PTA to auction 3G/4G licence for $395m

Regulator to complete task before end of current fiscal year on June 30 in a bid to overcome revenue shortfall

KARACHI: The government has tasked the Pakistan Telecommunication Authority (PTA) with auctioning a 3G/4G mobile broadband licence at a higher base price of $395 million before the end of current fiscal year on June 30 in an apparent bid to overcome the revenue shortfall.

“The auction shall… be conducted by the PTA in the minimum possible time after the issuance of this directive within financial year 2015-16,” said a notification.



All existing cellular mobile operators (CMOs) as well as new players will be eligible to participate in the auction. The spectrum assignment will be technology neutral and usable for all next generation mobile services.

The tenure of frequency assignment will be 15 years, the PTA said in the notification.

“For efficient and optimal rollout of next generation mobile services, provisions for sharing of infrastructure and national roaming as provided in the Telecommunications Policy 2015 will be applicable,” the authority stated.

The government has apparently increased its base price for the new licence to overcome the revenue shortfall of about Rs85 billion. In case, the PTA fails to auction the licence at the desired price, the government may opt to cut the development budget to keep the deficit at the level agreed with the International Monetary Fund under the Extended Fund Facility of $6.64 billion.

Last year too, the PTA had put the 3G/4G licence on sale, but rejected all the bids after finding the offers below the desired level. Two likely new entrants from Saudi Arabia and Turkey had also visited Pakistan in this regard.



In April 2014, the government sold four 3G and one 4G licences for $1.12 billion. In the auction, the base price for the 3G licence was set at $295 million and for 4G licence it was $210 million. PTA said a transparent competitive auction process be launched for allocation of one block of 10 MHz paired spectrum 824-834 (uplink), 869-879 MHz (downlink) in 850 MHz band.

It stated that 3G/4G mobile broadband services launched in April 2014 by the telecom operators have brought Pakistan on a par with the most advanced countries in terms of mobile broadband technologies. The demand for data services has grown exponentially in around two years and the subscriber base of 3G/4G mobile broadband users is close to 31 million and is still on the rise.

“With the rapid growth and escalating demand of mobile broadband services, the requirement of more frequency spectrum is foreseen in the near future.

Published in The Express Tribune, April 28^th, 2016.

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