Warid Telecom to launch services in Pakistan from April
Pakistan Times Business & Commerce Desk

ISLAMABAD: A new cellular phone operator in the country, Warid Telecom would launch commercial service from April this year with an estimated investment of around US $ one billion in three years.

"Initially we plan to launch our services with 1.5 million network capacity from 25 cities in all regions of the country with an investment of US $ 160 million," said Chief Executive Officer Warid Telecom Hamid Farooq in an interview on Sunday.

He said the amount of initial investment will be spent on customer care, billing and other operational expenditures including setting up of offices across the country.

Hamid said the service network will be expanded to other 50 cities in second phase with an investment of US $ 700 million by December 2005.

In the second phase, he said, 1.5 million additional capacity would be added in the network, reaching the total capacity to 3 million.

Answering a question, he said, they find telecom market in Pakistan vibrant and promising with modest and even estimates for foreign direct investment of several billion US $ in the next five years.

"We expect that the mobile phone penetration can rise from 5.5% to 18% in the next 4-5 years," he said.

Answering a question, he said, Warid telecom will be providing 1500-2000 direct employments all over Pakistan. Indirect employments through 200 franchises will be around 4000 and indirect freelance sales and retailers will be much larger.

In the Long Distance International (LDI) sector, he said, the company plans to launch the services in all regions ahead of its cellular services by March 2005.

Answering a question, he said, the low tele-density was the main sources of attraction for them to invest in telecom sector in Pakistan.

"Warid Telecom, a UAE based group, would also consider other potential areas of investment like property development, housing and insurance in Pakistan," he added.

He pointed out the company had already paid US $ 145.5 million as 50 % of the total US $ 291 million license fee to the 1government of Pakistan while the remaining amount would be paid in 10 years time.

"We will never compromise on quality of service. Quality of service will be our priority," he said in response to a question. Keeping the untapped population figures and economic factors in mind, Hamid said, he believes that the number of the telecom companies is not very high."

"However, if we only focus on the per capita income level, six operators do look as a high number especially at a time when Wireless Local Loop (WLL) and Local Loop (LL) are also being aggressively promoted."

About the role of PTA, he said, in recent years Pakistan has witnessed a strong, progressive and fair regulatory environment and the role of PTA has been very encouraging towards the achievement of ambitious goals set up in the telecom policy. 

PTA has consulted all local and foreign players, while introducing the reform measures and this has increased the level of confidence of local and foreign investors, he added.

He suggested that PTA and other government authorities should carefully monitor the quality of service levels being maintained by the incumbents.

"We also expect PTA to establish and maintain a fair and balanced pricing mechanism so as to discourage the anti-competitive practices by the incumbent operators," he said.

When asked how will WLL and LDI compete with PTCL and the mobile operators, he said WLL is good when it comes to expanding the telephony services to the far-flung areas, where fixed telephony doesn't exist.

But WLL may pose a threat to cellular and fixed telephony operators operating in large cities and urban areas.

The company, he said, has also procured license for WLL in certain regions in the 3.5 GHz band. There is going to be a potential threat of WLL to the mobile operators, at least in the densely populated areas.

"It is extremely important that WLL should not be allowed to be used as a back door entry into the cellular business and PTA may ensure that the WLL handset on a particular cell site are not allowed to roam on the networks other than its home cell site.

Keeping in view the increasing competition in cellular market, he said, the airtime tariff and other mobile charges would reduce further.

Despite these factors, he said, the current mobile subscriber strength is expected to increase almost 15 millions from the prevailing 8.2 million subscribers by the end of the year.●