Data usage in Pakistan is double than anyother country

There is a very high demand for broadband data connectivity in Pakistan. The data usage in GB / month on a per subscriber basis in Pakistan is more than double than in any other country in the world including the advanced and developed markets.

Mohammad Raheel Kamal, Senior Director Global Business Development at Qualcomm focuses on the introduction of 3G in Pakistan. What he thinks about the Pakistani cellular market is as follow;

How does Qualcomm see Pakistani region with respect to wireless communications?

Mohammad Raheel Kamal, Senior Director Global Business Development at Qualcomm

Keeping in view the current telecom landscape of Pakistan and the tremendous growth that has been witnessed in the past decade, Qualcomm believes that Pakistan’s wireless market has all the prerequisites for progressing to the next level which is connectivity to the Internet via high speed mobile broadband access and the availability of feature rich applications & value added services in all corners of the country.

We believe that with appropriate planning and implementation, Pakistan’s telecom market has all the potential for a successful business case, not only for local but also International operators, which will help improve the foreign direct investment in the country.

The trends are shifting towards the need for data on-the-go. The users demand connectivity and access to the same information and services regardless of their location, home, office or on the road. Desktop computers are being replaced by laptops and smartphones. Users are demanding broadband connectivity wherever they take their devices. This can only be addressed by providing wireless broadband access in the country.

The difficulties and high cost of deploying fixed line infrastructure do not justify the investments into fixed networks anymore. With very limited existing fixed line infrastructure, Pakistan is well poised to benefit from the developments in the wireless domain.

What is the difference between EV-DO, WiMAX, 3G and 4G and which technology will be successful in Pakistan ultimately?

2G, 3G and 4G all refer to different generations of cellular wireless communication standards and technologies. The technology deployed by the mobile operators in Pakistan is GSM which is 2G or the second generation technology. The 3G technology provides very high speed mobile broadband data and has been deployed by over 660 operators in the world with over 1 billion 3G subscribers today.

3G has two renowned flavors, first one is CDMA and its evolution path with CDMA2000 1x Advanced and EV-DO Rev A, Rev B and DO-Advanced for the data side. EV-DO Rev. B is the latest technology being deployed in the world today.

The other 3G flavor is the WCDMA / UMTS evolution path where its data side is referred to as HSPA. HSPA+ R8 is the latest revision which is currently in deployment / commercialization phase in different parts of the world.

LTE will boost data capacity in dense urban areas to complement 3G’s ubiquitous data and voice coverage. Operators can cost-effectively evolve their 3G networks to offer similar performance as LTE (while using same number of antennas and bandwidth) while LTE initially will be an overlay augmenting data capacity. LTE is an excellent tool for operators to leverage new and wider bandwidth (up to 20 MHz) as well as TDD spectrum.

LTE-Advanced is the leading candidate for IMT-Advanced, which is commonly referred to as 4G. LTE Advanced is undergoing standardizing process by 3GPP in R10 for completion in 1Q 2011

LTE and 3G are on parallel evolution paths and both will continue to evolve in parallel.

The WiMAX technology has not been very successful and has failed to gain traction worldwide. The total WiMAX subscriber base according to various industry analysts, stands at about 3 million whereas 3G adds these many subscribers every 4 days and has a combined subscriber base of over 1 billion.

3G has been very successful worldwide and has a very strong evolution path. It is a mature and most widely deployed technology and has an established ecosystem, enjoys economies of scale with tremendous availability of feature rich handsets and devices at very affordable prices, extremely high global vendor support and a huge subscriber base. All these factors reaffirm our belief that 3G is the right technology choice for Pakistan.

Do you believe that a very low ARPU and weak buying power will help spread the 3G / 4G in an estimated way?

The mobile operators in Pakistan have seen declining ARPUs over the last few years and have probably the lowest ARPU in the world and that is because all of them are still using old technology which does not allow them to offer compelling applications and services that boost operators’ revenues. They can only compete for voice subscribers and the only way to differentiate themselves is on the basis of tariffs. To acquire more subscribers they keep lowering their tariffs and have reached a point where it has become very difficult for them to sustain the business and maintain their profit margins.

There is a very high demand for broadband data connectivity in Pakistan. The data usage in GB / month on a per subscriber basis in Pakistan is more than double than in any other country in the world including the advanced and developed markets. The users are willing to pay much more for broadband data connectivity than they are for voice. The wireless data plans offered in Pakistan range anywhere from about $10 per month to $35 per month. In comparison, the voice ARPU is only about $2.50.

With very high data demand and the computer and 3G device prices becoming very affordable even by the Pakistani standards, the 3G and 4G technologies will certainly increase data penetration rates in Pakistan. Given the affordability, the 3G technology, in all flavors, remains poised and most suitable for providing wireless broadband access as well as rich content and value-added-services to the users in Pakistan.

What are the challenges for Pakistani operators to adopt 3G / 4G?

Some operators in Pakistan have already launched 3G in the EV-DO (Rev. A and Rev. B) flavor on a commercial scale. The initial service offering is based on USB data modems that connect to computers and laptops providing extremely high wireless broadband data speeds and connection to the Internet.

We have seen that the introduction of the 3G technology by the mobile operators has received an overwhelming response in many countries across the region. However, the mobile operators in Pakistan are still on the 2G technology. There is a need for additional spectrum for them to be able to launch 3G. Unfortunately, the 3G spectrum auction has been delayed for almost 3 years now. The Government of Pakistan seems very serious this time and seems to be taking concrete steps towards making the spectrum auction happen in the very near future.

Another issue that needs serious consideration is the anticipated spectrum fee from the auction. The operators have invested a lot of money in their existing networks; making the spectrum available at reasonable prices will help mobile operators do wide scale 3G deployments. The regulations need to ensure that the government’s expectations are met in terms of 3G coverage availability across the country according to a predetermined timeline.

Once the licensing / spectrum auction process is completed, the mobile operators will need to do proper network planning, deployment, and optimization to ensure good quality of service is provided to the consumers. Introduction of appropriate 3G handsets and devices with compelling applications that address local needs would help realize the benefits of the technology

What steps should be taken in order to make 3G / 4G a success in Pakistan?

3G is a fully mature and most widely deployed mobile technology and should be introduced in Pakistan at the earliest. The delay in licensing / spectrum auction is not only depriving the consumers from accessing a wide range of high speed mobile broadband applications and the access to the internet, but also acting as a hurdle in the success of the Pakistan telecom sector that could give the overall economy an incredible uplift.

The 3G technology when put to use in sectors like mobile health, distance learning, mCommerce, entertainment, gaming, local based services, etc., will contribute to the economic development of the country by boosting the national GDP and the average per capita income. Other countries in our region have already moved ahead with 3G deployments and are reaping the benefits. Level playing field and equal opportunities should be given to all operators in the country and they should be allowed to offer any services on any device under the unified licensing regime. The 3G auction has been very successful in the countries with similar demographics and income levels as Pakistan and there is good reason to believe that Pakistan will also be a success story.

This interview has been published in the August 2010 edition of MORE Magazine. Digital copy can be downloaded from this archive (MORE Magazine Archive)

Tags: 3G, broadband, Interview, LTE, Telecom, Wimax