Broadband growth: don’t blame the economy!

Published: August 2, 2012
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The writer is SEVP/Chief Commercial Officer of the Pakistan Telecommunication Company Limited (PTCL)

The writer is SEVP/Chief Commercial Officer of the Pakistan Telecommunication Company Limited (PTCL)

The current global economic recession has had a spiral effect worldwide and only a few segments have been able to resist its impact. However, the amazing growth of broadband in the last decade is an outstanding national success story. High-speed internet streaming is revolutionising the way people learn, communicate, work and do business. Broadband internet is now the backbone of corporate services and even small businesses.

Owing to their own limitations, some telecommunications operators are making misleading claims about the state of broadband penetration in Pakistan by incorrectly linking it with the country’s economic situation. Contrary to such ill-informed claims made in haste, the country has witnessed a 70 times increase in broadband proliferation in the last six years. The numbers speak for themselves.

According to the Pakistan Telecommu-nication Authority (PTA) data, the number of broadband internet subscribers in Pakistan increased from less than 27,000 in 2005-2006 to more than 1.9 million in 2012. One website, Internetworldstats.com, puts Pakistan’s total internet users at more than 29 million with a population penetration of 15.5 per cent. The total number of fixed phones and mobile phone subscribers stand at 3.1 million and 118.3 million, respectively. The PTA data further reveals that broadband internet put up an impressive growth rate of 28 per cent from June 2011 to March 2012, surpassing a mobile growth rate which stood at nine per cent for the same period. Given these facts, conveniently blaming the economy to cover operators’ own institutional limitations and lack of infrastructural capacity are tantamount to a disservice to the nation.

Broadband services were first introduced in Pakistan in 2001, by installing equipment on existing copper lines used for provision of telephony services. Initially, DSL broadband services were only provided to a small consumer base of high-end users in the big cities. But progress was slow and penetration was negligible. In response, the Government of Pakistan introduced the Broadband Policy of 2004, revising backhaul bandwidth charges downwards to propel broader penetration.

Broadband growth has been achieved during recession years, where the average GDP growth rate has remained less than four per cent per year. Today, broadband internet is a household product and one connection serves an entire family.

Pakistan is ranked among the top few countries to have registered high growth in broadband internet penetration in recent years. According to global broadband tracker Point Topic’s 2011 report, Pakistan stood in fourth place in Asia with 46.2 per cent growth in subscriber base whereas Sri Lanka and India were placed at number 11 and number 14, respectively. The tremendous potential of broadband internet in Pakistan can be gauged by analysing the last four years’ progress through the PTA’s data. Broadband internet penetration was less than one percent per household in 2008. In 2012, it has reached seven per cent. This mammoth growth has fuelled a broadband revolution, resulting in an increase in customer base and also helping wireless broadband technologies to expand setting the economic wheel in motion.

Despite hollow claims, the truth is that the growth trajectory of broadband is not the same for all operators. A sluggish economy and power crisis is not the reason for this stark dichotomy. Rather, it depends on an operator’s network, infrastructure capabilities, investment size, business model and growth strategy. Technology takes time to grow but once the wheel is set in motion, the effect is viral.

Published in The Express Tribune, August 3rd, 2012.

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Reader Comments (11)

  • HighAnxiety
    Aug 3, 2012 - 3:08AM

    Thank you. Great Read.

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  • Aftab
    Aug 3, 2012 - 12:32PM

    An eye opener!

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  • Aug 3, 2012 - 2:23PM

    Oh please! Less than 1% of the population has broadband and you are calling that a big success story. There has been no decrease in broadband tariffs for two years now. There is no growth only stagnation.

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  • Concerned consumer
    Aug 3, 2012 - 2:48PM

    Dear Mr Saeed,

    First off, I’d to like to compliment you on your writing skills. I thoroughly enjoyed reading this op-ed. It was highly informative (although it appears to be responding to something – is this the case? I’d love to read that piece also if so).

    However, I do have a few points:

    Regarding the “amazing growth of broadband” you referred to in the first paragraph and continue to refer to in the following paragraphs. You stated that “the country has witnessed a 70 times increase in broadband proliferation in the last six years.” You go on to state that, according to the PTA, “the number of broadband subscribers in Pakistan increased from less than 27,000 in 2005-2006 to more than 1.9 million in 2012.”

    I am curious if this is the phenomenal growth that you are referring to? Pakistan has a population of 175 million – 1.9 million BB users puts penetration at about 10%. Surely you do not think that this is a great number? Especially when you look at the fact that (as per your story) there are 29 million internet users. That means that less than even one percent of of total internet users in Pakistan are currently subscribed to Broadband. That does not seem like great growth to me in the broadband sector.

    Also, if things are so fantastic, why is it that PTCL has just announced another round of Voluntary Separation Scheme (read: ‘lay-offs’) for 10,000 staff members in this year over and above the 30,000 last year?

    I do not mean to disparage your august institution in any way. However, I’d love your view on the above two points.

    Respectfully,

    A Concerned Broadband Consumer

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  • Narain
    Aug 3, 2012 - 3:47PM

    Wow… Way to go, Pakistan!!

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  • Someone
    Aug 3, 2012 - 6:42PM

    @abdussamad: 1%? You do realise that you are grossly overexagerating? Or are your mathematical capabilities stagnating?

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  • Naresh
    Aug 4, 2012 - 4:42PM

    @Someone Ji:
    .
    Abdussamad Ji is Right.
    .
    Pakistan’s Population per the 2011 Census is over 197 Million.
    .
    As such 1.9 Million is less that ONE PERCENT.
    .
    You should question the “Calculations” of who states : Pakistan has a population of 175 million – 1.9 million BB users puts penetration at about 10%.
    Cheers

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  • Aug 5, 2012 - 10:31AM

    I side with Naveed Saeed in the assertion: “It is not about economy; it’s about capability.” As a matter of fact, in harsh economic environs, businesses are cutting costs and also trying to improve efficiency. ICT (read ‘Broadband’) provides efficient tools to cut costs and improve efficiency. Telepresence is one such tool. It obviates the need to physically travel hundreds, even thousands of miles. Companies save time, money and the tremendous personal cost of leaving ones home/office (not to mention adjusting with flight schedules, availability of seats and suspension of all other activities back home). Providing Telepresence services to businesses is an immense opportunity for an innovative ICT service provider. While Immersive Telepresence mimicking the real life, face-to-face business meetings, is at the higher end, Audio/Video teleconferencing facilities cater to mid and low-end consumers. It’s a win-win situation for service providers who make their millions, and the users of services who save millions.
    But broadband is not just about improving the balance sheet. The social impact of broadband in empowering citizenry is incalculable. Telemedicine, eHealth, eLearning, eMoney, eGovernance (in short eAnything), are just a few instances where human existence is undergoing a tremendous transformation. Inamul Haq, Editor Telecomplus

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  • Tanveer Ahmed
    Aug 15, 2012 - 11:21AM

    The article given above summarizes the issue quite clearly about the broadband growth, those claiming that growth has been stagnant are clearly misled by unreliable sources.

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  • ahmed malik
    Aug 15, 2012 - 11:32AM

    No doubt PTCL has achieved a benchmark of 1 million customers

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  • Faizan Ali
    Aug 17, 2012 - 3:21PM

    Very well said by Mr. Naveed Saeed this article tells the privelage history of PTCL.

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