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Getting ready for the 5G network – are we there to jump in?

The world is changing rapidly and to compete with other nations we need to adopt new technologies. The last 3G/4G spectrum auctions for telecom services happened in 2014. Pakistan has already been successfully experiencing 3G and 4G mobile broadband technologies and the number of users is increasing every day. Rapidly increasing demand for high bandwidth telecom services has moved into gaining pace towards 5G testing in Pakistan. Undoubtedly, introducing 5G will be a positive sign for Pakistan as it would open a new arena for smart devices and ensure career and investment opportunities in Pakistan during upcoming years.

Mobile broadband penetration today is a resounding reality in Pakistan. It is only growing stronger with our base of mobile subscribers crossing the 150 million plus mark and a clear upward trend in the take-up of 4G subscriptions reported by all three MNOs that offer 4G services (ZongCMPak, Jazz and Telenor). This awareness now extends to 5G, especially with the present government hinting at a possible 5G launch in Pakistan by 2020. At the center of this new technology lies the promise of the Internet of Things (IoT). Already present here in the form of ‘connected’ TVs, house appliances and cars, the introduction of live 5G services will take the IoT to the next level. Smart cities, especially in the wake of climate change and ‘green’ sustainability will be looked at as tangible solutions. The concept of ‘smart buildings’ for work will gain traction and virtual/augmented reality will become more popular in the retail and entertainment industries. Focus on 5G is part of many South Asian countries’ political outlook.

Unlike South Korea, the network evolution path for the networks in Pakistan does not entail jumping directly to 5G as the network utilization needs to be mature enough to gain from higher capacity introduced by 5G systems. Networks in Pakistan have yet to cover LTE Advanced, Massive MIMO and other capacity building solutions before jumping on to 5G. The successful adoption of 5G requires certain ‘enablers’. These include mobile device compatibility, availability and choice; even-handed pricing; awareness in usage of 4G’s capabilities and widespread network coverage.

 

One of the issues in Pakistan is government policy which went from extremely favorable (when Warid and Telenor entered the market) to becoming a “tunnel-vision” policy. Taxation, impact of terrorism on network services and general apathy from the telcos in terms of service offerings all slowed down growth and hampered maturity of networks. However, CPEC may provide the necessary market disruption for launch of 5G. Mobile banking and mobile wallet usage is another high potential area provided fintechs get the requisite government support and traditional banks awaken from their deep slumber.

4G also had a significant impact on mobile phone banking transactions. The State Bank of Pakistan (SBP) reported that these transactions had crossed the Rs 410 billion mark, translating to a growth of 195%. According to the SBP, there are approximately 3.4 million registered users of mobile phone banking apps, with the bulk of the transactions falling under intra- and inter-bank funds transfer. However, usage seriously needs to move beyond the funds transfer category to the mobile commerce and retail sectors, especially with the enabling widespread access of 4G.

The writer is a Karachi based freelance columnist and is a banker by profession. He could be reached on Twitter @ReluctantAhsan

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