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April 13, 2019

Connecting rural Pakistan

Opinion

April 13, 2019

The telecom landscape of the world, Pakistan in particular, is evolving rapidly. In Pakistan, the rise in mobile telecom usage has defied odds and bypassed cultural and social taboos.

Tele-density, or the penetration of telecom facilities per 100 households, is currently at over a landmark 70 percent, with some of the lowest calling rates in the world, due mostly due to the price wars between the major telecoms which have resulted in the consumer being the ultimate beneficiary. The Pakistan Telecommunication Authority (PTA) expects there to be 47 million mobile-phone users by 2020, and 70 million by 2025. The overall number of broadband users is expected to grow exponentially as well.

Our prime minister has recently reiterated his intent to provide telecom services to all the far-flung regions of the country. The GoP’s Telecom Policy was revised in 2015, based on the belief that although significant proliferation of telecom infrastructure through fixed, mobile and nationwide backhaul fibre connectivity had been achieved, Pakistan still faced challenges in terms of diffusion of ICT services. Implementing connectivity in these regions is a commendable priority of the current regime, but this effort will require proactive and aggressive policies to achieve its goals.

The government is currently collecting 1.5 percent of telecom revenues from operators under the Universal Service Fund (USF) for promotion of services in underserved areas of Pakistan. The licensing regime of the PTA includes a mandatory roll-out obligation plan to ensure deployment of networks and services in an optimal way at a nationwide level. This is an excellent initiative and the projects already implemented by the USF include the Rural Telecom Programs for establishment of 2G, 3G, 4G networks to provide basic telephony and data services to population in unserved areas and tele-centers established by the PTA which offer computer equipment and broadband facility.

However, telecommunications, despite being part of the USF agenda, has not seen the requisite success, and remote areas have not benefited as they do not qualify for coverage purely on commercial or business basis. The different lots which have been auctioned have not been developed into their true potential. Furthermore, these operators are in dire need of security guarantees for their mega investments. Unfortunately, in our remote areas where these initiatives will have the most impact in transforming lives, the law and order situation is very fragile. Here, the government must use special initiatives to provide mobile operators with sufficient security; field staff safety should be a primary concern.

Entrepreneurship, trade and development of a multitude of skill sets are vital traits for uplifting the economy. In today’s connected world, these areas can be honed by using the USF platform to implement comprehensive governmental policies and providing an infrastructure of robust mobile networks. This will lay the foundation for social peace, stability, a steady law and order situation, access to health and education – all critical factors that could transform these rural areas into the oasis of their provinces.

Both operators and regulators must forge new industry practices in order to attain their objectives. The industry structure should be rationalized and return on investment must be assessed objectively by the government, with operators’ assistance. New operating models, such as community networks, can be established locally and operated by local communities, with the support of mobile operators. Voice over IP (VOIP) and other such technologies should be deployed, and the government endeavour should be to make voice calls free of any charges so effective communication within the communities can become an affordable reality.

It is the government’s responsibility to provide these remote areas with electricity and access to fuel so mobile and fixed networks can be operated efficiently. The government must start a comprehensive campaign for provision of efficient data networks in remote regions. Other models could include slashing the cost of deploying base stations by 50 percent or more, innovating in distribution and recharging practices, and seeking more individualized pricing models, ideally delivered directly to customers rather than through advertising. They must also consider the rapid proliferation of 5G worldwide, which will make 3G technology obsolete, and hence should be incorporated into the USF’s implementation agenda.

Policymakers can also help drive the data market by making lower-spectrum bands available at reasonable rates, promoting infrastructure sharing, providing rollout incentives, and, potentially, reducing rural license fees. To capture this opportunity, operators must adapt their operating models – for instance, by developing low-cost off-peak packages, scaling up compelling applications, and making data-enabled handsets available more cheaply, as they are currently unaffordable due to high taxation. Some of these initiatives have already been launched. However, they lack synergy and cohesion among the different stakeholders and have failed to make any significant impact.

Experience in other countries suggests that a 10 percent increase in broadband penetration translates into additional GDP growth of some 0.5 to 1.5 percent. Social welfare improves as well; applications such as mobile healthcare will provide significant benefits, helping governments to stretch thin resources further. Studies in other developing markets indicate that 80 percent of healthcare issues can be resolved by a mobile phone, at a cost per capita that is 90 percent lower than that of traditional health care models.

Prime Minister Imran Khan’s ambitious anti-poverty Ehsaas initiative can incorporate telecom as a powerful tool in poverty alleviation. This may include development of skills and availability of microloans, using technology, to help impoverished people start their own businesses. The initiative of e-education needs to be established by synchronizing telecoms, developing and utilizing new, emerging software apps, along with provision of subsidized or free tablets.

Governmental federal and provincial policies need to be set in place in order to provide our young generation with equal access to education. Adult education programmes can be introduced which could help the uneducated in reshaping their lives. At the heart of all these endeavours, of course, is unfettered access to mobile networks; data and fibre must be put in place to transform these vital areas of our nation.

The writer is former deputy CEO, ZONG, as well as a top business strategist and management consultant.

Email: [email protected]

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