To be, or not to be: Delay in 3G licence auction a distinct possibility

Last-minute issues may force the PTA to delay.

KARACHI:

While officials may choose to remain tight-lipped about the possibility of a delay in the third generation (3G) licence auction, The Express Tribune has learnt that the Pakistan Telecommunication Authority’s (PTA) road map for the introduction of the technology in Pakistan has hit snags.

On January 20, the PTA had published an Information Memorandum (IM) with details of the procedure for issuance of operator licences in the 1900-2100 MHz radio frequency spectrum (the 3G/4G/LTE band). In it, the authority had announced March 29 as the date of the auction. Recent developments indicate that the schedule may not be easily followed.

With the auction date looming right around the corner, a senate standing committee on IT and telecom has proposed several amendments to the policy draft that will guide the auction.

The committee has asked the PTA to remove ‘4G’, ‘LTE’ and ‘technology neutral’ from the draft proposal, and to raise base price from $210m to $291m. It has also asked the regulator to reject any bids from a defaulter – Ufone, in this case. In short, the PTA has been asked to revise the whole policy draft when it has already been advertised, and potential bidders invited to submit their Expressions of Interest (EoIs).

The PTA chief, in an interview with More Magazine, has confirmed that the PTA will submit to the committee’s recommendations. In light of this revelation, industry sources are skeptical that all amendments will be incorporated in time for the March 29 auction.

On top of these concerns, a February 21 ad on the PTA website revealed that the PTA has also invited EoIs from consultancy firms for conducting the auction, the deadline for which has been set for March 26; merely two days before the scheduled auction date. The ad said that once the PTA shortlists qualified bidders, the latter will have another 15 days to turn in their technical and financial proposals. It may be impossible, therefore, that any of them will be ready for the auction on March 29.

As yet, the PTA hasn’t announced any change in the auction date, nor has it amended the IM draft. Officials, it seems, have sealed their lips on the topic.

“These questions are policy related. The Ministry of IT may be able to respond them better,” Chairman PTA Muhammad Yaseen said in response to email queries Tribune sent him. He neither denied, nor confirmed if the auction would be held on time.

Yaseen also evaded queries on the Pakistan Telecommunication Company Limited (PTCL), of which Ufone is a subsidiary, with a similar response. However, he maintained that the PTA will provide a level playing field to all operators.

When contacted, PTCL’s spokesperson refuse to comment on the issue of $800 million in outstanding payments on its part. The matter was to be dealt by Etisalat, the parent company of PTCL, she said.

The Ministry of IT (MoIT) could not be contacted for their version, but a PTA official said that a delay was a distinct possibility. However, he maintained that things will proceed according to plan, unless the PTA makes changes to the IM – the only legal document that governs 3G licencing.

The official asserted that the PTA cannot comment further on the issue as it only follows and executes government policy. He said that the IM is subject to updates and amendments and the Auction Supervisory Committee is the only body authorised to amend the policy. It will take all decisions in the greater national interest, he said.

The official reiterated that if no amendments are made, the PTA will stick to the guidelines provided in the IM.

Published in The Express Tribune, February 24^th, 2012.