PTCL may close down Paknet for poor performance

The new management of Pakistan Telecommunication Company Limited is considering to close down its subsidiary Paknet due to poor performance and failure to deploy standard based infrastructure. Paknet has unsecured de-centralised billing system for its Internet services that is causing serious revenue leakage to the company.
Officials of PTCL held several meetings to sort out problems relating to Paknet operation. They also considered options to streamline Paknet functions as Internet Service Provider. But it might prove to be a tough challenge to reorganise it as it would need lot of money to upgrade the entire system.
According to sources, the PTCL subsidiary is also facing huge financial losses within the organisation, which have reached over Rs 100 million. Paknet is not in a position to pay such a big amount to its mother concern the PTCL.
The new management of PTCL is unhappy with its de-centralised system and is seriously considering its closure.
Furthermore, the customer support system is virtually non-existent, causing serious hardship to its customers.
In this regard, the PTCL has also placed a proposal to the watchdog telecom agency, Pakistan Telecommunication Authority (PTA), to allow the phone utility (PTCL) to start a dial-up Internet service, considered as an alternative option to its over 60,000 customers if in case they might close down Paknet. This has further deepened the situation towards closing down the Paknet, sources said.
Paknet, assigned to provide Internet services in the country, has been defaulting on account of various dues to PTCL since 2000.
In the past, the Paknet was unfairly protected by PTCL, creating a non-competitive environment for other ISPs in the private sector, thus compelling many local ISPs to wind up their business in many cities.
Due to this, the Internet services to many cities had to close due to monopoly of Paknet and unfair treatment of PTCL to other small private operators.
Paknet has a major advantage over other ISPs as the company uses the PTCL infrastructure and network throughout the country.
It has many 'Points of Presence' through which it provides internet services in various cities including Karachi, Lahore, Faisalabad, Gujranwala, Sialkot, Jhelum, Taxila, Hyderabad, Quetta and Sukkur.
The purpose behind the creation of Paknet was to provide a cheaper ISP dialup services in many remote parts of the country for the benefit of the end-users, but it (Paknet) failed to accomplish the task.
Paknet is providing Internet services which is not feasible particularly at remote locations due to the inadequate availability of PTCL infrastructure and no other ISP in private sector can operate.
Sources said that an amount of Rs 300 to 400 million would be needed for upgradation of Paknet and, for the present, the PTCL management has not allocated any budget in this regard.