Loud Thinking

Posts Tagged ‘licenses’

 

Pakistan passed the 100 million subscriber milestone in Oct 2010, with five operators fighting for the market share day in & day out, but  still waiting for the introduction of 3G WCDMA technology (High Internet Speed Mobile Access with International Roaming),  to take the telecoms market to the much needed next level.

 

The 3G Licenses auctioned last year in our neighboring country fetched multi billion dollars, in license fee in addition to a similar amount of foreign direct investments, creating a spree of jobs for not only the highly educated, but also for the less educated  skilled hands, working on things like tower construction.

 

The question remains why we are shying away from this golden opportunity, to give the much needed life saving shot to our economy?

 

May be the reason lies in the situation, where the current operators are shying away from the investments that they would have to make, when the licenses are made available and are just keeping a few individuals at the right places “happy”, so that it is deferred, as long as they wish.

 

With the 3G services available in most of the countries of South Asia and even Africa, why  we are being deprived of the technological and economical benefits and playing the catch up game?

 

The 3G License or Spectrum auction, which is just like selling “air” is the easiest way to slightly mitigate the ever increasing unemployment rate in the country. Our peoples representatives in the both the houses should take this up seriously, to expedite the ever delayed process.

                                                                                        By A. Muiz Khan

                                         An update by the writer

Although, 100 Million subscribers may seem a big figure in absolute terms yet, in the backdrop of Pakistan, this amounts to only about 60% Mobile penetration; which is far from saturation, with some developed countries having around about the 100% mark. These figures are obtained after the implementation of the standard active subscriber definition in the industry, which has forced the operators to adopt data cleaning process, so the data comes mostly from the active subscribers, hence, a fairly accurate estimate.

 

Now, the point of adopting 3G is not necessarily to add new subscribers. But if 60 people out of 100 have mobile connections, then to make lets say initially, 15 people out of the active 60, to switch to using the new technology. This will generate new high profit margin revenue streams from data intensive applications, like video calling & HD Video streaming etc.

 

Now, we as a country can benefit from this situation, by putting the technology on the table for Sale. Surely the existing operators cannot shy away from spending on the candy bar, which will ensure a greater revenue stream for them. However, their aim is to delay it as much as possible, so that they do not have to take out cash at this moment of the financial crunch.

 

Once we put the technology or as stated in the article “AIR” on sale, we will get instant payments from the operators on acoount of license fee and as the race to launch the first 3G network kicks off to obtain the First-Mover advantage, huge FDI (Foreign Direct Investment) will take place in modernizing and building the network infrastructure, resulting in effective billions of dollars in earnings and creating thousands of jobs in the process.

 

In the recent auction of the 3G licenses in our neighboring country, only the licenses fee fetched close to USD 15 Billion, which is a huge amount in itself, excluding all the FDI and other positive impacts on the economy, like reduction in unemployment rate.

                                                                                       By A. Muiz Khan