Internet outages cost e-businesses 30% revenue

IT professionals are calling on the government to audit and upgrade Pakistan's national internet infrastructure, as persistent internet outages and load-shedding have led to a reported revenue loss of up to 30% for e-businesses over the past few months.

Dr Noman Said, CEO of SI Global Solutions, highlighted the severe impact of these disruptions on e-commerce platforms. "Internet outages drastically affect e-commerce operations, causing significant drops in transaction volumes and delivery operations. For instance, platforms like Daraz and foodpanda depend on uninterrupted internet access to process orders and engage with customers. According to a study by the Global System for Mobile Communications Association (GSMA), digital platforms in Pakistan lost up to 25% of their revenue during major internet disruptions. The banking sector, including online bill payments, is also affected, leading to delays and eroding consumer trust," said Dr Said.

Since issues related to firewall installation began, the Pakistan Software Houses Association (P@SHA) reports that e-businesses have experienced revenue losses of up to 30%. Major platforms such as Bykea and inDrive have seen a significant decline in the number of rides booked and processed, with service delays due to slower network speeds. These losses have forced many small and medium-sized enterprises (SMEs) in the tech sector to scale back operations, stifling growth.

Dr Said emphasised that the government must audit and upgrade the national internet infrastructure, focusing on increasing bandwidth capacity. "Implementing redundant data routes could mitigate disruptions caused by maintenance or faults. Public-private partnerships could help deploy faster, more resilient networks. Policymakers should also enforce strict Service Level Agreements (SLAs) for Internet Service Providers (ISPs), ensuring minimum guaranteed speeds for businesses and penalising non-compliance. Additionally, the cybersecurity policy regarding firewall installation should be revised to reduce unnecessary slowdowns while maintaining security," he added.

The growth of digital platforms has democratised income generation, giving rise to a new class of digital entrepreneurs. Spending habits have also evolved, with apps like foodpanda's pandamart and HomeChefs making grocery shopping and meal ordering more convenient. Online shopping has become a daily activity for many, with platforms like Daraz and other local e-businesses allowing consumers to purchase everything from clothes to electronics from the comfort of their homes.

However, frequent internet outages are undermining these advances. Wahaj Ahmed, a regular user of online services, expressed his frustration, "Frequent internet outages have caused a myriad of connectivity problems. I can no longer book ride-hailing services like inDrive, and online services like foodpanda have become unreliable. Even online transactions and utility bill payments through banking apps are becoming problematic. These outages have created an atmosphere of unreliability. While people want to save time and leverage online services, these disruptions make it nearly impossible."