According to GSMA, the global body for GSM mobile operators, one in five mobile broadband connections will be 4G/LTE by 2017. CREATIVE COMMONS
Finally, with the international consultants in place, the Pakistan Telecommunication Authority (PTA) is moving towards spectrum auction for wireless broadband networks.
As an ICT professional, I am often confronted with the question whether it is a good thing that Pakistan is pressing ahead with spectrum auction in the 1900-2100 MHz (megahertz) band, that is predominantly used for 3G (therefore, is also called ‘3G spectrum’), despite the fact that 4G is now being rolled out in many countries?
Mostly the question comes from those who are not too much into communications technology, but then even some of my “technologically literate” friends wonder about it. Before I venture to attempt an answer to the question let us look at the situation on the ground.
For 4G
Asking for 4G is actually justified. 4G already covers 20% of the global population and is projected to cover half the world by 2017. There will be nearly a billion 4G connections by then. According to GSMA, the global body for GSM mobile operators, one in five mobile broadband connections will be 4G/LTE by that year, leaping from about 176 million at this point in time, as the number of networks doubles to 465 across 128 countries.
4G offers higher speeds and capacities, which will be desperately needed not only by us humans, but also by our machines, as they start talking to each other more and more.
It does not stop here, the European Commission is co-funding development of 5G (700 million euros over the next seven years), and countries like South Korea are announcing that 5G would be deployed latest by 2020. Should we still be inviting investors to invest in the spectrum that is mainly used for 3G?
And now the other side of the coin.
How many have 4G enabled devices? Be it cellphones, tablets, phablets, laptops and/or dongles for PCs – we don’t have them. On the other hand, everyone with a smartphone today (roughly 10% of us) is equipped for 3G, meaning that as soon as the infrastructure is rolled out we will be able to start using 3G.
Infrastructure
Look at the infrastructure side. Those who work in ICT space, know that almost all cellphone operators in the country have upgraded their installed equipment to make it “3G-ready”. This is partly because in the last three to four years, governments have been announcing 3G spectrum auctions.
I don’t mean to advocate an older technology just because the operators have readied themselves for it, it is for the benefit of ordinary users. It is due to this readiness that 3G services can be launched in relatively much shorter time, after the spectrum allocation is done by the government.
Then it’s the frequency spectrum that is available right now, and that too for three operators (a minimum number to ensure competition). Most of the nearly 2 billion 3G subscribers in the world today use this 1900-2100 frequency band. Therefore, due to the economies of scale reached in 3G devices and equipment, 3G comes out to be much cheaper for the ultimate users (the masses).
In other words, not only 3G is available immediately, it is also going to be cheaper for the users.
Wisely, the government decided to keep the spectrum auction “technology neutral”, which means the operators can roll out whatever technology (3G or 4G) that they feel would make the most business sense. The government is not calling it “3G spectrum”, rather “next generation wireless technology spectrum”.
But in reality, trying to go for 4G in the offered frequency band (1900-2100) would be more expensive as the economies of scale of this band in case of 4G/LTE are not there. Therefore, the broadband penetration on a larger scale with 4G alone in this band would be extremely difficult to achieve anytime soon.
In any case this band is used all over the world predominantly for 3G, which means, technology neutral or not, the investors would most likely go for 3G (most probably evolved 3G/HSPA)!
Left behind
However, the fact that we have been left far behind others, who are going for 4G/5G, is too critical to be ignored. There are two more factors that are difficult to ignore for the government – the PML-N manifesto promises 4G, and the great desire of the finance minister, who heads the auction committee, to generate more funds from this auction.
Thus, there are compelling reasons in favour of both technologies. In my opinion, for these seemingly contradictory targets, there is a solution. And that is that together with 3G spectrum, the government should also auction whatever ‘4G spectrum’ that can be made available in this short time!
This will not only be in line with today’s global trend to auction spectrum in multiple bands at the same time, but also that the end-result will be “best of both the worlds”. On one side, wireless broadband will become available immediately and cheaply through 3G, and on the other side, actual groundwork will begin for 4G!
The writer is a former CEO of Universal Services Fund, Ministry of IT and is currently working as ICT consultant in many countries
Published in The Express Tribune, December 30th, 2013.
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Nauman, thanks, we have brilliant brains in Pakistan, only that they hesitate to express their views openly! faisal, I agree with you that deploying 3G does not mean dismantling 2G. 2G should continue for the foreseeable future. But I don't agree to skip 3G altogether, because (using the same argument) Pakistan is already very late. If we decide to go only for 4G today, Broadband in Pakistan will be thrown back by at least another year. This is due to factors like LTE imports/deployments by operators/vendors will take time, some re-farming of 4G-spectrum will have to be done and government's bureaucratic procedures will take their own time etc. etc. On the other hand, all is ready for 3G, which can be deployed (and brought to use) much faster. That is why I say that we should let 3G roll out immediately and allocate "whatever 4G spectrum is available" so that operators/vendors start working on it. More 4G spectrum may be auctioned later after re-farming etc. As for "gold spectrum", well PTA has already hired international consultants (Value Partners) and they will be advising them. As a Pakistani, I just lament the old Instaphone's 850 band that has been lying vacant for far too long already:(
@Nauman, deploying 3G would not mean dismantling 2G. 3G can not give you the voice quality that 2G can give. .Nor can 4G, as you mentioned. 2G will stay , at least for the foreseeable future Operators have already invested in 2G. Voice over LTE is still being tested by operators but depolying voice over an otherwise IP network needs very strict requirements on the packet trasnport, QoS, delay and delay variations.
I am working with a Mobile Operator so I am talking this out of my experience working with all these technologies.
We are talking abour broadband. 4G is the answer. Pakistan is already very late with 3G and with 3G it can not compete with the DSL technogies. Already 4G has been deployed extensively so the technology is quite mature.The point would be to bring something better and competing with the wired technolgies....so I am for 4G, skipping the 3G altogather.
Parvez Sb - Great article, wonderful debate and provoking thought process. Happy to see such amazing discussions happening in Pakistan....In my opinion - any operator will have to deploy HSPA / 3G in phase 1 as "Voice" (which I assume is well over 95% of revenue in Pakistan) doesn't work on 4G/LTE unless you deploy VOLTE (which is still very nascent technology) and IMS architecture (voice falls back to UMTS in 3G)....bottom line, just deploying 4G/LTE will not be able to cover voice so it has to be done in phases...You will also find that there is something called 3.5G (DC -HSPA which is Dual cell and takes HSPA 21MBPS to 42 MBPS)....Wrt specturm auction, I like your suggestion of auctioning both 3G and 4G and let operators decide what to deploy in which phase...what I would suggest (for govt to milk max.) is not to auction "gold" spectrum typically 700 / 800 in first go - that can wait for a year or two (still within Govt's 5 year window)...several countries have deployed this strategy to shore up the smartphone penetration and applications that run on it (which are data hungry) and then and only then auction the gold spectrum.....we can discuss more as I plan to be in Pakistan in end Feb...i know consultants here in Toronto who are advising Canadian and US Govt's on boradband and specturm allocations....it is great debate here as well....
faisal, You are right that it is time for 4G. But 3G only makes sense because it can be deployed relatively quickly and cheaply. If 4G spectrum is also given away at this time (as I have suggested in my Article), it will be up and running and competing with 3G in a year's time - at least in major cities.
Shahid Haq, I fully agree with you and this is the only apprehension/risk which I could think of - that asking the government to do anything more might delay the process. But having seen the Policy Directive of the government, which allows a lot of issues to be done/decided by the consultant, and the fact that the consultant has yet to start the work (next week probably), I feel that some additional frequency spectrum (whatever is readily available) can easily be added, without delaying anything.
Wakeup guys, we are talking about LTE-Advanced and already running 4G since two years here in Saudi Arabia. Its quite mature already. I wonder if 3G really makes sense in Pakistan. Better would be to go directly to 4G.
Good and balanced article which gives the pros and cons from a technology and commercial perspective. The advice is appropriate. My feeling is that the government believes that doing 4G separately might get them additional money later. My worry is that asking the government to do anything more now might delay the already very delayed process. So let them go ahead with whatever they can soon and leave it to the operators to do what they can with the "technology neutral" licence.
Fawad Niazi, Excellent! Could you please share your research - if it is not confidential or proprietary?
My Research in April-May 2012 on peoples intentions to adopt latest technology (3G/4G Adoption Prospects): Eager to buy at any cost: 29%; Will Consider when available: 51%; Will never buy Expensive 3G SIM: 7%; No Idea: 13%
So we may say that Yes! there are prospects of 3G/4G ... For operators its getting spectrum or doomed to be another Instaphone and for user, its always attractive to go mobile especially for young ones who do not have to pay rather parents have to pay for that.
Some more replies: Junaid Qureshi, thanks. Even Afghanistan has 3G, but done be despondent. Things will improve. We all have to do our respective jobs properly and honestly. That's all. Iftikhar Shah Gilani, This is how it works all across the world! Don't forget, today 2G Cellphones are helping many people earn their living. No longer are skilled workers (like plumbers, painters, electricians) dependent on shops. Now-a-days they do their own business just using cellphones. And thousands are earning with the help of fixed-broadband (eg: working in call-centers, doing remote transcriptions, developing apps for Android/Apple, etc.) Similarly 3G and 4G will help people generate incomes no one has even thought before!
Great comments. Brief replies: Khan, nothing wrong with 3G. I'm just saying that if govt. allocates spectrum for 4G NOW, it will take some time for it to be launched and devices to proliferate. Therefore govt. should allocate both at this time so that people may start with 3G immediately and may move to 4G as it becomes available. Umar, believe me no company will launch if its commercially unviable. So no worries on that account! Usman786, 4G is now tested and reliable. Even Rwanda and Kiribati are rolling it out! Ali, I agree, it should be decided by the operators. But the spectrum being offered now is mainly used for 3G all over the world. I am saying let us put some more spectrum also on the table that is mainly used for 4G all over the world. fammw, You are spot on! Tariq Ehsan, you are right, except that I think that the additional spectrum should be offered not in 2.1 GHz band but other bands that are typically used for 4G (like: 800, 1800, 2600, etc.). So that we have 3G as well as 4G! Some more replies follow...
It is good and technically informative article but we we see in our poplulation than it looks like people dont have for eating but he has a cable in home mobile in his hands too. Our Government and as well as investors have done efforst to invest in IT only instead of basic needs of the people like purifing water, electricity and gas etc., At present most of the mobile operators offers free SIM with some balance or SIM for Rs.100 with Rs.50 balance. where as we get check the prices of vegeatables, meats and flour. we can get China mobile with all the world class features in it.
I know our country have bigger problems but 3G is also very important, we have been reading these news since long but its kind of hopeless, people are hungry and without basic utilities and we are talking about 3G sounds off the topic, but reality is we need 3G besides all other things, i was dishearted when Bengladesh rolledout 3G some months back, we use to claim so many things in so many ways that we are better than bengladesh and india, but reality is we are getting far far behind them in every race, we use to give example that "takay ke amdanee nahee" but reality is our Pakistanis are working in BD for the same taka which we never accounted, i dont know when this all will finish, im really getting hopeless with these political parties, they promises alot without having any plans of executions. I hope we will get this 3G auction done and get it working by March 2014 as per plan. Sorry dear writer i forgot to mention its a good artical to read.
no arguments guys, 4G is the latest we get it, if no one has yet got the 4G mobile devices they will have later on, no problems, go forward in spite of looking into past. end of discussion PERIOD
I think govt should auction more then 30Mhz in 2.1G. The 4G device eco system is mature as NTT Docomo and some other operators are using it. More spectrum on 2.1G will give investors more option play with but govt might lose money. The operators can launch more services if have more spectrum and overall ICT industry will flourish in Pakistan. 3G in Pakistan is a must or we can say base network will be 3G as in most of the country. If we see the user behavior of users in Pakistan skipping 3G doesn't look like an option.
@umar: Smart phone prices are falling and very soon we will only have smart phones. Feature phones will be a thing of the past. Everyone, regardless of income, will be buying smart phones.
Saying that companies won't be able to afford the investment and that the market is too small are not arguments we should be making. Those decisions rest with the companies themselves. We need the government to get out of the way and let the companies decide for themselves whether 4G is worth it or not. The government can get out of the way by a) not charging for 4G licenses b) issuing said licenses as quickly as possible. Frankly I think it is quite crazy how a government can leech money by licensing radio spectrum. Is even air something that has to be sold? How greedy can you get!
If the Govt. wants to make more money, which they do, they will keep separate auctions for 3G and 4G. Or the Govt. an auction a broader spectrum and have the telecom operators decide which one to use. I think the argument that we do not have 4G devices is correct however, there will be 4G devices in people's hands in no time if the operators start offering 4G. I have no doubts in my mind about that. A well written article.
Make money now by selling 3g. Even African s have it. Auction 4g later when technology is tested and reliable and get money again
A well informed article. I think the biggest issue in Pakistan is the commercial viability of launching 4G vis-a-vis 3G. With a low smartphone penetration rate, investment in 4G will be an absolute waste. Smartphone penetration primarily depends on increase in per-capita income. Other factors also play a role such as literacy. However, without the increase in disposable income, the growth in smartphone penetration will remain modest. The economic prospects of the company still remain bleak due to the ongoing energy crisis and security situation. In a nutshell, launching 3G is the best option for Pakistan.
Too critical article. Most countries are using 3G even in the UK. As for LTE most of us would use it for wireless modems for home broadband and for those with LTE enabled devices of which many Pakistanis have by the way.