Telecom sector: Pakistan to have 40 million smartphones by end of 2016

Published: September 9, 2015
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$100m is the overall size of the fast growing e-commerce market that has increased two-thirds from $60 million as of December 2014. PHOTO: AFP

$100m is the overall size of the fast growing e-commerce market that has increased two-thirds from $60 million as of December 2014. PHOTO: AFP

KARACHI: 

There will be 40 million smartphones in Pakistan by December 2016, according to market estimates, based on current trends in the e-commerce sector, says a major player.

According to sources in the e-commerce market, the estimate, along with the optimism surrounding it, is being driven by the recent growth of telecom sector, particularly the increase in number of mobile broadband users.

In Pakistan, third-generation (3G) and 4G mobile phone users stand at 14.6 million as of July 2015 and continue to grow, creating a huge demand for smartphones, which is the top selling category across all major e-commerce platforms.

Publicly available data shows mobile phone imports in terms of value and not in units, making it difficult to figure out category-wise imports. However, market sources say less than 20% of Pakistan’s monthly mobile phone imports comprises smartphones. This equation though is likely to change in a couple of years, they added.

More than two million users a month are looking to buy a phone online, according to Daraz.pk Co-Founder Muneeb Maayr. To capitalise on this growing demand, major industry players from service providers (telecom operators) to mobile phone makers and an e-commerce platform have partnered with internet giant Google to promote online trade by offering exclusive discounts on mobile phone purchases just ahead of Eidul Azha.

Titled Google’s Tech Mela, the 10-day event, which goes live on September 11, is an online shopping festival which brings many new phones launched recently at discounted prices and deals from major mobile phone brands.

“With this event, Google aims to support the vibrant and growing culture of e-commerce in the country,” Maayr told The Express Tribune, adding it was an exciting platform to raise awareness and consumer adoption of e-commerce in Pakistan.

The participating companies include Samsung, Microsoft, Huawei, PTCL, Rivo, TPL Trakker, Innjoo, Infinix, Intex, Telenor and Zong which are offering products from tablets to personal tracker devices and data bundles.

DESIGN: NABEEL AHMED

“This is the first of many online shopping festivals to come to Pakistan, and smartphones are a good assortment to begin this festival with,” Maayr said, responding to a question about whether they planned to promote products other than smartphones.

According to him, Google’s regional head for Asia is in Pakistan for a week scoping out on how best to participate in the development of ecosystem for internet usage.

The country’s e-commerce market is still in its infancy and represents only 5% of conventional retail trade. However, the overall size of this fast growing segment has come close to $100 million, up by two-thirds from $60 million as of December 2014, said Homeshopping.pk Chief Executive Officer Shayaan Tahir in a recent interview.

A bulk of the country’s e-commerce transactions originate from Karachi, Lahore, Islamabad and Rawalpindi, which comprise about 50% of customers, Maayr said, adding the remaining customer base is very thinly split between cities and towns nationwide.

With telecom operators rolling out 3G and 4G services in semi-urban and rural areas of the country – which usually don’t have outlets for branded products – the e-commerce market is likely to benefit a great deal.

Published in The Express Tribune, September 9th,  2015.

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Reader Comments (9)

  • Rollin & Trollin
    Sep 9, 2015 - 11:33AM

    To compensate for a general lack of ‘smarts’, we need even smarter phones…Recommend

  • Sep 9, 2015 - 6:34PM

    “The country’s e-commerce market is still in its infancy and represents only 5% of conventional retail trade.”

    This statement isn’t true. Retail industry size of Pakistan is $60 Billion and e-commerce market size is 100 Million. That makes e-commerce 0.16% of retail size. Even India’s e-commerce market size is less then 2.5% of conventional retail. 5% isn’t infancy its a crazy number. Recommend

  • Rollin & Trollin
    Sep 9, 2015 - 8:04PM

    @Nowkhaiz: In most countries where e-commerce has really taken off is where credit cards are widely used online and which presupposes robust information security protocols and standards.Recommend

  • N.S
    Sep 10, 2015 - 6:15PM

    This is because e-bay and Amazon are not working in Pakistan, because of PayPal not operating in the country. E-commerce retail need big investment in logistics, warehousing as well. Recommend

  • Sanda Chowk
    Sep 12, 2015 - 8:55PM

    Products as Sanda Oil not available at Tech Mela, to which Microsoft is the biggest buyer of Sanda Oil used in herbal, medicinal preparations. Tech Mela is excellent forum to launch Sanda Oil to the youth of Pakistan. Office employees gets it free in limited quantities to executive male staff. Im sure other tech. companies are waiting for this opportunity.Recommend

  • Xnain
    Sep 14, 2015 - 5:52PM

    This is insane! this mobile phone has destroyed the society in ways we cant even perceive. Government needs to curb this menace and erect controls before this social evil gets completely out of hands. Recommend

  • Ag
    Sep 15, 2015 - 4:23PM

    The 14 million number sounds far fetched. There were less than 5 million smart phones last year. Nothing significant has increase the purchasing power of the consumer. Fact checking is essential coupled with accurate research.Recommend

  • Np
    Oct 1, 2015 - 3:29PM

    @Rollin & Trollin: while your general point is accurate, in India cash on delivery is a way to circumvent the fear of credit card and debit card. The reason Uber cabs have been trumped by Ola cabs is Uber insists on credit card payment while Ola accepts cash.Recommend

  • Np
    Oct 1, 2015 - 3:33PM

    @Ag: the roll out of 3G created need for smartphones. Until then even those with ability to purchase smartphones would have found no benefit in doing so. As an Indian, I do not know if the number of 14 million is valid or not, but it is not farfetched considering that as time passes from the rollout of 3G, the number of smartphones is bound to increase.Recommend

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