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Government on course to auction more 3G and 4G license in 2015

Saturday, 17 January 2015

After getting a less expected amount of revenue from the Auction of 3G and 4G licensing in April 2014, Pakistan Telecommunication Authority (PTA) seems dedicated once again to auction more licenses of Next generation Mobile services (NGMS).
auction
For this, the regulatory authority PTA has thrown out an advertisement for obtaining expression of interest (EOI) in order to hire consultants for auctioning to unsold slots, 850 Mhz (defunct) and 1800 MHz spectrum, in the year 2015 as a part of its efforts to introduce Next Generation Mobile Services in the country.
According to advertisement, the consultant is supposed to assess the market for the auction as well as attract new investors from outside Pakistan.
Just like the previous exercise of April 2014, PTA has been asked to sell these two slots for the highest possible value.
The April 2014 auction generated $ 1.112 billion for the national exchequer but government could only collect $ 965 million in the FY 2013-14. The two cellular operators, Telenor and Ufone, have yet to pay $ 147 million under an installment payment program that was designed by government itself in order to make things easier for cellular operators.
Not only these two cellular operators enjoyed the partial payment plan but also they were seen cautious at the time of buying spectrum when both bought only 5 MHz each.
A senior Telenor official called the decision “rational” by saying that 3G adoption rate in Pakistan would be slow and 5MHz has enough room to serve the needs in the coming years.
Another official of a telecom company said, “it is too early for the government to think about making more money from the spectrum auction. The entire industry is stuck and planning to deal with re-verification of mobile SIMs that would cause loss of revenue and customer eventually”.
“Instead of putting more pressure on the industry, government should support the industry at this moment in such a way that existing cellular operators could contribute more in the national exchequer through selling more services”, the official added.
Recently, PTA displayed on its website some 5 million 3G subscribers in just 7 months after the launch of 3G services in Pakistan.
There are currently 4 3G and 2 4G cellular operators working in Pakistan who are madly fighting over subscribers by indulging into heavy price war. The PML (N) government still finds the market lucrative enough for another foreign investor.

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