The 5G tipping point

KARACHI:

Imagine being able to download your favorite movie in seconds, or seamlessly streaming high-definition videos on your mobile device without any buffering. Envision remote healthcare services becoming more accessible and efficient, with doctors able to remotely monitor patients' vital signs and provide timely interventions. Picture a future where smart cities, powered by the Internet of Things (IoT), optimise traffic flow, energy consumption, and waste management, making our urban lives more convenient and sustainable.

The advent of 5G technology promises to revolutionise the way we live, work, and interact with one another. With its lightning-fast speeds, low latency, and massive connectivity, 5G has the potential to unlock unprecedented economic, social, and environmental benefits for Pakistan. From enhancing the quality of education and healthcare to boosting industrial productivity and competitiveness, the possibilities offered by 5G are vast and exciting.

Now, with Pakistan set to launch 5G services in April 2025, the question on everyone's mind is: what does this mean for the country's economy, industry, and citizens? Will 5G be a game-changer for Pakistan's digital landscape, or will it exacerbate existing challenges?

Well, as we stand at the cusp of this technological revolution, Pakistan's journey to 5G adoption is fraught with challenges. Despite the government's ambitious plans to auction 5G spectrum and launch commercial services, the country's telecom sector is grappling with significant hurdles. These range from economic constraints and limited 4G penetration to inadequate infrastructure and a lack of affordable 5G devices. As we explore the prospects of 5G in Pakistan, it's essential to examine the current state of the country's telecom sector, the challenges that lie ahead, and the strategies that can help overcome them.

The Implementation plan

Pakistan's journey to 5G adoption has been underway for several years. In 2019, the PTA conducted 5G trials in collaboration with telecom operators, showcasing the technology's potential in the country. Since then, the government and telecom operators have been working towards a commercial launch.

The Pakistan Telecommunication Authority (PTA) has outlined a comprehensive plan for 5G implementation, which includes the auction of 5G spectrum, the establishment of a regulatory framework, and the development of infrastructure. The authority has also set a target for 5G coverage in major cities, including Karachi, Lahore, and Islamabad.

To facilitate the rollout of 5G services, the government has announced plans to establish a specialised company to oversee the development of a national 5G infrastructure. This company will be responsible for building a robust and reliable 5G network, which will provide high-speed internet access to consumers and businesses across the country.

Telecom operators, including Jazz, Telenor, Zong, and Ufone, have also been preparing for the launch of 5G services. They have been investing heavily in the development of their 5G networks, including the deployment of new cell sites and the upgrade of existing infrastructure.

The implementation of 5G technology is expected to be carried out in phases. The first phase will involve the launch of 5G services in major cities, followed by a gradual rollout to other parts of the country. The PTA has set a target of covering at least 50% of the country's population with 5G services within the first two years of the launch.

PTA timeline

In June 2019, the PTA took a significant step towards introducing 5G technology in the country. The regulatory body issued a "Framework for Test and Development of Future Technologies" aimed at facilitating the testing and trial of 5G technology. This framework provided guidelines for telecom operators to conduct trials and testing of 5G technology, paving the way for its eventual rollout in Pakistan. The move was seen as a positive step towards embracing cutting-edge technology and staying competitive in the global digital landscape.

On August 11, 2023, the Ministry of Information Technology and Telecommunication (MOITT) announced plans to launch 5G services in Pakistan by August 2024. This announcement marked a significant milestone in the country's journey towards adopting 5G technology. The MOITT stated that the government was committed to providing a conducive environment for the rollout of 5G services, which would enable faster data speeds, lower latency, and greater connectivity. The planned launch was expected to boost Pakistan's digital economy, improve healthcare and education services, and enhance the overall quality of life for citizens.

On October 17, 2023, the Federal Cabinet approved the auction of 5G spectrum, a crucial step towards the rollout of 5G services in Pakistan. The cabinet's approval paved the way for the PTA to proceed with the auction process, which was expected to be completed by April 2025. The 5G spectrum auction was anticipated to generate significant revenue for the government and attract investment in the telecom sector. The successful auction and subsequent rollout of 5G services were expected to have a positive impact on Pakistan's economy and digital landscape.

Ten days later, the PTA announced that the 5G rollout in Pakistan would be delayed until April 2025. This revised timeline was attributed to the need for additional time to complete the 5G spectrum auction and ensure the readiness of telecom operators to deploy 5G services. The PTA assured that the delay would not impact the quality of 5G services, and the authority was committed to ensuring a smooth rollout.

On July 15 this year the PTA received 11 expressions of interest (EOIs) from consulting firms for the release of IMT spectrum. This marked a significant step towards the auction of 5G spectrum, which was expected to take place by April 2025. The selected consultant would provide professional analysis and advice to the government on the upcoming spectrum release process, including proposed reforms, spectrum valuation, and auction design.

Then, on August 22 the PTA announced the auction date for 5G spectrum, with the auction expected to take place by April 2025. This significant development marked a crucial milestone in Pakistan's journey towards 5G adoption. The PTA was actively working to attract new players to participate in the 5G auction, with the aim of ensuring competitive pricing and a wider range of services for consumers.

On November 19 the PTA signed a contract with National Economic Research Associates Inc (NERA) for consultancy services on the release of IMT spectrum. The consultant would recommend to the government on the salient features of the upcoming spectrum release process, including proposed reforms, spectrum valuation, and auction design. The process was expected to be completed by April 2025.

Now, by April 2025, the PTA is expected to complete the 5G spectrum auction and rollout of 5G services in Pakistan.

Challenges and concerns

Pakistan's journey to adopting 5G technology is hindered by several challenges. One major issue is the lack of good mobile phones, with the majority of mobile phones in Pakistan only compatible with 2G technology. This limits the adoption of 4G and 5G technologies. At least 60% 4G penetration is necessary before moving to 5G.

According to Muhammad Aslam Hayat, an ICT regulatory expert, Pakistan faces significant challenges in deploying 5G technology. One of the main hurdles is the high cost of spectrum, which is denominated in US dollars and must be paid upfront or within five years with interest. "The high cost of spectrum, which is in USD and has to be paid upfront or within 5 years with interest," Hayat notes, is a significant financial burden for telecom operators.

Another challenge is the low fiber-to-tower ratio, which is currently less than 15%. This inadequate infrastructure can hinder the rollout of 5G services, which require a robust and reliable network. Furthermore, the availability of 5G handsets is also a concern, as the current market penetration of these devices is limited. Hayat emphasises that "the availability of 5G handsets" is a crucial factor in the successful rollout of 5G services.

In addition to these challenges, Hayat notes that there is a lack of use cases for 5G in Pakistan. This means that there is limited understanding of how 5G technology can be applied in various sectors, such as healthcare, education, and finance. "There is a lack of use cases for 5G," Hayat says, highlighting the need for greater awareness and understanding of the benefits and applications of 5G technology.

Another telecom analyst while discussing the challenges said, "The biggest obstacle in the way to launch 5G in Pakistan is the economic conditions of Pakistan," the analyst notes. With approximately 1% of the population having access to 5G-enabled devices, compared to 17% in countries where 5G was launched, the analyst questions the feasibility of introducing 5G in Pakistan.

"Approximately 15% to 20% of the population in Pakistan has no access to any type of telecommunication services," the analyst points out. Furthermore, only 50% of the population has access to 4G services, compared to 80% in countries where 5G was launched. He also emphasised the importance of locally assembled smartphones.

"The numbers are stark," the analyst says. "If 5G is launched with five million consumers in Pakistan, it means that three million 5G devices will have to be imported in Pakistan. And if one 5G device costs $250, it will cost $750 million from the Pakistani treasury to import three million devices." Adding the cost of 5G equipment, the total cost would be $1.7 billion, which is approximately 55% of the $3 billion bailout package between Pakistan and the IMF.

The analyst also cites a report by the World Bank, published in 2021, which states that Pakistan is not ready for the 5G launch. The report suggests that telecom operators should focus on selling spectrum at an appropriate price, ensuring extensive fiber optic backhaul access, and making low-priced 5G devices available in Pakistan.

Similarly, the Global System for Mobile Communications Association (GSMA) emphasised in 2022 that Pakistan is not ready for the 5G launch. GSMA recommended reducing the 15% advance income tax and using Pakistani rupees instead of foreign currency in the auction of spectrum to financially strengthen the telecom sector in Pakistan.

Another challenge facing Pakistan's telecom industry is the widespread use of illegal signal boosters. These devices cause interference and degrade the quality of mobile services. Many cellular and broadband users in Pakistan experience dropped calls, poor internet connectivity, and low data speeds due to these illegal boosters. The PTA has issued warnings and taken actions against the use of these devices, but the problem persists.

The limited penetration of 4G technology is another concern. Even 4G has not reached all areas of the country, with some regions still lacking 3G/4G services. Furthermore, mobile companies in Pakistan are adjusting new connections to old frequencies, leading to congestion and poor service quality. An independent ICT analyst suggested that the PTA and Frequency Allocation Board (FAB) should float frequency spectrums for auction to address this issue.

The impact of these challenges is felt across various sectors, including healthcare and gaming. Healthcare workers in Pakistan face difficulties in providing online consultations and services due to poor internet connectivity. The gaming industry also suffers from slow and unstable internet connections, hindering the growth of this sector. The adoption of 5G technology can potentially address these issues and provide faster, more stable internet connectivity.

The analyst warns that launching 5G technology in Pakistan's current economic circumstances can harm the Pakistani economy. "It's essential to address these challenges and concerns before rolling out 5G services in Pakistan," the analyst emphasises.

However, Hayat also cautions that 5G technology introduces new cybersecurity risks due to its complex architecture, increased connectivity, and integration of diverse technologies. "5G introduces new cybersecurity risks," Hayat warns, "Due to its complex architecture, increased connectivity, and integration of diverse technologies. Key risks associated with 5G include vulnerabilities in IoT devices connected to the 5G network, exploitable vulnerabilities in software-defined networking and network functions virtualisation, enhanced DDoS attacks, and threats to critical infrastructure.”

To mitigate these risks, Hayat recommends typical strategies such as network hardening, zero-trust architecture, real-time threat monitoring with AI-driven tools, and secure IoT devices. "Typical mitigation strategies include network hardening, zero-trust architecture, real-time threat monitoring with AI-driven tools, and secure IoT devices," Hayat advises. By addressing these challenges and concerns, Pakistan can ensure a successful rollout of 5G technology and unlock its transformative potential.

While we have conducted our own research and gathered findings on the challenges of implementing 5G technology in Pakistan, it is equally important to learn from the global experience. Countries that have already tested and implemented 5G technology can provide valuable insights into the setbacks and responses they received from stakeholders, as well as the impact on their country. By studying these international experiences, we can gain a deeper understanding of the challenges and opportunities associated with 5G technology and develop strategies to address them in the Pakistani context.

Global context and lessons learned

As Pakistan prepares to launch 5G technology, it is essential to learn from the global experience. Countries that have already rolled out 5G technology can provide valuable insights into the challenges and opportunities associated with this technology.

A notable example is South Korea, which led the world's biggest rollout of 5G five years ago. Despite promising a mega leap in network speeds, South Koreans are still waiting for the transformative impact of 5G. As SK Telecom, the largest telecom firm in South Korea, noted in a rare 6G white paper, the limited availability of devices that support 5G, low market demand, and regulatory barriers have hindered the widespread adoption of 5G services.

The South Korean experience is a cautionary tale for Pakistan. Despite investing $20 billion in 5G infrastructure, South Korea has struggled to fully utilise 5G technology due to limited 5G devices and regulatory restrictions. This highlights the importance of addressing these challenges before launching 5G services in Pakistan.

Another example is Bangladesh, which suspended its 5G rollout plan due to a shortage in its foreign exchange reserves. This decision is particularly relevant for Pakistan, given that Bangladesh's foreign exchange reserves are four times larger than Pakistan's. This underscores the need for Pakistan to carefully consider its economic situation before investing in 5G technology.

These global examples offer valuable lessons for Pakistan as it prepares to launch 5G technology. By learning from the experiences of other countries, Pakistan can avoid common pitfalls and ensure a successful rollout of 5G services.

The future

Despite these challenges, Hayat is optimistic about the transformative potential of 5G technology in Pakistan. He envisions 5G transforming various sectors, including healthcare, education, and finance. For instance, 5G can enable remote surgery and telemedicine, IoT-enabled patient monitoring, and augmented reality training in the healthcare sector. "5G technology is transformative across industries," Hayat says, "Offering higher speeds, lower latency, and greater device density."

In education, 5G can facilitate immersive virtual and augmented reality learning, remote and hybrid learning, and AI-based personalised learning. In finance, 5G can enable real-time payments and transactions, high-frequency trading, smart ATMs, and IoT banking, as well as AI-powered fraud detection. Hayat notes that these applications can have a significant impact on the economy and society, driving growth, innovation, and development.

Hayat also emphasised the government and regulatory bodies’ role which is crucial in facilitating its adoption. According to Hayat, "The government has a major role to play in facilitating 5G by making a new demand-side policy for 5G. The last comprehensive IT policy was made in 2000, and parts of it are yet to be executed. Moreover, the Digital Pakistan Policy lacks an implementation plan, making it essential to have a comprehensive roadmap for digital transformation.”

The PTA also has a vital role to play in encouraging operators to connect fiber to every BTS tower, ensuring a good 5G experience. However, Hayat notes that the existing infrastructure, with low fiber connectivity, has not been able to support even decent 4G services. "If customers do not feel the difference between 3G, 4G, and 5G experience, then it is not worth investing so much," Hayat says.

Given the current situation, Hayat's outlook on the timeline for widespread 5G adoption in Pakistan is cautious. "In the current situation where we see no demand for use cases, low appetite for investment, and weak infrastructure, it will take considerable time to have 5G adoption," Hayat predicts. In the next 2-3 years, Hayat expects to see only a few hotspots of 5G in major cities, with limited widespread adoption.

Overall, Hayat's insights highlight the need for a comprehensive approach to 5G adoption in Pakistan, involving both the government and regulatory bodies. By addressing the existing infrastructure challenges, creating demand-side policies, and encouraging investment, Pakistan can pave the way for successful 5G adoption and unlock its transformative potential.

Pakistan's journey towards 5G adoption is filled with both immense potential and significant challenges. While the government and telecom operators are actively working to lay the foundation for 5G, hurdles such as inadequate infrastructure, high costs, and limited device availability remain key obstacles.

The global experiences of countries like South Korea and Bangladesh offer valuable lessons, highlighting the importance of addressing these issues before fully rolling out 5G services. However, with strategic planning, investment in infrastructure, and fostering demand for 5G use cases, Pakistan can unlock the transformative potential of this technology.

5G holds the promise to revolutionise sectors such as healthcare, education, and finance, driving innovation and economic growth. As Pakistan prepares for the 5G rollout in 2025, its successful implementation could significantly enhance the nation's digital landscape, laying the groundwork for a more connected, efficient, and sustainable future.

Yet, despite all the challenges and lessons from global markets, the question remains: will Pakistan be able to implement 5G by April 2025?