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Cellular firms under fire due to poor services

* Resolution passed in PA seeking ban on night call packages

By Muhammad Yasir

KARACHI: The cellular phone companies have come under fire by the concerned authorities due to poor services and anti-competitive practices.

The cellular phone operators, who have been adding subscribers to their network, have been subjected to grilling one after another by Pakistan Telecommunication Authority (PTA) and Competitive Commission of Pakistan (CCP) in the last three months. Besides, a resolution was passed by the Punjab Assembly seeking a ban on night call packages of these firms, which they determined as harmful for the youth.

Top brass officials of all five operators have recently been slapped 24 show cause notices by the CCP on the cartelisation and price fixing following an investigative inquiry.

It is although no doubt these operators are declining the calls and SMS rates due to the visible unending price war among market players, but it is also true that they rarely impose charges on their telephony services and whenever they have slapped or increased rates, they have done it jointly and sometimes covertly leaving no option for millions of customers for any other choice.

In the last two years, almost all cellular phone companies levied three major charges that included 100 percent hike on the calls to the respective customer care centre, 5 percent service fee on balance recharge, and 10 paisas deduction on balance inquiry through SMS, which is frequently done by customers.

Last year in October, almost four out of five operators levied 12 paisas including 2 paisas general sales tax on every attempt of balance inquiry through SMS. The government withdrew an additional 20 paisas tax including 19.5 percent federal excise duty on each SMS proposed in the Federal Budget of 2009-10 owing to high public demand and request.

On October 1, 2008, all these companies imposed 5 percent services charges on the balance recharge through upload and scratch card. If a pre-paid customer recharged his/her balance, then it paid 5 percent service charges to its mobile operators on every move. Same conditions apply to post-paid customers.

In December the same year, these companies hiked 50 paisas per minute call to their customer care centers, which is now Re 1 per minute including tax.

Calls to customer centres are also made frequently particularly in order to subscribe for value-added services (VAS). So these, tactics enhanced operator’s income handsomely by deducting customers’ balance.

Last year particularly on the occasion of Eidul Fitr, the cellular phone companies’ tall claims of services and rates became false as they suffered from busy networks, unannounced suspension of SMS bundles’ deals and balance upload particularly for a couple of weeks.

PTA also received hundreds of complaints about bad network coverage in the last couple of months, however, its testing mechanism to assist services quality of operators was also unsatisfactory. Therefore, the telecom watchdog sent show cause notices to all of the five operators for their bad quality of services to the customers in December 2009.

Last but not the least, the lawmakers in the Punjab Assembly demanded immediate ban on the night call packages, which can cause huge revenue loss to the cellular firm.

The total number of subscribers base reached 97.57 million by the end of December 2009 with teledensity increasing to 59.60 percent

Mobilink is the leading market player with 30.8 million by December 2009. Telenor also retained its position in the market with 22.5 million. Warid, Ufone and Zong’s subscribers stood at 18.84 million, 18.51 million and 69.2 million, respectively.

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