Includes 3 FREE quarterly updates
BMI View: Pakistan's telecommunications market is one of the most underdeveloped in Asia Pacific. At
the end of 2011, Pakistan had the region's second lowest mobile penetration rate, a situation that is also
similar in the fixed-line and broadband sectors. Additionally, the regulator has yet to auction 3G
licences, leaving mobile operators dependent on basic 2G voice and SMS for revenue generation. This
leaves Pakistan with significant room for growth, although the potential could materialise only in the
- Our forecasts for Pakistan's telecoms industry - mobile, ARPU, fixed-line and internet - have
been extended to 2017.
- Data from Mobilink and Telenor Pakistan indicate that net additions have tapered in Q212 and
- Mobile broadband technologies are expected to drive growth in the Pakistani broadband sector,
although high prices would continue to deter adoption; we envisage broadband gaining a 3.0
%penetration rate in 2017.
Key Trends And Developments
At the time of writing, the Pakistani government has yet to announce a concrete date for the auction of 3G
licences. A pre-bid conference for the selection of an international consultant to facilitate the auction
occured in September 2012 but there has been a lack of development since.
The Pakistan government's shutdown of mobile networks over the Muslim festival of Eid-ul-Fitr is
believed to have cost the country's telecoms sector between US$2.6mn to US$3.1mn. The shutdown,
attributed to security concerns, took place at a time of the year when mobile telecom activity was at a
peak, as people look to connect with their family and friends over festivities. In September 2012, the
government blocked telecoms services in 14 cities to deter militants from detonating bombs during
Pakistan had a Telecoms Ratings score of 47.3 in BMI's latest Asia Pacific Telecoms Risk/Reward
Ratings. After a three-year long saga, the National Reconciliation Ordinance (NRO) debacle appears to be
coming to a close. In our view, given the looming end of the NRO saga, political risk on this front should
be minimised and the ruling Pakistan People's Party's political credentials should receive a boost.
Furthermore, we believe that Pakistan has moved one step closer towards long-term political stability.
The government should now have time to address some of the country's more pressing issues.