News: The Pakistani government has finally granted approval to the much-awaited 3G spectrum auction in the country. Under the policy directive issued by the government, the auction will be technology-neutral, so if the operators want they will be allowed to install 4G rather than 3G. The government expects to raise between US$1bn and US$1.5bn from the auction. Meanwhile, the Pakistan Telecommunications Authority (PTA) has invited proposals for a consultant or consultants, who would be responsible for determining the number and size of the blocks to be allocated and managing the auction process. Interested parties are required to submit bids by November 12.
BMI View: Pakistan lags behind most countries in the Asia Pacific region on multiple fronts. Mobile operators rely heavily on prepaid subscribers in light of consumers' low purchasing power. The regulator has also repeatedly failed to auction 3G licences, which would boost the otherwise depressed ARPU levels. Although the low mobile penetration rate indicates the mobile market should be experiencing high growth, the momentum has been disappointing as operators struggle to fulfil the sector's potential.