Year in Review for Telecom Industry: 2009

Year in Review for Telecom Industry: 2009

By Aamir Attaa · Thursday, Dec 31, 2009

Pakistan Telecom industry did pretty smooth in year 2009, despite very severe working conditions due to ongoing global recession, hiked inflation, tough competition, law and order situation in the country and increased saturation rate for cellular subscribers.

Growth in subscriber saw a decline when compared to previous years, but that’s understandable. It merits mentioning here that millions of connections went offline during 2009 due to their un-registered or fake registrations status.

Overall Telenor, Warid and Zong did well in terms of adding new customers, showing positive gain in market share. Telenor added 3.4 million customers, while Warid could grab 2 million. Zong stood third in race with 1.47 million customers during November 2008 to November 2009.

Telenor is currently second in terms of Market share, while Mobilink still being at top. Ufone slipped down to forth position with Warid ahead of it at 3rd.

Price war amongst cellular companies remained the same; however the focus was found revolving the 30 second billing packages and SMS packages. Cellular companies started directly addressing each others in TVCs where we saw a clear tussle amongst the operators.

New SIM verification system, emergence of SIM ownership checking system and 668 service that tells number of SIMs registered against your CNIC are considered as major efforts by PTA to eliminate unregistered SIMs. However, fact remains there that PTA is yet to fully eliminate unregistered SIMs from the country.

Mobile commerce hit the surface, with Easy Paisa at the top of rank which offers local remittances through Easy Paisa outlet. Cellular companies also focused on utility bills payment offerings through franchises, service centers and designated outlets.

Taxes on telecom service were lessened by 1.5 percent in budget 2009-10. Moreover, taxes on handset import was also eliminated, however, SIM activation tax is still intact despite high demands of cellular companies.

3G didn’t appear in 2009 too, leaving infrastructure vendors in hard times. Lack of investment from cellular companies is further adding the Burdon on network vendors. Consequently, job situation at infrastructure vendors was seen not that secure.

Job situation in cellular companies is not firm too, as it was before. We saw limited layoffs too, however, still the Telecom sector is considered more secure in terms of jobs when compared to other areas.

Broadband industry successfully increased its growth, with emergence of new WiMAX operators (Qubee and WiTribe), we saw significant base increment in broadband industry. PTCL kept spreading its broadband coverage, while Wateen completed 100,000 customers’ mark. WiTribe is reportedly standing at 27,000 subscribers. Overall there are 550 hundred thousands broadband users in Pakistan, which are expected to cross 5 million mark in 3 years.

Tussle between PTCL and ISPs didn’t end this year too. Though we saw a level of understanding when a mechanism was defined to charge dial-up users per 20 minutes, but broadband operators kept shouting against PTCL for not co-operating with them in terms of new installation.

USF did a remarkable job in year 2009, it continued its ongoing projects and started new one in far flung areas of the country. It was USF that made it possible for customers to avail 1 MB DSL link for Rs. 300. Though ISPs had their reservations over the move and said these rates will kill the industry.