We tend to agree with him. The last budget went overboard with the tax increase on telecom services. If an industry is doing well and is successful in bringing foreign investment to Pakistan (Wahab pointed out that Telenor alone invested $2 billion in last 3 years), let it work without the burden of unnecessary taxes.

There were other grievances as well. Irfan also said that his company was not against the quality surveying of the service providers but it should be transparent and impartial. I think Telenor did not do very well in the QoS surveys and there has been criticism of the way these surveys were conducted.

He appealed to the government to call a roundtable conference of all the service providers to get rid of the illegal sims being used for crime and the terrorist activities while the police action against retailers and franchisers should be stopped.

But alarmingly, similar restrictive price models are being introduced in the US. One of the large cable companies, Comcast has introduced this concept recently and it has not been received well by consumers and in particular, technical bloggers. Mind you the limit imposed by Comcast is 250GB which is a huge number when you compare it with the situation in Pakistan. However for the people who are used to unlimited broadband access it can be a problem. Consumers of high def videos are one set of users who can gobble up this kind of bandwidth very quickly. File sharing is another one. I’ll leave you with the reaction of blogger Om Malik:

Comcast will institute a 250 GB cap on its broadband connections starting Oct. 1. Expect other carriers to follow suit and make tiered broadband a reality. Much as I would like to think otherwise, this is the end of the Internet as we know it.

The caps are a move to ensure that the gouging scheme put in place by Comcast and other cable providers stays intact and they can continue to sell their video-on-demand services. It was a point I made when I wrote, Why Tiered Broadband Is The Enemy of Innovation. I will say this again: this is to stymie services like Hulu, NetFlix and Amazon On-Demand.

The days gone by when PDA’s (read Win Mo Mobile phones) were only meant for geeks & Techies, since than PDA’s have come to an age of unattractive looking communication devices to a fashion/ professional accessory. As the data consumption by local consumer is increasing (following the footsteps of their global counterparts) along with all kind of new data services being introduced by Telco’s. This scenario has now led to a sudden surge in demand for handheld devices to fulfill customer’s both (professional & style) requirement in a single mobile device.

Currently the local smart phone market entails 3 major players (OS/ platform plus devices). The Nokia smart phones (primarily its e-series with Symbian OS), RIM with its BlackBerry devices/ services & the Microsoft Windows Mobile enable devices (aka PDA’s) approx 80% of which manufactured by High Tech Corporation - HTC).

Why Windows Mobile?

For Individual Consumers:

1.     Great potential in business phone category with thousands of professionals are looking for the solution of their  professional requirements,

2.     Growing acceptance of Windows mobile as the foremost OS in business category,

3.     Plenty of choices (in the shape of different device manufactures) available in Windows Mobile, with different design choices (from a sleek stylish looking device to a professional looking full auto sliding keyboard built device) 

4.     A sudden surge in young executives segment in Pakistan, who want to fulfill both of their professional & style requirement through a single mobile device.

5.     Win MO offers loads of customization for each individual needs, cyber world is abundant with apps from Games to Touch navigation (finger swapping navigation) soft wares.

For Corporate:

1.     Growing trust on Windows Mobile by IT/IS departments of leading organizations.

2.     Windows Mobile offers High security & control  for organizations unmatched by other hand-held  devices,

3.     Data facilities from cellular operators are improving, which is now encouraging corporate organizations to modernize their business processes through utilizing these facilities.

4.     Advance level of connectivity now required by companies from their employees,

5.     Growing trend of Office automation through Hand held devices,

6.     MNC’s are being instructed by their foreign offices to switch onto Windows Mobile.

How to Promote Windows Mobile?

1.     Awareness: (through targeted, coherent & interactive communication)

2.     Reach: (through communication & sales channel)

3.     Experience: (connect Windows Mobile attributes with consumers hence enhancing brand image & build customer relationship)

4.     Value Proposition: (provide the rationale (tangible and intangible benefits) for making consumers choose Win Mo products over competition)

Communication Activities to Focus:

1.     ATL: ATL will help in awareness & hype of Win Mo devices. In addition, these media also give strength to Windows Mobile brand (esp. TV & Print in Pakistan)

2.     OOH: (Billboards only)

3.     BTL: BTL needs to be more aggressive through road shows & high-end in-store branding,

4.     Trade Marketing: Sales promotion, premiums, Win Mo device demonstration at select potential Malls & outlets,

5.     Corporate Marketing: Training workshop, Corporate giveaways, PR events, Win Mo enable units for corporate demonstration.

Conclusion:

1.     Windows Mobile has the required product portfolio & potential to make it big in Pakistan,

2.     If Windows Mobile or Win Mo devices adopt targeted & focused approach towards 2 most vital segments than the objective of higher number of Win Mo user in Pakistan can easily be achieved,

3.     The value of each segment (Individual & Corporate) is very important in taking Windows Mobile devices towards leadership position in high-end category,

4.     The upcoming products including HTC Diamond, Samsung Omnia, HTC Touch Pro & Sony Ericsson Xperia X-1have the potential to achieve greater success for Windows mobile in Pakistan.

This seminar was attended by many telecom celebrities of Pakistan including: the new PTA chairman Dr. Mohammed Yaseen, Telenor CEO Jon Eddy Abdullah, Saad Muzaffar Waraich, Country Director, Nokia Siemens Networks (NSN), Lasse Makinen, Member Global 3G Team - NSN, Irfan Wahab Khan, EVP & CEO LDI, Telenor Pakistan and representatives of MOITT, Warid, Huwawei & Deloitte.

By the way - can you name the personalities in the picture above (left to right)? Answer to be provided here in 2 days.

More about the conference from the press release:

The seminar was jointly sponsored by Telenor Pakistan and Nokia Siemens Networks with the PTA and Huawei Technologies co-sponsoring the event. The seminar was inaugurated and chaired by the Chairman PTA Dr. Mohammed Yaseen. He assured all present of the PTA’s cooperation and support towards the introduction of new technology and said that the PTA would soon be inviting applications for the 3G spectrum.

The industry strongly felt that in light of the extremely low Average Revenue per User (ARPU), a limited market for 3G and cut-throat pricing only a lowered 3G license fee and restriction of auction within the existing telecom operators would support a successful roll out.

“A professional looking guy is standing nearby you, he is pretty calm & collected but needlessly try to show of his latest PDA, few seconds forward than he pulls out his phone stylus & tap here & there on the screen than put the phone in his pocket while giving a good gaze to all the near by guys boasting a smirking proudly smile“.

I bet many of you have observed incidents like these but have you ever wondered why on earth a decent looking guy in professional attire can ever do this kind of antics.

To further explore this mindset, let’s look closely, the phenomenal growth in mobile penetration has created a very unique socio cultural psyche. Just imagine from a 12 year old kiddy to a 60 year old man are all playing with the small communication device known as mobile phone. A rough estimate suggests that in Pakistan the usage span of a new cell phone is mere 3 months (means majority of local users upgrade their cell phone within 3 months time).

Confused, let me throw a simple question. What exactly do you want from your mobile? The 3 top of the mind features which comes instantly should be the core reason for you to owning your current handset; if that isn’t the case than you must have lost the battle to the aspirations which are hiding somewhere underneath your mind.

Sound interesting right, precisely your honest answer is the basic premise of this article. Pondering further on this same concept, I have summed up the Pakistan’s mobile user into 2 main categories (2 basic types of users).

1. Those who are driven by their needs (read 3 core phone functionalities)

2. Those who are driven by their aspirations (Users who can easily suffice their communication requirement through a say Rs. 10k mobile phone but instead they choose to carry a cell phones worth Rs. 40K or more)

In every mobile phone user’s mind there is a battle going around, a battle between their needs & aspirations. Some own phones to suffice their communication needs while some own phones to meet their aspirational urges. 

Now look at the mobile phone user preference chart while making actual decision, the data is a study & I have used extrapolation for analysis purposes as it enable us to understand the psyche of local consumer. Also take a look at the chart depicting local consumer purchasing pattern.

I personally have come across so many professionals/ executives who take their hands on any new business phone which hits the market, to few of them I even asked the question why you are carrying a blackberry/ PDA or a latest Nokia E-series phone…. the only answer I got in reply was we need to check our emails 24/7 & that’s about it (surprisingly no words about PIM, one of the major feature of any business phone since majority of them doesn’t exactly know what this Personal Information Management really stand for). I have even tried to convince majority of them that there are cell phones which can meet your exact requirement in half of the price you want to spend but my efforts always go in vain.

The main reason lies in the consumer mindset (the aspirational value attached to carrying a business phone) since the consumer tend to believe that how he/she will look professional (read top executives) if they are not carrying a BlackBerry or a PDA phone.

And this is not just a local phenomenon; even mobile users of developed countries tend to be manipulated by their desires & aspiration rather looking to their actual communication needs. Hence this battle between needs & aspiration will continue…. how long, i am not too sure…

Signup was fast and easy. Localphone provides you a local number in your area which actually calls the number you want in Pakistan. Let’s say you are a Pakistani in Houston; you can get a local Houston number and that number will ring your home number in Lahore. You can specify the numbers from where you will be making calls (your home, mobile etc) and that’s it.

The Localphone.com website makes it real easy and convenient. I was up and running in a few minutes. A credit card is required to complete the registration. I have setup three local phone numbers for myself. Compared to the lengthy process of using calling cards, this is very convenient and the quality is way better than the cards offer.

I enjoy the convenience of making quick calls through a local number and the comfort of knowing that there are no hidden charges - all your call history is a click away. And you can earn credit by referrals - I have placed a link in the side bar so if you sign up through here you will be supporting the blog!

Cellular revolution has taken Pakistan by storm. As the mobile density in Pakistan is reaching 56%, it’s high time that we discuss the prospects of cell phone-based social revolution in Pakistan. Mobile phones are increasingly being used as a social tool across the globe - as a weapon for the eradication of poverty and disease and as a sustainable option.

Pakistani cellular companies are also trying to catch on with this growing ‘cellular activism’ frenzy. It’s true that cellular companies have limited scope of action as far as brining social change is concerned still almost all the mobile companies of Pakistan are doing some kind of social uplift projects. Telenor, for instance, has launched a farmers’ uplift scheme - TeleKisan - besides the apna PCO and other schemes. Similarly, other cellular companies are also conducting some activitis in the avenues of social uplift.

The responsibility, however, lies on the nonprofit sector and not just with the telcos. Non-profit organizations (NPOs) are the engines of social change in the developing countries. Mobile phones can be used as a foot soldier for social change if their use is extended beyond communications. NPOs can team up with the cellular companies to help providing technical knowledge to the farmers (National Rural Support Program is collaborating with Telenor in this case) or they can forge alliances with the medical community to provide free medical advice to those living in far off areas with limited resources. Some African nations are already making it big in what can be termed as cellular farming. The role of mobile phones in fighting against HIV/AIDS has already been discussed in one of our earlier posts.

Asia is not lagging behind as well. The success of Grameen in mobilizing people through ‘mobiles’ is known to all of us. Other networks like LIRNEasia are also doing commendable job in changing people’s lives by the use of cellular technology. International donor agencies are also eager to work with such organizations like LIRNEasia. Infact they are financing the whole project.

Microcredit organizations, as discussed above, are rapidly adopting cellular technology to enhance their footprint. Mobile phones are yet to be used for microfinancing in Pakistan though there are endless possibilities. To narrate an interesting fact, many small entrepreneurs, including women, have themselves understood the magic of cellular technology in expanding their businesses. They do face the shortage/availability of funds due to lack of financing but the cell phones are surely helping them in getting out of the tentacles of poverty.

Corporate sector too has a major role to play. Instead of simply doling out a few millions in charity, local corporate giants, along with the multinational conglomerates, should come forward with new ideas of using cellular technology for poverty alleviation. It’s ironic to note that when the whole world is eyeing profitability at the bottom of the pyramid by using cell phones, Pakistani corporate sector is still reluctant to accept the change. Cellular technology is ruling the roost so isn’t it the time to ‘cell’ the social change.

Handset market has played the most pivotal role in the overall growth of Pakistan’s telecom industry. For me the handset market has played a kind of un-sung hero role in-comparison with the local Telco’s who have taken much of the limelight in the phenomenal growth of Pakistan’s telecom industry during these 6 years.The 1st H of 2008 was a difficult period for telecom industry in general with plenty of political uncertainty, negative economic indicators, ever rising inflation & unfavorable budget policies played their role in restraining the growth pattern of previous years.

The hardest hit area in this declining growth pattern has been the handset market of Pakistan. Till Dec, 2007, the growth of handset market was excellent with around 1 Million handsets were being sold on monthly basis. However in July, 2008 the figures came down to 600 K units per month (depicting 40% decline in volume during 6 months). While the picture looks grim, i am pretty sure that volume will start to pick once the clouds of uncertainty settles (positive indicators including decline in inflation & Pak rupee getting strong against $).

Handset Market - Current Scenario

Pakistan’s handset market is primarily a low-end market with majority of volume comes from low-end mobile phones. Another important aspect is that our handset market is extremely price sensitive just like any other handset market of a developing country.

To comprehend the local market dynamics, below is the price segmentation analysis along with the market share each price segment comprised upon.

If we look at how the current market stands with respect to market share of each handset manufacturer, Nokia still has a sizeable lead though their market share has been deteriorating steadily (from 65% in 2006 to 48% at the end of July, 08). The progress of Samsung has been phenomenal from 8% market share in 2006 to the current 30% with indication of further progression in 2009. LG is the second biggest gainer (approx 17% share for a player who has just been active since 2 years) with most of the success came from its 2 successful models LG KG195 & KG270. Sony Ericsson & Motorola represent 2 of the biggest loosers in the handset market with only 5% & 1% share in the total pie.

I believe that these figures might be shocking for some people, since in Pakistan most of the guys still think Sony Ericsson is the second major player in the Pakistan’s handset market which isn’t correct any more… As I mentioned earlier Pakistan is primarily a low end market with approx 63%-65% volume generates from phones worth less than 3k & if you look into SE local product portfolio you will not find a single SE model in this price range, strangely enough their majority of portfolio compete in a price segment (High-end) which is just a mere 5% of the total handset market.

Motorola is just vanishing in Pakistan, the disaster of their F-3 model started a vicious slide from which they never recovered with the future seems more bleak.

The Koreans are playing their cards really well with the success of both Samsung & LG they are really flying high. Especially the success of Samsung is very impressive with a very strong portfolio (the most balance portfolio in the industry covering all price segments with good products). This success in Pakistan has come down from the global success Samsung Mobile has been enjoying from the start of 2007. Their flagship model SGH C-160 targeting the low-end category is making waves in the most lucrative (volume vise) price segment in Pakistan’s handset market. With more emphasis on R&D & product development the future looks bright for this giant conglomerate.

LG has also succeeded really well through getting direct benefit from the absence of any substantial products by SE. But the question mark on the product quality is hurting the brand to grow exponentially; I believe that they need to work very hard in building their brand image (development of high perceived value through High-end Flagship model) as LG still has very low brand image in comparison with the competition.

Nokia, the global leader in the world is still the player to beat in Pakistan’s handset market with the resounding success of Nokia 1200 & 1208, this global giant has so much to offer in-terms of quality products. In Pakistan, Nokia plays a major role in 3 main price categories (Low-end, Low Mid & High) which comprised upon 82% of the total market.

The report provides a concise and fact-based overview of the economy, telecom road map, regulatory environment, telecom infrastructure (broadband, international connectivity), licence and spectrum situation, investment landscape, mergers and acquisitions and of course - the opportunities, as the excerpt below shows:

All this signals opportunities in the Traditional and Value Added sectors for not only creating new businesses by riding on these systems but also to be a part of new licenses which are being reviewed. These include MVNO, Regional Hosting, Call Centers, Telecenters, Video Conferencing, Content aggregation, Converged networks, etc. On another plane, the Regulatory environment permits spectrum trading, Mergers and Acquisitions as well as entry via Private equity arrangements. The market opening has nearly doubled the sector revenues and this trend is expected to grow.

The annex has a list of licensed operators as well. Obviously this an evergreen document and one should keep in mind that the numbers represent Aug 2007 and have changed during the last 12 months.

Developers will be able to make their content available on an open service hosted by Google that features a feedback and rating system similar to YouTube. We chose the term “market” rather than “store” because we feel that developers should have an open and unobstructed environment to make their content available. Similar to YouTube, content can debut in the marketplace after only three simple steps: register as a merchant, upload and describe your content and publish it. We also intend to provide developers with a useful dashboard and analytics to help drive their business and ultimately improve their offerings.

I love this apple vs microsoft vs google race because it will be great for consumers and developers. Finally the phone companies get what they deserve.

If you are an android developer and want to discuss some of your app ideas, feel free to reach out to me.