Once again the Pakistan Telecommunication Authority (PTA) is hinted to launch 3G technology in country when the world has moved to 4G. The Chairman PTA Muhammad Yaseen in a seminar had stated to launch the 3G in short time. He made this announcement when the country economy had caught by inflation and recession and ARPUs of cellular industry had drastically down. The PTA officials are saying that the Authority is ready to auction 3G spectrum in the next three to four months – ignoring the fact that the 4G is the technology arrived in world while the operators are also not ready to get the spectrum while paying huge license fee in recession. Speaking at a conference, Chairman PTA, turn down reports that the country’s operators are not pushing for the rollout of 3G services, stating that there are “certain operators” supporting the regulator in its plans. The Pakistan government has previously pointed to the success of India’s 3G auctions as evidence of the “bullish mood of investors” in the region’s telecoms industry. But factually the Telenor who purchase 3G license in India is also in financial trouble. The whole idea of launching 3G was mainly to increase the foreign direct investment numbers in country to provide an opportunity to PPP led government, during its tenure the FDI had drastically dipped in Pakistan. Mobilink – Market leader of Pakistan cellular industry is the main opponent of the 3G while asking the PTA to auction 4G instead 3G. On the other hand the Zong – new Chinese infant of Pakistani cellular industry is the big supporter of 3G – ignoring that its relations with the government as it had failed to get LDI license so far – despite the issue was taken at President of Pakistan and diplomat levels as well. Muhammad Yaseen also said that value-added services will also need to be created rapidly, to appeal to subscribers in Pakistan and “promote business at a local level,”. Operator Zong – owned by China Mobile – is apparently offering developers a 60/40 revenue share to provide 3G content, while Mobilink is more generous with a 70/30 split. While the PTA will offer the existing operators 3G spectrum, they will not be obliged to launch services, and it said that while “it is the right time for the industry to go for 3G, it could not be done hastily.” It was also suggested that the licenses will be technology-neutral, enabling operators to select the network technology of their choice. The Pakistan mobile market grew by 6 percent year-on-year in the first quarter, according to the latest Wireless Intelligence data, a return to growth from a year ago when the market suffered a slow down due to tax increases and the after-effects of the global recession. Total connections in the country – the world’s tenth largest mobile market – hit 96.9 million in 1Q10 and should surpass the 100 million mark by year-end. The PTA whole idea of launching 3G is to get some FDI for government from this spectrum and in future a hefty amount from 4G spectrum as well. The country’s five main mobile operators – which are largely controlled by international players – look better placed to fund 3G rollout than a year ago. However, despite a mobile penetration of just 54 percent, the market is fiercely competitive and operator ARPUs are among the lowest in the world. At Orascom’s Mobilink, which controls a third of the market, first quarter ARPU was just US$2.8, falling from US$3 a year ago, though this is still among the highest in the market. It did, however, improve its EBITDA margin by 3.1 percentage points to 38.9 percent over the same period. Mobilink’s revenue and earnings (EBITDA) in local currency terms rose by 10 percent and 20 percent, respectively, year-on-year in the quarter as market conditions improved. Second placed Telenor was the best performing operator in the quarter in terms of connections, just surpassing Mobilink in terms of quarterly net additions and recording the highest year-on-year connections growth (16 percent). However, the unit continued to make an operating loss for its Norwegian parent, posting a NOK9 million (US$1.4 million) loss for the quarter compared to a NOK90 million loss a year ago. Telenor’s monthly ARPU in the quarter was US$2.3. Third-placed Ufone is a wholly-owned subsidiary of local state-owned fixed-line incumbent PTCL, which in turn is 26 percent-owned by UAE-based operator, Etisalat. However, an ongoing dispute between the two owners has put the operator’s future at risk. Etisalat bought its stake in the firm – and assumed management control – for US$2.6 billion four years ago, but it is currently withholding a portion of the fee claiming the government has broken the terms of the contract regarding property assets. Ufone saw its connections base drop 4 percent year-on-year in the first quarter. Warid Telecom saw the operator’s connections base shrink 6 percent year-on-year in 1Q10 as it reined in operating expenditure. Singapore’s SingTel – a 30 percent shareholder – said its share of pre-tax operating losses at Warid declined 19 percent in local currency terms in the quarter, while operating revenue was up 7 percent and operating expenses declined 14 percent due to the cost management measures. Warid also deactivated 2.7 million subscribers in the quarter, which saw its connections base decline by 2.6 million from the previous quarter. Fifth-placed Zong is China Mobile’s first – and, to date, only – venture outside its domestic market. Launched in 2008 following China Mobile Communications Corporation’s (CMCC) acquisition of Paktel the previous year, the Chinese firm has invested over US$1.6 billion over the last few years building-out and marketing the network. However, it has admitted that it faces a long wait for its return on investment. Zong grew its connections base by 13 percent year-on-year in 1Q10 but commands only a 7 percent market share. A sixth operator – Pakcom (Instaphone) – was shut down last year for non-payment of license fees.