Pakistan’s 5G Auction at Risk Due to This Reason

The delay in approving the Mobile Virtual Network Operators (MVNO) framework could result in significant revenue losses for the government, particularly in the upcoming 5G spectrum auction, sources told ProPakistani. The framework has been pending with the Ministry of Information Technology and Telecom (MoITT) for several months and has yet to be sent to the Ministry of Law for vetting. Without its approval, mobile operators will not prefer to buy additional spectrum, as it cannot be allocated to MVNOs, raising concerns about the effectiveness of the 5G auction and the potential loss of millions of dollars in revenue. In June 2024, the Pakistan Telecommunication Authority (PTA) finalized the MVNO framework after consultations with stakeholders. The revised draft proposed 15-year licenses for MVNOs and reduced the license fee from $5 million to $140,000 to encourage investment in the sector. MVNOs, which do not own spectrum, operate by leasing network services from Mobile Network Operators (MNOs). The initiative was designed to expand mobile services, particularly in remote areas, and increase market competition. However, the prolonged approval process has stalled its implementation. Officials from the IT Ministry confirmed that the framework has been approved at the ministry level and will be sent to the federal government after vetting by the law ministry. Once vetted, it will move to the Cabinet Division, and further procedural approvals may be required before its final adoption. According to sources, after approval from the federal government and issuance of a gazette notification, PTA will start receiving applications. After completing the procedural process and legal formalities, the PTA will issue licenses to MVNOs, which will take even more time. Under the proposed framework, MVNOs will operate using MNO networks while managing their own branding, marketing, and customer service. They will be required to enter into commercial agreements with MNOs, which must be approved by the PTA. The regulatory authority will issue licenses once all requirements are met, but without final approval of the framework, the process remains at a standstill. The government has announced plans to launch 5G services in May or June, with the expectation of generating revenue from spectrum sales. The delay in the MVNO framework may stop telecom operators from buying additional spectrum, affecting the overall success of the auction. Any further delays may impact the effectiveness of the 5G rollout and limit the expansion of digital connectivity initiatives.