3G spectrum licenses auction concludes:Live Updates

[my2cents]

I don't understand why everyone is so fixated on the short term money this brings in. Faster mobile internet at reasonable costs will bring about tremendous benefits to the people and economy. Smart phones are getting cheaper by the day, eventually everyone will be able to afford one. Small time mobile app companies will spring out of nowhere providing much needed services. Restaurant bookings, route navigation, news alerts, e-government services, and so much more

Looks like Pakistan has adopted Indian example by auctioning both 3G and 4G spectrum together. We also kept our base price very low in order to encourage many telecom players to get involved. The idea was to upgrade to modern technology because the benefits are enormous. So, it was not all about money but early adoption of technology.

If I recall most of our bids were just above the base price. Our telecom operators planned beforehand not to bid each other out and decided to opt for different cities instead. Only Delhi and Mumbai got multiple bids. Because of lower spectrum costs, they are able to offer their services real cheap and to wider number of people.

Because of penetration of smart phones more number of people are able to access the Internet. Mobile data usage has doubled and the revenue of telecom operators has also doubled.

Here are few highlights....
- India has more internet traffic coming from mobile phones than desktop computer.

India has 39 million 3G subscriptions as of Q4 2011 with 4% penetration rate.

- India now has 121 million Internet users with a population penetration rate of 10%.

 

[forcetrip]

I give it to the government for this one. They had a technically fair auction. They didnt go ballistic after learning they wont be making their $5b. Ishaq Dar didnt go Sultan Rahi after the 7th round and tear down the posters and say, the auction is off, everyone get the duck out.

 

[my2cents]

I give it to the government for this one. They had a technically fair auction. They didnt go ballistic after learning they wont be making their $5b. Ishaq Dar didnt go Sultan Rahi after the 7th round and tear down the posters and say, the auction is off, everyone get the duck out.

I am actually happy to see that Pakistan did not do the same mistake we did initially and kept the auction transparent. Lot of heads actually rolled in our initial auction which was not transparent. Our telecom minister A.Raja even went to jail for his role in that scandal.

In Indian context our average revenue per user(ARPU) is Rs111 and for 3G is around Rs 200 which is quite low by western countries. So, expecting $5B in Pakistani context for such low ARPU is unreasonable. I am assuming that both our markets are similar.

 

[khanboy007]

So Pakistan raised US$1.1-1.2 billion from this auction.
BTW just for some info:India raised US$ 18 billion during spectrum auction in 2010 & US$10 billion during spectrum auction in 2014.

we should also consider the customer base; india is the worlds second most populous country mean while Pakistan is 6th most populous

india: 1,243,170,000 people
Pakistan: 186,252,000 people

you guys are in billions we are in millions; see the difference ;so the comparison is not applicable here

 

[Evil Flare]

So Pakistan raised US$1.1-1.2 billion from this auction.
BTW just for some info:India raised US$ 18 billion during spectrum auction in 2010 & US$10 billion during spectrum auction in 2014.

India has ten times more population than us .....

 

[dawn_news]

Unsold licences will be sold later? Maybe in couple of years someone else will buy?

 

[farhan_9909]

So if the 2nd 4g license is sold in the coming months to either Ufone or Mobilink,It will also fetch atleast 200Million more,hence beating the target of 1.3billion dollars.

Anyway hats off to the govt for making it possible otherwise if we had honest govt in the past,we would had this auction in 2010-11

Unsold licences will be sold later? Maybe in couple of years someone else will buy?

Yes and even at base price,It will cross the target of 1.3Billion dollars

Talking to media after the auction, Finance Minister Ishaq Dar said that the remaining licence in the 1800 MHz band and one license reserved for new entrants will be sold in the coming months, which would fetch additional income.

If sold, the total money raised from the spectrum auction will cross the expected revenue target of $1.3 billion.

 

[dawn_news]

I give it to the government for this one. They had a technically fair auction. They didnt go ballistic after learning they wont be making their $5b. Ishaq Dar didnt go Sultan Rahi after the 7th round and tear down the posters and say, the auction is off, everyone get the duck out.

I don't know who came up with $5b figure. Bangladesh with almost similar population raised $525 million last year.

So if the 2nd 4g license is sold in the coming months to either Ufone or Mobilink,It will also fetch atleast 200Million more,hence beating the target of 1.3billion dollars.

Anyway hats off to the govt for making it possible otherwise if we had honest govt in the past,we would had this auction in 2010-11




Yes and even at base price,It will cross the target of 1.3Billion dollars

Ok good news, i though maybe in couple of years. If it gets sold in coming months then great!

 

[Hyde]

I don't usually make hypothetical posts but please bear my positive thinking about the whole project. I think we would have gained a lot more if our economy was slightly better than where we are and also if we were not war-torn country.

I foresee major boom in the telecommunication industry once again since the mobile networks have got this deal so cheap in my opinion. It's a win-win situation for all.. The Public, Mobile Networks and the Government. I know they are not going to offer what I am proposing below but this is very much possible

In UK, we usually have 12, 18 or 24 months contracts on mobile networks. Imagine if Zong offers a 12 month contract to it's users for fixed price of 10,000 rupees per year divided in 12 parts/monthly and offer free minutes such as 1000 minutes any time any network similar to what we get in UK. I won't be surprised if at least 5 million people go to buy postpaid contracts just to get the fastest internet on earth.

What we are seeing is...

5 million subscribers x 10,000 rupees per year = 50 billion rupees per year
50 billion rupees x 15 = 750 billion rupees in 15 years
750 billion / 100 = 7.5 billion dollars

and how much are they paying? about 300 million dollars for 3g connection and 220 million dollars for 4g. That is about 550 million dollars for Zong I think. On top of that, they can charge customers for extra minutes and other packages, they will obviously be employing hundreds of thousands of people to do this job, so wages and everything else will deduct major chunk of it.

But in the end, it's still a big net saving for Zong and the Government would be happy that about 900,000 jobs are expected to be created by this deal. So The government is going to receive extra money from 900,000 people when they pay taxes, taxes for the mobile network companies, users (they charge unfairly), and licence fee. That also means chance of higher growth rate in the GDP and positive indicators in the following years.

 

[Peaceful Civilian]

Very Far from target. Last month thickhead IT minister Anusha rehman was expecting 4-5 billion dollar from this auction, despite she knows that YouTube and other sites are banned . Even months ago she was talking about banning Google...
Thickhead extremist minister.

Anyway, congrats for 4G.... Well done Zong...

 

[Hyde]

Very Far from target. Last month thickhead IT minister Anusha rehman was expecting 4-5 billion dollar from this auction, despite she knows that YouTube and other sites are banned . Even months ago she was talking about banning Google...
Thickhead extremist minister.

Anyway, congrats for 4G.... Well done Zong...

Even ban of YouTube may have made a difference...

The companies may have thought, who knows if they would be banning YouTube or another popular website in future and they may incur financial losses due to this reason. We need to regulate everything but not ban anything.

 

[forcetrip]

Even ban of YouTube may have made a difference...

The companies may have thought, who knows if they would be banning YouTube or another popular website in future and they may incur financial losses due to this reason. We need to regulate everything but not ban anything.

We got 1b because of guarantees that youtube will be opened and emotional things like that will not happen. Less data that is transferred by consumers less money that can be charged. In a nutshell youtube will be back on before 3g services go live. It feels like common business sense.

For the rs10000 package a year we just have to get back to reality and see what % of users actually make financial decisions like that. I can tell you even though the majority of cell phones users in Pakistan accumulate bill way more than 10000rs with less minutes they will still opt to do it rs100 at a time. Thats just the mentality of the populace and it wont be changing for a long time coming.

 

[Hyde]

For the rs10000 package a year we just have to get back to reality and see what % of users actually make financial decisions like that. I can tell you even though the majority of cell phones users in Pakistan accumulate bill way more than 10000rs with less minutes they will still opt to do it rs100 at a time. Thats just the mentality of the populace and it wont be changing for a long time coming.

I know but general awareness will be helpful.

I remember when i was Pakistan in the first 2 weeks I had used about 4000 rupees of balance for making phone calls and using internet all the time. Later I used to subscribe to weekly Internet package for 35 rupees (Mobilink Jazz). After a month, 100 rupees of calling card per week was minimum.

I think 10,000 sounds really big amount but see it's just 833 rupees per month.. My cousins all pay way more than that on postpaid contracts. So I believe even 1000 rupees per month won't hurt businessmen when they knows they will be getting free internet and free minutes. They might be thinking oh we can access youtube anytime even when we are outside sitting on the road. I foresee the era of expensive phones finally coming to Pakistan.

Imagine you own iPhone 5s, you wouldn't want to have 2g connection on it and will be willing to spend another 10,000 rupees per year when you have already invested 60,000-80,000 rupees to purchase an iPhone.

 

[SHAMK9]

 

[Hyde]

We congratulate Zong, Telenor, Ufone and Mobilink for having aquired 3G network

Zong is likely to be my new network when I travel to Pakistan for having aquired 4G rights. Zong has proven to be the most loyal and committed in the Pakistani telecommunication industry

They envision future with us so we must standby them.