplied by 1.2 as a safeguard factor to account for a slow loss of capacity over the lifetime of the battery. To compute daily power consumption, the base station is assumed to consume power equivalent to a 75% duty cycle at peak power consumption.

To provide a sufficient charging current of 18.53 amps, a total of eight, 200 watt SHARP ND-200U1 panels (pdf) or ten, BP Solar SX 170B panels (170 watts each) are connected in parallel to charge four, Rolls 5000 batteries.

To recharge the battery array, with an average daily recharge time of 4.5 hours, the solar panel modules should provide a current of 18.53 amps. The peak current drawn is 3.86 amps.

The ACM (Association of Computing Machinery) SIGCOMM Workshop on Networked Systems for Developing Regions (NSDR) will be held at Kyoto, Japan, 27th August, 2007.  SIGCOMM stands for Special Interest Group on Data Communication.

The purpose of NSDR 2007 is to provide a venue for researchers to propose and discuss ideas and to participate in the sustainable development and deployment of Internet and communication technologies specifically aimed at developing third world countries.

NSDR program is online and the conference sessions will be broadcasted live. See DRITTE site for background of organizers.

The following workshops will be held in conjunction with SIGCOMM 2007.
- Mobility in the Evolving Internet Architecture (MobiArch)
- Large Scale Attack Defense (LSAD)
- Networked Systems for Developing Regions (NSDR)
- Internet Network Management 2007 (INM)
- Peer-to-Peer Streaming and IPTV Systems (P2P-TV)
- IPv6 and the Future of the Internet (IPv6)

From Road to WiMAX, a Businessweek special report. The story offers a learning opportunity. It is a historical view of how new technology ideas and products such as WiMAX were promoted as a solution to a problem (better broadband), how alliances were forged around the world, how standardisation battles were fought and how other challenges were dealt with.  I have included two additional items which are not part of the BusinessWeek report. First, to give you a flavor of the worldwide campaign by INTEL to push WiMAX, follow this link to a video from Intel. Second, click on the thumbnail above to see a larger view of Intel’s WiMAX roadmap.

Certainly there is plenty of work ahead for WiMAX before it can be termed as a success but it has come a long way. Pakistan was among the first countries to jump on the WiMAX bandwagon. The BW article mentions, “More than 65 countries, including Mexico, Brazil, and Pakistan, are deploying the service.” Although this report article does not provide details, one has to keep in mind that these deployments vary from limited area trials to bigger plans and the prices are THE major barrier for the populations of developing countries. 

The article also has a slide show about the pioneers behind the technology and business of WiMAX. Here’s an excerpt:

How Intel’s Sean Maloney shepherded through the technology that’s poised to rewrite the rules of wireless

Indeed, after logging hundreds of thousands of air miles, he has rounded up a remarkable coalition of chip, PC, consumer electronics, networking, and software companies in an effort to radically reshape the future of broadband with what’s now called WiMAX.

Intel faced withering criticism from tech analysts when it first cast its lot with WiMAX, but the critics have toned down their rhetoric. That’s because dozens of wireless telecom operators around the globe have also placed bets on WiMAX and plan to spend $13 billion over the next few years to build 300 such networks. In July, Sprint Nextel Corp. teamed with Clearwire Corp. (CLWR ) to create a nationwide network covering 100 million potential customers by the end of 2008. Already the first transmitters are appearing on light poles and towers in Chicago and Washington, test markets expected to begin service early next year. Major rollouts are planned everywhere from Pakistan to Australia to China by 2009.

Technology blog site Engadget is creating waves with stories of complete unlock of iPhone. It first reported iPhoneSIMFree’s success in unlocking the iPhone — a project that’s been ongoing since the late June launch of the smart phone — and confirmed that the hack works. Engadget said the unlock remains intact even after applying the most recent firmware update, and posted a short video demonstrating the iPhone connecting to and making a call over the T-Mobile network.

The post claims that iPhone software unlock is legit, and we have proof. “We can confirm with 100% certainty that iPhoneSIMfree.com’s software solution completely SIM unlocks the iPhone, is restore-resistant, and should make the iPhone fully functional for users outside of the U.S.” said Ryan Block on Engadget.

Too good to be true? Nope — the iPhone software unlock mentioned a couple days ago is legit. As what seems like teams of people worked on various avenues to unlock this thing, the iPhoneSIMfree.com group was silently plugging away behind the scenes. Our own Ryan Block got together with them and demoed their wares and reports back with some detailed findings.

There’s also some talk that certain sites will offer unlocking services for a fee. Too good to be true, just rumours or a limited opportunity? The situation will be clear in the next few days. Who knows, I might go for one of these iPhones.

This view of convergence caught my attention. This is from the recently released research work by Ofcom, the regulator in UK. Obviously the text in this diagram has references to UK providers and services, but nonetheless it is a good snapshot. Despite the late start and domestic problems, Pakistan got in the game at a good time and has caught up with others.

 The report (page 20 of part 1) mentions the 3 major areas where convergence changes the playing field:
• Content – offering an opportunity for content producers to create use mixed-media formats (e.g. TV/interactive/web) and new ways to distribute existing content;
• Networks – upgrades that widen the capabilities and capacity of historically separate and single-purpose distribution infrastructure; and
• Devices – the creation of equipment that offers functionality typically delivered on stand-alone devices.

There’s plenty more in the 187 page report, in case you are interested.

From New Scientist Special Report. The idea is summed nicely by this statement from the report: In the developing regions you have hostile conditions for a PC so phones have a lot of potential to become the computing platform for people.

Two proof-of-concept cases studies from India illustrate how. The first one is about converting banking paper forms to digital version using mobile phone. The second one is about educational video games that run on smartphones.

Is there a similar case study which you can share?

Micro-lending groups are typically run by women in rural areas who arrange small loans for each other or act as mediators between banks and the local community. They have proved to be a successful strategy in sparking business endeavours and combating poverty. But one problem is that these groups often keep poor accounts, which can make it difficult for banks or other lenders to invest in them with confidence.

“When banks are interested in lending to these people, if they’re lucky the groups will have a stack of paper records,” says Tapan Parikh, a computer scientist at the University of Washington in Seattle who works with micro-finance groups in India.

Typically, these records would include forms stating the agreed amount, duration of the loan and repayment receipts. Parikh learned that group members prefer the paper forms because many can’t read and so fill them out by memorising which numbers go in which boxes. As a result, he stuck with paper but turned to camera-phones to make the accounting process more secure and transparent.

He created a new version of the paper forms, which look like the old ones except that a barcode has been added next to each box or section where you need to fill in numbers. Instead of filling out these new forms, you take a picture of each barcode with a cellphone. Software on the phone recognises the barcode and a message appears on the screen, prompting you to enter the figures that would have gone in the section that corresponds to that barcode. There is also a spoken version of the message to make things clearer for those who can’t read. In this way, the borrower or lender scrolls through the whole form, taking snapshots of the barcodes and entering data via the phone’s keypad. The result is an electronic version of the form, which is initially stored on the phone and later uploaded to a central server when the phone is near a mast.

Learn English by phone

It isn’t just the photo and video features of smartphones that are useful to people in the developing world. The advanced graphics and high-speed chips they come with are being harnessed to build educational video games.John Canny’s group at the University of California, Berkeley, found that the language skills of some English teachers in Mysore, India, were lacking and that children were often kept away from school to help with chores. Yet 19 of 47 students had parents with cellphones.

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In my last post I referred to an article about broadband prices in terms of average salaries. As readers pointed out the numbers there were not a good representation of broadband costs. In case of Pakistan the $106 figure for 100kbps was too high. The fine print mentioned that the data used in Wired illustration was from ITU. I am sure it outdated, and the broadband prices have fallen significantly in the last year in Pakistan. There are other considerations as well which were not taken into account in that comparison.

For one, broadband prices are not fixed in a country but vary. As shown in the chart below, based on the OECD data, the range can be significant. (Source)

Second, there are many other factors which should be taken into account when comparing the broadband prices for different countries. A recent report from the UK communicaitons regulator OFCOM writes about this with the title:

The complexities of quantifying broadband prices

A recent OECD report compared the lowest prices for broadband, on a cost per Mbit/s basis, across 30 countries, of which the UK ranked 16th. The UK data came from three ISPs (BT, HomeChoice and Telewest). As such it excluded pricing data from several leading LLU operators which are gaining market share as a result of their low-priced offerings. The report also looked at broadband prices in isolation, despite the fact that so many consumers now buy broadband as part of a bundle of services.

In the OECD’s analysis, Japan, which has implemented fibre to the home (FTTH) offering speeds of up to 100Mbit/s, had the lowest cost per Mbit/s. However, it is difficult to make a direct comparison of broadband packages between countries; differing topographies and population distributions mean that a service which is economically viable in one country may not be in another, due to the level of infrastructure investment required. UK
broadband providers have not yet seen a rationale for the rollout of FTTH, meaning it is unlikely that the UK will be able to challenge the cost per minute of those nations with FTTH in the near-to-mid term.

There are also problems with using cost per Mbit/s as it fails to take into account that many consumers have yet to see the need for broadband speeds in excess of those already available in the UK.

Although international comparisons of broadband offerings and prices, such as the OECD report, can be useful, more complex analysis, taking into account service bundling and other points of service differentiation (such as data caps) is required.

Sources:
OFCOM Report from UK (Part 3 of the pdf reports)
OECD Report – Over 100 pages PDF

September issue of Wired magazine has an interesting and colorful illustration in which broadband access cost of various countries is expressed as a percentage of their monthly incomes. Pakistan was featured there as well, as you can see below (click to see a higher resolution image). The headline screams: Access Denied. Broadband service is available worldwide (to 3% of the population) but it’s beyond most people’s budgets, it adds.

I’d leave it to the readers to determine whether the number mentioned there for Pakistan: $106.9/100Kbps, is right or not. Oh, and don’t miss the comment about the bloggers in Pakistan.