Interest of Saudi Telecom and Turk Cell in the auction of 3G and LTE licence in Pakistan

The chances of new international telecom operators in the auction for 3G/4G spectrum are going high after Turk Cell, Saudi Telecom Company (STC) have also arrived to study its business case and to assess market condition, it is learnt. Well-placed sources told Business Recorder that a two-member delegation of STC has reached the country and met Chairman Pakistan Telecomm-unication Authority (PTA) Syed Ismail Shah where queries about market, broadband services and opportunities for new entrants were made.

Chairman PTA briefed the delegation about the revised Information Memorandum (IM) for 3G/4G auction. Sources said the delegation is currently in the country and would meet State Minister for Information Technology (IT) Anusha Rehman and other high-ups next week and would file a report to their Board of Directors. A delegation of Turkish mobile phone operator Turk Cell also visited the country last week to study its business case regarding the spectrum auction.

Prime Minister Nawaz Sharif has approved the final policy directive on Monday last and the PTA has published revised IM according to which interested operators can submit their application and sealed bid for participation along with pre-bid deposits by April 14, 2014. The auction would be held on April 23, 2014 to mobilise over $1.5 billion non-tax revenue. There are three 3G (in 2100 MHz) and two 4G (in 1800 MHz) licenses to be auctioned through two-stage bidding. One 15 MHz spectrum from 850 MHz band will be allotted if any new operator gets the license.

According to the policy directives, the base prices are set as (i) $295 million for 10MHz paired spectrum in 1.9/2.1GHz frequency band (ii) $210 million for 10MHz paired spectrum in 1800 MHz frequency band (iii) $291 million for 7.38MHz paired spectrum in 850MHz frequency band. The inclusion of 1800MHz band was exclusively done to catalyse the deployment of 4G in Pakistan. Spectrum in 850MHz will give incentive for new entrants in Pakistan and will certainly foster competition.