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PTA asks internet providers to reduce prices

The Internet Service Providers Association has asked the Pakistan Telecommunication Authority to take equal responsibility during the coronavirus outbreak
by TR Pakistan

The news: The Pakistan Telecommunication Authority (PTA) has asked internet providers in Pakistan to offer reduced pricing and affordable internet packages to customers during the Covid-19 outbreak.

The directive: According to Dawn, the PTA wrote a letter to the Fixed Line Operators (FLO) on Thursday and encouraged the operators to provide cheaper internet packages for users considering the increased demand during country-wide lockdowns. Pointing towards directives given in Section 4 (1) C and 6 (F) of the Paki­stan Telecommunication (Reorganisation) Act 1996, the PTA instructed service providers to create low-priced internet packages that allow users to get a 2 Mbps speed with a 40 GB data limit for less than Rs.600 per month. These packages can provide relief to the public as they stay home and conduct their office or educational activities online. The letter also encouraged the operators to provide an extension in billing dates and allow users to pay their bills later than usual.

‘PTA’s responsibility’: In response to this letter, the Internet Service Providers Association of Pakistan (ISPAK), said that the PTA should take equal responsibility in providing relief to the masses by providing subsidies for the Internet Service Providers (ISPs) and taxation should be relaxed if not eliminated. ISPAK convener Wahaj us Siraj wrote in a letter, that the PTA is simply trying to avoid responsibility. Service providers that offered low internet rates and special packages during the coronavirus outbreak in other countries had been fully supported by their governments. He said that the package proposed by the PTA was “irrational” as a 40 GB data limit would be reached within a few days. Siraj explained that the service providers themselves were facing harsh consequences of the outbreak such as a rise in operational costs as they ensured the safety of their employees and loss of business as the corporate sector had shut down. He pointed toward the increased internet usage across the country which has prompted the ISPs to purchase more bandwidth from upstream providers.

Cost calculations: The ISPAK has been demanding the PTA to delink the cost of bandwidth with US dollars for several years and called for action on the matter. They also advised the PTA to eliminate 12.5% advance income tax and 19.5% provincial sales tax from internet services, which would provide a direct 32% relief to their customers. While cellular companies in Pakistan have provided special offers for users due to the ongoing lockdowns, the ISPAK’s letter to PTA stated that there should be no comparison between cellular companies and FLOs. “Deployment costs of FTTH is 30x of a cellular customer. There is no upfront cost of a cellular operator in connecting a new customer whereas FLOs installation cost for one customer is around Rs10,000,” it said. The PTA had recently commended the efforts of cellular service providers and other companies in combating the Covid-19 outbreak in a statement.