State of Telecom Industry in Pakistan

Much has been written about the way mobile phone service has changed life for the public in Pakistan and elsewhere in the developing world. This blog has covered the impact of mobile services on the Base of the Pyramid in this post. Continuing in the “Benefits” series, here are some of the intangible and productivity benefits listed in the Deloitte study. The study uses the ‘willingness to pay’ concept to quantify the value of intangible benefits.

• Social and family interaction
• Improved access to health services
• Increase in educational facilities
• Disaster relief assistance
• Reduce in travel time and costs
• Improved information flows
• More efficient scheduling of resources
• Growth in small business
• Increased working flexibility
• More opportunities for job search

I’m sure there are many other points which can be included but the ones above cover the major categories. Previously I had discussed the corporate social responsibility to which mobile companies have been a major contributor. 

For something a bit more tangible there are the Mobilink sponsored water coolers, such as this one in Karachi (Thanks to Tee Emm for this picture). I’d like to hear other examples or stories from the readers about the benefits.

Of the many challenges that our nation faces, educating and training of our youth is one of the most important. We need to prepare the next generation of information and communication technology professionals who are skilled, knowledgeable and competitive. We need to cultivate leadership from the next generation who can solve problems through research and innovation.

Currently we face a shortage of skilled engineers and researchers. Even if you combine the graduates of all tiers of universities and colleges, the numbers are far below the need. But there’s an even bigger challenge - are we producing the right quality of  resources? The answer is a definite NO.

There is work to be done in many areas. Funding the right programs, education policy, quality of existing education, training fresh graduates to transition to a professional life etc. I get plenty of mails and comments from students looking for internship or ideas for projects. It is evident from these interactions that many do not have the training to do fundamental research. They also lack the necessary communication skills which are critical to meet the global workforce standards.  The lack of information about what opportunities are available to them further hinders their prospects.

On a positive note there are groups and agencies which are working to make a difference. I recently heard about a promising effort: The National ICT R&D Fund. Here are  some excerpts from an email from the General Manager Solicitation and Evaluation, of this Fund.

National ICT R&D Fundwas created in January 2007 by Ministry of IT with the vision to transform Pakistan’s  economy into a knowledge based economy by promoting efficient, sustainable and effective ICT (IT and Telecommunications) initiatives through synergy of industrial and academic resources. We have significant funds available for proposals that are geared towards  creating ICT related technologies. We have a very positive and nurturing attitude and would like to fund projects that enhance the state of the art and create opportunities by solving industrial problems.

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This is part 2 of the series on economic and social benefits of mobile services in Pakistan. This will focus on the mobile value chain, that is, the share of different stakeholders such as mobile network operators, fixed line operators, handset makers, franchises, network equipment and service providers, government revenue etc. The diagram taken from Deloitte’s study gives a very interesting overview of the mobile value chain in 2006. The numbers (PKR millions) next to the arrows are revenues, those  in brackets represent value add while arrows indicate flow of funds. Click to see a higher resolution view.

Can any one comment on the accuracy of these numbers?

An audio report from Economist.com on the trends in wireless technologies. It is based on the article “When everything connects - The coming wireless revolution“. Towards the end there is talk about how developing countries catch up in terms of technology but face the much severe problems of governance and political instability etc. Sounds familiar, doesn’t it?

The Coming Wireless Revolution

It is widely accepted that mobile phones have made a tremenedous impact on Pakistan’s economy but there have been few if any formal studies about this. Earlier this year GSM Association asked Deloitte Consultants in UK to undertake a study (covered in this post) about the economic and social benefits of mobile telecom services in Pakistan. The main thrust of the study was to find the impact of elimination of taxes on mobile subscription growth. Recently GSMA shared the full report with me. This impressive report has interesting analysis, statistics and charts based on first-hand research, interviews and data from mobile companies and other market intelligence sources. I will share the key findings in a series of posts. To start with, let me highlight some of the interesting points about the Mobile telecom sector of Pakistan:

• In 2006 the sector contributed a total of PKR312 billion to the economy, over 5% of GDP
• Mobile sector employed 210,000 Pakistanis in 2006
• Gain in productivity. PKR94 billion of value add to domestic economy in 2006
• Consumer surplus increased by PRKR42 billion between 2003-06
• Pakistan has one of the highest tax burdens on mobile services in Asia Pacific.

Upcoming posts in this series will include:
Mobile Value Chain in Pakistan, Supply and Demand side impact of Telecom on Pakistan’s Economy, Taxation of Mobile sector, How activation and sales tax impacts mobile growth and Tangible and Intangible Benefits of Mobile Telecom.

We have often talked about the sad state of affairs of Broadband in Pakistan here. Well, KO wrote an open letterto Internet Service Providers (ISPs) of Pakistan in Dec 2004 which was published in Spider magazine. I wanted to share it here because as KO says, Sadly, it’s just as valid today.Yes, most of it is, though for some of us things have improved a tiny bit with increased competition and lower prices. Since broadband situation varies significantly by location, the digital divide within Pakistan is huge as well.

My summarized version of the Wish List follows. Read the full and original version at Wired Pakistan.

1)Reliable and fast Internet service

2) My concern is not the means through which you offer that service, but the quality of the service which I receive 

3) Future plans – I want broadband in the future at lower prices

4) Offer high speeds for LOCAL usage. For example, if I want to transfer data between two computers connected to your local network, I should be able to do so at a minimum of 1MBPS

5) Provide mirrors and local content servers.

6)The days of 15MB and lower mailboxes are long gone. Look into providing larger sized mailboxes and/or web space.

7)Provide a page on your website with the status of your Internet links

8) Provide some sort of customer forums, or online support system

9) Your policy regards VOIP should be clear

10) Start thinking about Video (conferencing) and how your network will cope under video traffic load

11) Provide more Pakistani content

12) Wireless is the only way to provide service to the poor, what are you doing about it?

Do you have anything to add to this list?

Related to the previous thread about PTCL Rebranding, here’s a clip of an ad which focuses on their new identity and new logo. Nice effort but after a month or so of this “New Beginning”, more serious challenges have surfaced for PTCL than rebranding. The next year is crucial and will make or break PTCL. Lets hope for the best.

I have previously discussed the explosive growth of media captured on mobiles and the need for sharing it, to make it work without putting too much burden on the users. A few interesting trends have emerged in the last few months. PixSense has picked up momentum and their solution was implemented by Telenor - great news for this Pakistani startup. At the same time, Nokia has been on a roll, acquiring soical networking and mobile ad startups such as Enpocket. Nokia has also introduced Ovi, a set of services for mobiles, which needs a post of its own. Twango, a media sharing application, is one of the companies Nokia bought for around $100 million. Naturally that caused headlines and prompted many (including myself) to take a look at Twango’s services.

With so many photo and video sharing sites (photobucket, snapfish, mobango etc) it can be hard to compare and select one. What is it that makes one media sharing site better than others? I believe its a combination of a few factors. Usability and presentation. Features such as online editing, tagging, time lines, subscriptions etc. Ease of sharing with people (without forcing them to register) and at blogs and networking sites.  There’s the reliability and trust element as well; many don’t want their personal stuff uploaded to a random startup with sketchy privacy policies.

TM has posted a detailed analysis of Telenor’s Picshare launch and gave it a 6/10 rating. I recommend read the full review and the related commentary at TGP. In this post I’ll review Twango, its features and how it works. My usage scenario is simple and typical. I want to be able to share my media easily with friends and family anywhere in the world.

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Continuing the coverage of 3G and WiMAX, here’s a research paper by a grad student at Colorado University, which provides the point of view that 3G technologies have an edge over WiMAX. I wanted to share it to see what you think. For those who are interested in a detailed comparison, it is a good reference. Note that the context of the paper is North American market so the conclusions do not necessarily make sense for other markets such as Pakistan.

Here’s the source of the abstract, full paper is here.

There has been much conversation over the past few years regarding the evolution of next-generation air interfaces supporting mobile broadband. One of the most talked about as far as promise is concerned is 802.16e, otherwise known as mobile WiMAX. In its advertised form, the standard can support data rates of tens of megabits per second while supporting many real-time user applications that cannot be supported by third-generation technologies. Although mobile WiMAX sounds promising as a next-generation technology, other factors do exist which will limit its overall success. Some of the factors that will be discussed in this paper will include the design challenges facing base-station architecture, competing third-generation long-term evolution (LTE) technologies, and costs to existing service providers to upgrade their networks. This paper is meant to demonstrate that from a service-provider’s point-of-view, the upgrade path to mobile WiMAX may not be the correct solution.

Green & White, a blog about technology, start-ups and hiring in Pakistan is  stepping up its efforts to support entrepreneurs in Pakistan. This is a blog on which I contribute as well. The timing for G&W 2.0 is great because we see a number of interesting changes in the technical landscape, both globally and in Pakistan. Essentially the Pakistani society is moving away from the traditional modes and professionals are willing to take more chances.

Blogs and online discussions have a unique place for the various stakeholders (entrepreneurs, investors, media, students, businesses). There are only a handful of folks who are active in this area and Green & White has taken a lead at providing interesting analysis and information for many technology and growth areas. My advice: It takes a lot of time to cause change so build and expand networks, provide information and insights which helps others and … keep going.

In case you are wondering about the coffee cup up there, it represents “coffee sessions” with Osama Hashmi, the managing editor of G&W!

Here’s a sampling of some recent interesting stories from G&W:

• TiE Launches Khudee
• Telenor Launches Comics on D Juice
• Flexible storage business and other implications of the e-crimes bill 2007
• Orgoo - All-in-one Communicaiton Kit

Media is abuzz with news about reduction in force and restructuring at PTCL, which has 65000 employees. We have provided various views and news about PTCL at this blog before. Going through the time lines since last year, one can see that PTCL is at a critical junction. Depending on who you ask, PTCL is a management fiasco or a great opportunity. The stakeholders in this story include staff and workers (who have a union), Etisalat which manages PTCL with its 26% stake (and would like to get additional 25%) and the Pakistan government. The PTCL union leaders have announced their opposition to cut jobs. The state has not responded yet.

Significant questions have been raised by concerned public in media, blogs and online discusion forums about strategy and operations of PTCL. There are those who question the whole privatisation deal and whether it was good for Pakistan. Others point out to the hefty price paid by Etisalat and feel that this was the best possible option. Anyway, there is no going back to the days of state-owned monopolies in the telecom market of Pakistan.  It is clear that Etisalat is trying to turn around a big ship and it will face considerable difficulties on the way.  Even though job cuts are hard, in the long term there is no way around them. I want PTCL to get its act together and thrive in a fair and just manner.

According to Farhan Bokhari in the Gulf News:

As Etisalat moves to increase its stake in PTCL, it will inevitably be left with few options other than to work towards a robust plan for reforming the company with the ultimate objective of tackling its falling profits. Unless PTCL’s profits are not just lifted but turned into significant gains, the company’s long term outlook is likely to suffer.

While PTCL has been privatised for some time now, the Pakistani public is yet to witness the fruit of the change of management from public sector to private sector. Pakistani consumers may have seen the benefit of this change in ways such as much easier access to new telephone connections that once took several years to be provided.

But the quality of service by PTCL’s staff in areas such as dealing with complaints from subscribers still remains of simply pathetic quality. Stories such as subscribers waiting for several days before the PTCL staff were able to deal with out-of-order phone lines in rain drenched neighbourhoods still make the rounds across Pakistan.

Read on for more background.

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Here’s an application demo on a topic about which you will hear a lot in the coming days: Group and Integrated Messaging. Found out about SwarmTeams at InBabble where there’s an interview with the founder. This looks promising and is something which I could really use. What is your take?

A bit of background which may be interesting to you: Swarmteams has been developed in response to research into biological teams and groups (aka “bioteams”) such as micro-organisms, ants, bees and dolphins. The principles include: