Broadband sector of Pakistan is a true combination of a number of fixed and wireless technologies deployed by different operators. Although PTCL the incumbent, has a major hold on the broadband sector in terms of subscriber numbers, other operators are also pushing hard to establish their mark. Currently, broadband penetration of the country stands at 2.07% as of June, 2014 as compared to 1.52% at the end of the corresponding period last year. The slow rise in the penetration is due to a number of factors and an uplift requires concerted efforts by multiple stakeholders in the areas of consumer awareness, general literacy level, tariff reduction and local content development. It is expected that the launch of Next Generation Mobile Services (NGMS) services will play a crucial role in increasing the broadband penetration of the country by providing broadband services on smart phones.
Broadband subscribers stood at 3.79 million at the end of June, 2014 as compared to 2.72 million at the end of last fiscal year depicting 39% growth over the period under review. 1.07 million new subscribers have joined broadband networks in the FY2014, mainly due to the strong performance of PTCL. Growth rate of the broadband industry had been gradually declining with every passing year as depicted in gure – 24. However, the trend has reversed during FY2014. This is also supplemented by the fact that for the first time, broadband market has added over a million subscribers in a scal year which is a welcome sign for future.
Major Broadband Players:
PTCL is a major player in providing broadband services in Pakistan. PTCL has been successful in getting the major share of the broadband market by providing multitude of services and technologies under its umbrella. Ranging from ownership of international optical fiber links to availability of both fixed (DSL) and wireless (EvDO) broadband services, PTCL maintains a stronghold on almost every facet of the broadband market. Currently, PTCL has 80% share of the subscriber base consisting of 3.03 million subscribers including xed and wireless broadband services. The strength of the incumbent can be gauged from the fact that the net additions of PTCL i.e. 1,106,025 are actually more than that of the entire broadband sector combined. EvDO has been the main reason behind this growth due to 827,496 new subscribers added during FY2014.
Wateen, the next big operator, has 7.2% market share signifying the huge space between PTCL and other operators in the market. Subscriber base of Wateen stands at 273,794 at the end of FY2014 depicting a drop of 2.6% due to subscriber churn. PTCL’s performance had a major impact on the market position of Wi-Tribe and WorldCall as equal market share of 4.8% gives them the joint third spot in broadband market of Pakistan. Wi-Tribe has 182,854 subscribers by the end of June, 2014 as compared to 199,786 subscribers in June, 2013 declining by 8.5%. WorldCall, despite having a variety of broadband technologies i.e. DSL, HFC and EvDO, has 183,094 subscribers as of June, 2014 with growth of 1.5%. Qubee made a promising start in the broadband market last year but dropped its market share from 2.3% last year to 2% in June, 2014 with 76,926 subscribers. Other companies constitute the remaining 1.2% of the market.
Broadband Technology Trend:
Pakistan’s broadband market has rich presence of latest high speed technologies due to technology friendly regulatory environment being provided by PTA. Historically, broadband over fixed line infrastructure (DSL, FTTH, HFC) were the only available mediums for delivering high speed internet. With the ingress of wireless technologies (WiMax and EvDO), a new array of wireless solutions changed the broadband landscape of the country entirely. Currently, wireless media is the dominant force in the broadband market surpassing the xed line technologies by a considerable margin. EvDO is leading the market with 1,861,118 subscribers surpassing the DSL subscriber base of 1,346,817 by a clear margin at the end of June, 2014. After an impressive start in 2008, WiMax has been losing subscribers for the last two years reducing currently to 530,889 due to subscriber churn and poor performance of the operators using this technology to deliver broadband services. HFC remains on the bottom line with 37, 011 subscribers at the end of FY2014.
Currently, EvDO leads the subscriber market share with 49% at the end of FY2014 followed closely by DSL at 35.5% subscribers. WiMax services hold the third spot with 14% which was at 28.6% in 2010.
Wireless technologies have increased their market share to 63.1% at the end of June, 2014 while fixed line technologies hold 36.9% share. This market situation is in stark contrast to the global technology trends where fixed line dominates the broadband market in most of the countries.
Broadband Tariffs & Offers:
Broadband market of Pakistan has seen a gradual decrease in tariffs over the years in lieu of the introduction of new players and technologies. Cost of service remained a major barrier to the broadband proliferation in the country as the upfront installation charges and staggered Customer Premises Equipment (CPE) cost were in addition to the monthly tariff being charged by the operators. However, the upfront charges have been increasingly reduced by the major operators paving way for the customers to subscribe to the broadband service at affordable rates.
PTCL has been actively rolling out new and innovative offers to generate demand for broadband services. The incumbent announced that it will offer free EVO devices to all DSL subscribers as a backup connection with no device charges and a monthly line rent of Rs. 500. The operator also recently upgraded the existing 1Mbps DSL package to 2Mbps free of cost till 31st March, 2015. However, afterwards the subscribers will have to pay higher rates to continue with 2 Mbps speed. Wi-tribe launched a monthly “Win with Wi-tribe” customer engagement program under which its loyal customers are awarded with lucrative rewards through lucky draw. Qubee also offered free Wi-Fi routers and customized tariff plans to attract new customers. Wateen offered incentives to the customers by giving unlimited download volume at no additional cost. Launch of a new entrant ‘Burq Broadband’ in the wireless broadband market providing Wi-Fi prepaid services is also expected to further enhance the broadband delivery in Pakistan.