Babar Bhatti
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The telecom honeymoon in Pakistan which lasted about 5 years (2002-2007) allowed Pakistani consumers to leapfrog over older landline based infrastructure and get cheap and quick access to modern telecommunication technology. The investors, telecom businesses and Pakistani treasury – all made good money and it was a win-win situation. It seems that the golden period for Pakistan telecom is over. The spike in teledensity and corresponding load on the new infrastructure is causing a number of service issues. To add fuel to fire the telecom rates for calls to Pakistan and within Pakistan have started rising, causing a lot of concerns. Consider the following points from the last few months:
Deceptive advertisements by Mobile Companies
Rise in local call charges by PTCL
Calls to Pakistan made more expensive
PTCL forces Pakistan package on its customers
Customer service calls are not free any more
Telecom consumer protection laws still in draft
Other emerging cosumer gripes
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Some people hold the view that given the tremendous progress made, complaining about telecom situation in Pakistan is not justified. Yes, there have been great advances made but if we do not fix the structural issues early on, we will lose much of that progress. Left unchecked we may even regress to a point where there’s plenty of competition but consumers end up without the services they deserve at a fair price. Broadband is an appropriate example. Pakistani public has been tormented with poor service and caps on the usage.
I believe that with the right regulatory measures, consumer protection laws and a code of ethics we can keep the telecom sector on the right track.
Crowded Ice House for Capitals in camp.(SPORTS)
The Washington Times (Washington, DC) September 18, 2006 Byline: Dave Fay, THE WASHINGTON TIMES The players at the Washington Capitals’ training camp are crawling all over each other in the tight quarters at Ashburn Ice House, but it could have been worse. It could have been a lot worse.
“Don’t forget, we had rookie camp [in July] up in Hershey, so we’ve already seen the kids,” general manager George McPhee said. “If they were here, you wouldn’t be able to move.” No argument there. About 35 drafted rookies and invited free agents were at the Hershey camp. Add them to the 49 players in this camp and it really would have been cramped. web site ashburn ice house
The Caps are waiting for completion of their $43 million training facility atop a parking garage next to Ballston Common Mall in Arlington. It was scheduled to be finished in late August. Instead, it won’t be ready for another five weeks. Had it been on time, the Caps would have had room for 80-plus players in camp.
“Actually this isn’t such a bad thing for the coaches because they can get the numbers down in a hurry and a camp this size is much more manageable,” McPhee said.
The majority of the players, with the exception of a few veteran free agents, at Ashburn Ice House played in Washington last season or for Hershey in the American Hockey League. That means little time is wasted skating around awestruck rookies, and prospects can get right to the business at hand.
“We’re not trying to find slots for people. We pretty much have a good understanding of who can do what,” coach Glen Hanlon said. “My philosophy is the players we had last year get a running start. Their slots are theirs for them to lose. There are a couple slots that are open for competition, and what we’re saying to them is, ‘Come in, give us an NHL-like camp and you’ll go from being a projected AHL player to an NHLer. We’ll make the right decision, and you’ll play in the league.’ We’re hoping somebody will force us to make moves. That is always a positive.” “Based on performance, you hope you’re forced to keep 25,” McPhee said, citing a figure two above the league maximum. “You don’t know about roster size until the end of camp usually. You should have a pretty good idea of who’s going to be here, but you’re always hoping for a surprise, somebody you didn’t count on. We’ve got some players on the bubble, and we want to see here whether we can count of them for the long haul or if they need a little more time in Hershey.” Based on yesterday’s scrimmage, it will be a competitive camp. Two teams went through about an hour of scrimmaging with almost no scoring – a plus for the goalies and defense, a minus for the shooters. ashburnicehousenow.net ashburn ice house
“Lots of the things we’ve been working on are designed to help the defense,” Hanlon said. “If we had had a 10-9 game, I’d really be concerned. It looked good today.” Notes – Alex Ovechkin celebrated his 21st birthday yesterday with his family in their Virginia home, but not before right wing Matt Bradley nailed the reigning NHL Rookie of the Year in the kisser with a cream pie as about 500 fans applauded gleefully at the Ice House. Ovechkin is wearing new skates this season that will make him stand out even more – Vector 10.0 models made by CCM. There are chrome-like plates on the sides that reflect light as he skates. .. The stands at Ashburn are generally full but hold less than half the 1,200 who could jam into Piney Orchard in Odenton, Md. .. Defensemen Bryan Muir and Jamie Heward and forwards Chris Clark and Dainius Zubrus, all of whom had offseason surgery, are being held out of contact drills. .. Defenseman Jakub Cutta, who played well for Calder Cup champion Hershey and was offered a qualifying offer, has instead signed with a team in Europe.
I can not agree/disagree with the premise that the honey moon is over due to lack of information. I hope it is something the Telecom Industry anticipated and is ready to overcome the challenge associated to growth and maturity.
When I was in Pakistan – 2006 and tried to see if I can work from Pakistan just as my Indian buddies.
Found out the cost of getting 1MB (uplin/downlink) was 2.5 lakh. One line was shared by many. Now I hear that with recent PTCL fiber optic network installation in many of the cities (unfortunately not all), the cost has dramatically declined. Now you can get 128KB (which is decent if you wanted to work from Pakistan).
I remember paying for a crapy service for 12000 ruppees which provided me the same or little better service then 56kb provided.
I hope Pakistani Telecom Industry leadership can overcome this issue.
Thanks for the post.
I think the market is now getting saturated so we will see some of the good offers disappearing
In some ways things had become TOO GOOD for consumers and artificially cheap
I agree that the “honeymoon” was unnatural and the costs had actually come down so much that companies could not just survive this way. So as you move away from the cut throat competition the prices will have to stabilize at a more reasonable place. The costs are still VERY low in Pakistan compared to international standards I think.
It amazes me that your call rates are going up, because here in India we enjoy the lowest call rates anywhere in the world and it looks like they’re only going down further!
Regardless, the Pakistani market for consumer telecommunications remains excellent when you compare it to highly developed infrastructures and “free-markets” like the U.S. I pay an absurd amount for cell phone service that I barely use; you basically cannot buy a plan for less than $30 a month…and by the time they finish taxing you and charging fees for this and that, it comes around to more like $38 per month.
Also, “texting” is not nearly as popular amongst 22+ adults in the U.S. as it is in Pakistan (the last time I sent a text message in the U.S. was probably a year ago). Texting is needlessly expensive–usually around 10 cents per message sent or received…T-mobile even charges me for the stupid spam they send me every now and then!! Don’t even ask about the mess one has to deal with when buying a simple handset.
As far as rates are concerned, I bet they’re going up because the market is starting to stabilize; it’s perhaps surprising that most telecoms are actually not profitable. So I wouldn’t be surprised if India sees the same increases as well, as soon as the acquisition and merger hype starts to cool and businesses actually start thinking about earning money.
Just look at Sprint….despite its astronomical charges..it’s still not profitable.
Also, deceptive advertising is a worldwide problem. Look no further than the housing crisis in the U.S.; even with a 99% literacy rate, people STILL signed up for loans they could not afford…simply because a lot of them just didn’t fully grasp what they were committing to!
I agree with Eidee Man, even with the changes you mention, telecommunication costs in Pakistan remain amongst the cheapest in the world. Maybe even too cheap because of the fierce competition between providers.
Good post. Yes, the honeymoon is over, because it was just a honeymoon.
I do think that this is just about consolidation mostly. However, you are right some of the structural issues also need to be resolved.
But I really think that there are also too many companies in Pakistan. The market is just not that large. So, some of them will have to fall off or get merged because the market is probably likely to keep only about 3 or so, the others will just disappear and then we will have more stability in price as well as service.
There are many aspects in which Pakistani telecom consumers enjoy great deals – SMS is one. The source of many problems is PTCL as it struggles with the competition. Overall situation with voice is not too bad. If broadband problems are addressed then we will be in much better shape.
well the problem is in our infrastructure due to which these issues arise. PTCl not giving proper internet speed telecommunications rising prices. But we can not deny the fact it was due to this huge comeptition in telecomunication world of pakistan due to which this progress has been made and people are enjoying benifits which were un imaganable before like free sms, free talk time and plus extra balance. Ithink this rise in prices will be temporary because the new companies will come in pakistan market becauses of huge margin of profit and competation will increase ultimately lowering prices but the consumer problem will remain due to lake of proper planing to attract consumers and the loyality of the consumers will also effect due to lake of planing.
Very surprising that a same headline was used in AURORA magazine’s Nov-Dec 2007 issue, to describe the Television industry. Althoiugh a very common line I am sure, but nonetheless the writer could have shown some originality instead of coping other people’s work.
Next step will be that companies will merge and consolidate.
growth through new users is reaching its limits now it will ne more growth through new services and revenue centers.
I hope that the wireless carriers will now work on finding ways to offer more services, particularly data and location services, to augment their ARPU. For example, new data services services could improve the Internet penetration in Pakistan using the most ubiquitous device, the cell phone.
Pakistan could lead the way to mobile Internet. Farmers could benefit by accessing market prices and weather reports via SMS. Instead of just signing up more voice users, the carriers need to think more creatively by offering more, better service to improve their top and bottom lines. There are myriad ways to keep the telecom/information revolution going in Pakistan. We have only just begun.
I must say that the article was written by a myopic writer with little or no hindsight of the telecom industry. The last five years were of course the honey moon period for the PTA and the consumer that saw the rates plummet due to intense competituion within the five operators.
However it was by no means the honeymoon for the parent companies because the massive investments in the infrastructures(Building/Fixtures), Networks across a geographically huge country, Human Resource acquistion in a talent scarce market, huge marketing budget costs & of course the license fees to PTA.
I m sure that since now all the initial investments in to the infrastructure has been done and the massive CAPEX expenditure is out of the way the telecom companies honeymoon period will start now.