KARACHI: Pakistan Telecommunication Authority (PTA) has decided to introduce price floor regime for mobile broadband services, in order to address the issue of unhealthy competition and protect and maintain the profitability of the telecom sector. The regulatory body has planned to set minimum level of retail prices for mobile data and broadband services, while the minimum mobile broadband speed would also be realised upwards. In this regard, PTA has sought consultation from all telecom users, stakeholders, interested persons and the general public requesting them to submit their comments on the issue. “The current pricing mechanism under intense competition among mobile operators was not sustainable for a longer term. Resultantly, it may slow down investment in the broadband network, which was required continuously to meet the quality of service standards and bandwidth requirements of 3G and 4G and other digital services,” reasoned PTA in the consultation paper. PTA has also received a request from one mobile operator to regulate prices of data services with the objective to ensure increasing demand of consumers for enhanced mobile broadband services, while preventing potential market failure. “If the regulator sets floor price for data services, it would be a win-win situation for everyone involved as it would pave the way for cellular operators to improve quality of service and consumers could get seamless mobile internet connectivity,” said a senior telecom official. He said that the telecom companies invested heavily in licenses, but there was no extension in 3G and 4G network roll out and the foreign direct investment (FDI) in telecom sector has been declining mainly due to slow return on investment (RoI) ratio. “Regulating the data tariffs was a viable option to support struggling telecom industry as it would benefit all, consumers would have better services, operators would have improved profits and the government would have strong revenues in terms of taxes,” added the official. PTA said there was an intense price war among operators for provision of data services even in the nascent stage of the mobile broadband data proliferation. This situation has led unlimited pricing offers and promotions resulting in consumers to make impulsive decisions without considering and comparing with other packages, lesser incentives for operators to invest in their networks and acquire more spectrums from time to time in order to meet the quality of service and bandwidth requirements of accelerated digitalisation, PTA elaborated. Also, there has been general increase in the price of goods and services owning to inflation and other factors, while mobile communication was the only sector in Pakistan which has witnessed constant decline in prices and tariffs owing to technological advancements and price wars. Therefore, it becomes imperative that appropriate action in the form of minimum price should be initiated to bring stability in the broadband market, PTA added. The telecom regulator, highlighting the benefits of proposed mechanism, said it would lead to introduction of healthy and competitive regime and would enhance the quality of service that satisfies growing needs of the consumers with specific reference to digitalisation of services. “Introduction of price floor regime would increase confidence of the consumers in use of mobile broadband by reducing free access with potential non-social use of social media and channelizing the youth in a more creative direction. Also it would ensure long term sustainability of the telecom industry in consultation and collaboration with all stakeholders including consumers, government and operators.”