The Pakistan Telecommunication Authority (PTA) is set to introduce 15-year licenses for small telecom companies to operate as Mobile Virtual Network Operators (MVNOs). Unlike traditional Mobile Network Operators (MNOs), MVNOs do not own any spectrum; instead, they provide mobile services by utilizing the networks of established MNOs. This initiative aims to attract investment and enhance mobile services in remote areas of Pakistan.
To achieve this, PTA has drafted a revised MVNO framework after extensive feedback from industry stakeholders. The draft is currently available on the PTA website and open for further comments for the next 14 days before finalization. In response to industry feedback, PTA has proposed a significant reduction in the MVNO license fee from $5 million to $140,000. This considerable decrease is expected to stimulate investment in the MVNO sector, allowing smaller companies to enter the market and offer their branded services through revenue-sharing agreements with MNOs.
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According to the draft, MVNOs will have the flexibility to enter commercial agreements with one or multiple MNOs. They will be able to use their own brand names, marketing strategies, and customer care services, although they cannot install any radio or core network equipment. MVNOs can also offer customized services in addition to those provided by their parent MNOs. While PTA will not interfere in the commercial agreements between MNOs and MVNOs, it will issue licenses once all requirements are met. PTA approval is mandatory for the initial agreement between an MNO and an MVNO, and any subsequent changes require prior approval. The framework emphasizes the importance of service quality, holding MVNOs responsible for ensuring high-quality services under their brand names and marketing their own SIM cards. MVNOs must also guarantee uninterrupted services from their parent MNOs.
From a financial perspective, parent MNOs will be responsible for paying all regulatory fees and contributions based on the combined revenues from both MNO and MVNO services. Additionally, MVNOs will pay annual numbering charges through their parent MNOs.
The initial license term for MVNOs will be 15 years, with the possibility of renewal. However, if the agreement between an MVNO and an MNO terminates, the PTA will also cancel or suspend the MVNO’s license. The PTA’s initiative to offer 15-year licenses to MVNOs and significantly reduce the licensing fee is a strategic move designed to improve mobile services and promote investment in Pakistan’s telecommunication sector.
