PM approves auction of one block of 10 MHz spectrum

ISLAMABAD: Prime Minister Nawaz Sharif has approved auction for remaining spectrum for allocation of one block of 10 MHz paired spectrum in 850 MHz band with base price of $395 million.

According to announcement made by Ministry of Information Technology here on Tuesday, stating that in pursuance of the policy framework finalised by the Advisory Committee for auction of frequency spectrum left unsold in the Next Generation Mobile service (NGMS) auction 2014 and subsequent approval from the prime minister, Ministry of Information Technology & Telecommunications issued Policy Directive to PTA (Pakistan Telecommunication Authority) for conducting transparent and competitive auction for allocation of one block of 10 MHz paired spectrum in 850 MHz band. Base price of the block on offer has been set at US$395 million after thorough analysis and based on the market demand study of the PTA and international technology and market benchmarking.

Due to rapid growth and escalating demand of mobile broadband services requirement of more frequency spectrum, which is a critical input for high quality mobile broadband services, was foreseen. It is pertinent to mention that the penetration of mobile broadband services have quickly grown from a paltry figure of less than 3% in 2014 to more than 17% in the wake of successful and transparent spectrum auction of 2014. Keeping in view the future demand of the industry in terms of frequency spectrum an Advisory Committee, under the chairpersonship of Minister of State for IT, was constituted by the prime minister of Pakistan to analyse the market situation and recommend a way forward. 

The Advisory Committee convened four meetings and deliberated extensively on different options and market scenarios. In its 4th meeting, the Advisory Committee finalised its recommendations for approval of the prime minister.

In the policy directive, PTA has been directed to design the auction process in a manner to fulfill policy objective of optimal outcome while mitigating chances of collusion amongst the bidders. PTA will conduct the auction within this financial year. Payment terms and conditions will remain the same as in 2014 NGMS auction. All existing mobile operators as well as new entrants will be eligible to participate in the auction. New license for provision of NGMS services will be issued to successful bidder for a period of 15 years. Provisions of Telecommunication Policy 2015 related to sharing of infrastructure and national roaming will be applicable.

It is expected that the current move by the government to supply the market with critical commodity of frequency spectrum will prove to be an important milestone in enabling mobile industry to aggressively expand their networks to each and every nook of the country while maintaining international quality of service standards for Pakistani users and digital economy of the country.