Pakistan Telecommunication Authority (PTA) is all set to amend the licensed area/jurisdiction of Data Class Value-Added Services (CVAS) from nationwide/province to district level.

It is expected to generate additional revenue of around Rs. 3 billion and create thousands of jobs by expanding internet connectivity to smaller towns and villages across the country.

Official sources told ProPakistani that around 5,000 people have shown interest in acquiring the Data CVAS license at the district level, which is a comparatively simplified entry-level license for the provision of internet services in the country and increased broadband proliferation.

Sources said that over two decades, significant changes have unfolded in the market dynamics and technological landscape, reshaping the environment profoundly. These advancements have rendered the existing scope of the Data CVAS License not to correspond to the evolved technological shifts.

Therefore, a revision in the Data CVAS License for the provision of Internet
services in the country is imminent.

Furthermore, startups, entrepreneurs, and young technical graduates showing keen interest acquire small area licenses beside Cable TV operators who are interested in offering quality internet services utilizing their current OFC infrastructure, established under PEMRA’s Cable TV license.

However, under the prevailing regulatory framework, they are obligated to acquire FLL licenses from PTA for such services. Nonetheless, they exhibit reluctance towards pursuing FLL licenses due to the compulsory requirement of providing voice services and associated obligations tied to FLL licenses.

According to the proposed template, the Licensee shall provide Licensed Services to the End Users by acquiring access/IP Bandwidth from the Local Access Provider (LAP) and last-mile infrastructure acquired from the Local Access Provider (LAP) or Infrastructure Licensees (IL) Or last mile infrastructure established under its own ‘Cable TV Distribution’ License issued by the Pakistan Electroni
c Media Regulatory Authority (PEMRA).

Further, the Licensee can lay down its own purpose-specific transport/Local Loop infrastructure just for providing Licensed Services, after three months of failure to obtain the desired infrastructure from any existing LAP or IL, subject to prior approval of the Authority. Provided that the licensee does not hold PEMRA’s Cable TV distribution license.

According to the current regime, the jurisdiction/licensed area is nationwide and province while it is proposed to have only one district-level CVAS license by one company.

Further, the current term of the license is 15 years which is proposed to reduce to 10 years. The application processing fee is currently Rs. 5,500 and is proposed to be Rs. 20,000 in the amended regime.

The initial licensee fee nationwide is Rs. 300,000 and Rs. 100,000/50,000 for the province and it is proposed to be Rs. 300,000. Annual License Fee (ALF) is currently 0.5 percent of Adjusted Gross Revenue while in the revised regime it would be Rs. 10
0,000 for the first year, with an increment of 10 percent for each subsequent year.

This License makes it mandatory for the Licensee to establish ‘Service Level Agreements’ (SLAs) with LAP and/ or IL, for Access/ IP Bandwidth and last-mile connectivity.

All such SLA shall be approved by the Authority before the commencement of Licensed Services and SLAs for such network transport contracts shall include the minimum following conditions:

Scope of the Agreement i.e. Access and/ or Infrastructure

Area

Pricing Mechanism for Services – Access and/ or Infrastructure

Maintaining the Quality of Services (QoS)

Dispute Resolution Mechanism

Force Majeure.

A deep analysis reveals that this will put a check on illegal band selling to cable operators, the opportunity for small investors to have technical know-how, fixed broadband proliferation in rural areas, etc.

These operators if grow their business and desire to expand the network to a second district, will be required to obtain a Local loop license. Thus ove
rall will expand the FTTH services from 3 million to approximately 10 to 12 million users within a short span.

Source: Pro Pakistani