KARACHI: Telecoms deregulation to benefit local firms
By Our Staff Reporter
KARACHI, Dec 20: Deregulation of telecommunications sector — when it is completely implemented in the country — would offer a host of opportunities to Pakistani companies and may benefit consumers.
This was the main talking-point at a seminar on “Telecoms deregulation and WTO policies” organized by the Karachi section of the Institute of Electrical and Electronics Engineers at a local hotel on Saturday.
Giving a technical presentation, Samir Hoodbhoy, director of Data Communications and Control, recalled that about 12 years back when the Pakistan telecommunications authorities had decided to replace archaic electromechanical network with digital exchanges, they had stipulated that only those companies could take part in the process which had at least five-year experience in the international market. “That naturally meant that most Pakistani companies could not take part in the process involving at least four billion dollars. It was also stated that Pakistani companies could take part in the process after 12 years, meaning after the deadline of the World Trade Organization,” he said.
He said the deregulation of the telecommunications sector had started in the United States. Speaking about the fast proliferation of mobile phones in the world, he said that in China there were more cellular phones than land-lines. He added that Pakistani companies could not enter the field of mobile phones hardware, but they could team up with multinational companies and carve out a niche for themselves.
He said tele-medicine was one of the fields that was expected to take off in Pakistan. “Doctors at many hospitals in downtown Karachi would be able to view their patients in the interior of the country with the help of this technology,” he explained.
Mr Hoodbhoy said globalization favoured well-endowed companies with assured market place and Pakistani companies should make themselves intelligent enough to exploit market opportunities offered by globalization.
Talking about telecommunications trends in Pakistan, he said the incumbent company enjoyed a number of advantages, such as a large market share, familiar brand, largely paid for network, good cash flow, strong relations with the government and large size.
Commenting on the deregulation of telecommunications sector, he said a new player faced tough challenge, as both the regulator and the incumbent belonged to the government. He quoted the WTO director of the trade in service as saying “industry spends a lot more on telecoms than on oil — and even the oil producer’s cartel has not distorted prices as much as telecommunications prices are out of line with costs.”
The two technical presentations were followed by a panel discussion.
