Two new links (a submarine cable and a land link with India) are due to commence operation later this year

July 25 - 31, 2005




The real impact of the optic fibre cable breakdown will be realised in time. However, for the foreseeable future fortunately, two new links (a submarine cable and a land link with India) are due to commence operation later this year. In addition, several new contracts that had hung in the balance seem to be gradually returning to Pakistan in the hope that a lesson has been learnt and that the industry, with the support of the government, will develop a sustainable contingency plan for future mishaps.

Shortly before a faulty fibre-optic cable practically crippled Internet access across Pakistan on June 27, Pakistan reportedly had around 30 call centre operators that employed an estimated 2,000 people, and collectively generated US$15 million a year in revenues. On the street, call centre agents were the new business class with excellent salary packages, international exposure, and potential for professional development.

The damaged underwater cable called Southeast Asia, Middle East and Western Europe-3 or SEA-ME-WE3 or SMW3 was Pakistan's sole international cable link for data and the Internet. The fault disrupted Pakistan Telecommunications' links with the rest of the world and caused a few problems across neighbouring India. Some effects of the disruption also troubled parts of the United Arab Emirates, Oman and Djibouti.

Some businesses came to a grinding halt. Since Pakistan had no contingency plan for such an unexpected unfolding, it took 3 to 4 days to restore limited Internet access at selected levels albeit with degraded line quality. Among the hardest hit by the crisis were call centre operators. "The fledgling call centre business may have suffered a fatal blow but we are optimistic that new business prospects should reassure international investors," said a call centre manager based in Karachi.

President of the Association of Call Centre Operators of Pakistan Abdullah Butt was quoted as saying that once the reality had set in, it was all about "damage control". Industry experts fear that international investors might now be compelled to question if Pakistan has adequate back-up for the future. A UK-based company operating in India is said to be re-evaluating a $10 million investment plan in Pakistan after the communications collapse.

The country's premier communications provider, PTCL, managed to scramble back-up satellite links for businesses, including call centres at the end of the week but the damage had been done. The back-up system could not put up with the volume of Internet usage in the country and most services remained dormant. These included Internet cafes, ATMs, banking services such as credit and debit cards, and other on-line and IT services.



According to an ISPAK representative, Pakistan generally has 600 Mb external international connectivity generally available, but was restricted to using 34 Mb through the back-up. The country's 10 million plus Internet users and over 50 ISPs were left with no option but to limp. It took nearly 11 days for the service to be restored completely. This also put immense pressure on the freshly restored Internet and on-line services networks as businesses scampered to secure positions.

Inside sources revealed that hundreds of employees had already been laid-off by the country's stunned call centres during the initial phase of the problem when they drastically lost operating revenues and contracts. Some 20 call centres did not have back-up capacity and these were the worst hit. Many international transactions have also been severely dented and may leave a negative impact on the financial sector.

The impact on the call centres and IT services in Pakistan has led to widespread international criticism about the country's dependence on a single high speed cable, the limited satellite backup arrangements, and the prioritisation of backup connections to support that country's commercial call centres at the expense of other business sectors.

Service disruption in India was confined to telecommunication customers of the Reliance Group, which uses SMW3 in India. Indian Call centers that depend exclusively on Reliance for service may face financial doom and shut down as a consequence. However, most Indian call centres had sufficient satellite backup facilities to switch over without any trouble.

Companies in Pakistan did not have any back-up systems and were forced to rely on the PTCL service. Some companies that had the required resources to shift operations away from Pakistan have already done so 'to maintain the integrity of end-user systems', according to a business automation executive.

The government has been reacting positively under the command of Minister for Information Technology, Awais Leghari, who is forcing the pace of accelerated alternatives. Most industries depend heavily on on-line services since the worldwide IT revolution and we can only hope that such an incidence can be averted in the future before it leaves a lasting impact on the economy and on Pakistan as an unreliable business destination.