Pakistan’s Spectrum Policy Under Scrutiny: Challenges for Mobile Services Development
Introduction to Pakistan’s Spectrum Issues
Pakistan’s spectrum policy is under the microscope as the Global System for Mobile Communications Association (GSMA) has raised concerns over the country’s mobile network infrastructure. GSMA has highlighted the unsustainable cost of spectrum and its detrimental impact on the development of mobile services in Pakistan. According to the GSMA, Pakistan currently holds the lowest spectrum allocation in the Asia-Pacific region. This stark contrast to its neighboring countries poses a significant challenge to Pakistan’s ambitious digital transformation efforts, including its flagship “Digital Pakistan” initiative.
The Impact of Limited Spectrum on Mobile Services
In a recent paper, GSMA pointed out that the lack of sufficient spectrum and the rising costs are putting the country at a disadvantage. Spectrum is a vital resource for mobile network infrastructure as it enables mobile operators to offer reliable and high-speed services. In countries such as the Philippines, Vietnam, Thailand, Bangladesh, and Indonesia, operators have access to more spectrum, giving them a distinct edge in terms of mobile service quality and digital development.
The Role of Mobile Infrastructure in Digital Transformation
Mobile networks are at the core of Pakistan’s digital transformation strategy. With the rapid evolution of digital services, from mobile banking to e-commerce, efficient mobile networks are crucial for socio-economic development. Pakistan’s mobile infrastructure has been vital in connecting underserved areas, empowering citizens, and facilitating economic growth. However, this growth is now threatened by the scarcity of spectrum.
Pakistan’s Digital Pakistan Initiative
Launched in 2018, the “Digital Pakistan” initiative aimed to improve digital infrastructure across the country. The goal was to create a more connected and technologically advanced society, fostering innovation and economic progress. However, GSMA’s analysis of Pakistan’s spectrum policy suggests that the initiative is at risk due to challenges related to spectrum allocation, pricing, and availability.
Despite the government’s focus on digital transformation, GSMA noted that mobile infrastructure faces several constraints that hinder its potential. One of the most significant issues is the high cost of spectrum, which is preventing mobile operators from acquiring the necessary resources to expand their networks and improve coverage.
The Economic Consequences of Unsold Spectrum
GSMA Intelligence’s analysis reveals that Pakistan has faced significant losses due to unsold spectrum in previous auctions. This has resulted in a shortage of available spectrum for mobile operators, further contributing to slower network rollout and reduced 4G adoption. For instance, the spectrum auctions held in 2014 and 2021 left substantial portions of spectrum unsold, depriving the mobile sector of much-needed resources.
Potential Economic Benefits
If spectrum had been fully allocated during these auctions, Pakistan could have reaped an additional $300 million (approximately Rs80 billion) in economic benefits. The GSMA paper emphasizes the long-term consequences of this inefficiency, noting that it is stunting Pakistan’s digital progress and reducing the overall competitiveness of its mobile services sector.
The Need for Change in Pakistan’s Spectrum Auction Strategy
In light of these challenges, GSMA has called for a fundamental shift in Pakistan’s approach to spectrum auctions. The upcoming spectrum auction should prioritize the enhancement of digital infrastructure rather than maximizing government revenue. This strategic shift will enable the mobile sector to thrive and support Pakistan’s digital transformation goals.
Key Recommendations for the Upcoming Spectrum Auction
- Focus on Infrastructure Expansion
The GSMA recommends that the primary focus of Pakistan’s upcoming spectrum auction should be on improving the country’s digital infrastructure. Instead of prioritizing revenue generation, the government should prioritize spectrum availability and affordability to ensure that mobile operators can expand their networks. - Allocation of 600 MHz Spectrum
Pakistan’s government has indicated that 600 MHz of spectrum will be available in the upcoming auction, including more than 500 MHz in core mid-bands like 2.3 GHz, 2.6 GHz, and 3.5 GHz. GSMA advocates for the inclusion of these bands as they are crucial for meeting the growing demand for high-speed mobile data and bridging the current spectrum shortfall. - Affordability of Spectrum Pricing
One of the most pressing issues highlighted by GSMA is the excessive cost of spectrum in Pakistan. High spectrum prices have been linked to slower mobile data speeds, poorer coverage, and delayed network rollouts. To avoid these negative outcomes, it is essential to ensure that spectrum pricing remains reasonable and accessible for mobile operators.
Consequences of High Spectrum Prices
GSMA has conducted studies that establish a direct correlation between high spectrum prices and slower mobile data speeds. In countries with inflated spectrum costs, mobile operators are unable to invest in the necessary infrastructure, leading to poor network performance and delays in expanding service coverage. As a result, consumers bear the brunt of these inefficiencies, experiencing slower data speeds, reduced coverage, and limited access to high-quality mobile services.
The Link Between High Spectrum Prices and Industry Growth
Research from GSMA Intelligence and other sources indicates that excessively high spectrum prices can stifle competition in the mobile services sector. When mobile operators are unable to afford the necessary spectrum, they are unable to invest in network upgrades or expand their coverage areas. This results in a stagnant or even declining mobile services market, which ultimately impacts consumers and the overall economy.
The Path Forward for Pakistan
To address the challenges posed by the current spectrum policy, Pakistan must take proactive steps to reform its approach. This includes adjusting spectrum pricing to ensure that it is affordable for mobile operators, allocating more spectrum for 4G and 5G networks, and creating a more competitive environment for the mobile services industry.
Ensuring Long-Term Sustainability
Pakistan’s mobile services sector faces significant challenges, but with the right policies, it can overcome these hurdles and thrive. By investing in infrastructure, addressing spectrum shortages, and ensuring reasonable pricing, Pakistan can lay the foundation for a robust digital economy that benefits businesses, consumers, and the government.
FAQs
1. What is spectrum, and why is it important for mobile networks?
Spectrum refers to the range of electromagnetic frequencies that mobile networks use to transmit data. It is essential for enabling fast and reliable mobile communications, including internet access, voice calls, and text messaging.
2. How does Pakistan’s spectrum policy impact mobile services?
Pakistan’s spectrum policy has led to a shortage of available spectrum, which hampers mobile operators’ ability to expand networks, improve service quality, and roll out 4G and 5G technologies efficiently.
3. What are the consequences of unsold spectrum in auctions?
Unsold spectrum during auctions means that mobile operators are unable to acquire the necessary resources to expand and enhance their networks. This leads to slower network rollout, reduced service quality, and slower adoption of advanced technologies like 4G and 5G.
4. Why does GSMA recommend focusing on digital infrastructure in the upcoming auction?
GSMA believes that focusing on digital infrastructure will ensure long-term growth and development in the mobile sector. By prioritizing spectrum allocation and affordability over revenue generation, the government can help mobile operators enhance their networks and deliver better services to consumers.
5. How can Pakistan benefit from improving its spectrum policy?
By improving its spectrum policy, Pakistan can attract more investment in mobile infrastructure, improve service quality, and ensure that its digital transformation goals are met. This would lead to a more competitive mobile market and a better overall experience for consumers.
