The Wireless & Internet Service Providers Association of Pakistan (WISPAP) has voiced significant apprehensions regarding the proposed revision of the licensing template for Data Class Value Added Services (CVAS) by the Pakistan Telecommunication Authority (PTA), expressing concerns over potential monopolistic practices.
PTA intends to amend the licensing template for CVAS to address discrepancies and introduce a simplified entry-level license for internet service provision in the nation, aiming to boost broadband proliferation.
The Authority has emphasized that over the past two decades, substantial changes have occurred in market dynamics and technological landscapes, profoundly reshaping the environment. These advancements have rendered the existing scope of Data CVAS License inadequate to correspond with the evolved technological shifts. Consequently, a revision of the Data CVAS License for internet service provision in the country is deemed necessary.
However, in response to PTA, WISPAP has scrutinized the consultation paper regarding the proposed CVAS licensing changes.
The Association has conveyed, "While we acknowledge the outlined objectives in the consultation paper, particularly the goal to rectify disparities in the current licensing framework and stimulate broadband proliferation in the country, we harbor certain concerns and recommendations regarding the proposed alterations."
Expressing their apprehensions, the Association has highlighted the potential ineffectiveness of the proposed changes in promoting internet proliferation, especially in underserved areas of Pakistan. Instead, there are apprehensions that the changes might predominantly favor existing Cable TV Operators who have already acquired licenses from PEMRA. Such a scenario could perpetuate industry stagnation due to monopolistic practices and regulatory challenges posed by certain cable operators.
Additionally, the requirement for CVAS operators to engage in agreements with local loop operators for infrastructure access poses a risk of monopolistic practices and undue pressure from these operators on CVAS operators. This could impede network operation and development significantly. "We suggest a reassessment of this requirement to ensure equitable competition and encourage independent infrastructure development by CVAS operators," WISPAP emphasized.
Moreover, the Association has advocated for all CVAS operators to have the autonomy to deploy their fiber optic networks independently without relying on agreements with Local Loop Operators or Cable TV Network Operators. This approach is expected to foster innovation, competition, and investment in network infrastructure, ultimately benefiting consumers and driving broadband adoption.
WISPAP has recommended that Cable TV Operators be prohibited from providing internet services to prevent anti-competitive behavior and promote a level playing field for both new entrants and existing internet service providers. Allowing Cable TV Operators to offer internet services could hinder market development and job creation. The Association has highlighted the current unethical practices employed by cable operators, including the division of areas and resorting to violence and intimidation tactics to secure customer connections, as deeply concerning. It suggests that the proposed changes should incorporate measures to address and eradicate these illegal and unethical practices.
Furthermore, the Association proposes that the area of operations for licensees be defined by government divisions (provincial divisions), such as Rawalpindi Division or Lahore Division, with an additional radius of 20 kilometers from division boundaries. This approach aims to ensure that businesses have a sufficiently large market to operate efficiently and effectively.
"While we concur with the proposed annual license fee of Rs. 100,000, we believe that the proposed annual increase of 10 percent is excessive. We recommend limiting the annual increase to no more than 5 percent to alleviate financial burdens on licensees. Additionally, we propose the removal of complimentary audit reports and user record updating requirements to streamline administrative processes," the Association added. It further suggested that there should be no restrictions on the medium used to provide internet services to customers. Licensees should have the flexibility to deploy either wireless/wired or both (fiber optics or Cat 6) networks based on their business requirements and market conditions.
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