An interview with ICT expert Parvez Iftikhar'Government must facilitate operators to keep Internet running during coronavirus'

Amid the chaos of COVID-19, information and communication technologies (ICT) have come to the rescue of individuals, families and businesses across the world. BR Research spoke with Parvez Iftikhar, a prominent ICT expert, to get a better sense of the situation on the supply-side and the demand-side of digital services in Pakistan and how best to leverage ICTs in these testing times. Parvez is the founding CEO of Pakistan’s Universal Service Fund (2007-2011), which is a public-private telecom development organization. Previously, he also served as the country head of Siemens Telecom, Pakistan. After leaving USF, Parvez has been active in ICT policy advisory, consulting for organizations like the International Telecommunication Union, USAID, CTO and the World Bank in various countries of Asia and Africa. He is currently also a Member on the PM’s Taskforce on IT & Telecom, heading its Telecom side.

BR Research: As more and more people are staying indoors around the world to help limit the spread of COVID-19, multinational operators like Vodafone are reporting big jumps in data usage in some markets. Do you see Internet usage increasing in Pakistan as well?

Parvez Iftikhar: According to one Pakistani operator, compared with the Internet traffic of Monday 24^th February (the day after the first coronavirus patient was detected in Pakistan), the traffic of Saturday 28^th March showed an increase of 22 percent. According to another operator, in the last 10 days, the traffic has increased by 16 percent. And it is going to rise even faster. This is despite the fact that the corporate usage has gone down slightly.

The traffic density in some parts has grown more than the others. The old ‘hotspots’ of traffic are moving. The reason I say ‘are moving’, and not ‘have moved’, is that it is an ongoing process, just as the lockdowns are gradually unfolding in their severity. Clearly, the increase in usage is seen mainly in the data, and not so much in voice. This is because, nowadays, even for voice calls people use data services like WhatsApp.

All this shows greatly increasing internet usage in Pakistan. If this abnormal increase in data usage continues, it could result in degradation of service that can impair the fight against COVID-19.

BRR: How valid are concerns that coronavirus may break or crash the Internet as a result of surge in data demand owing to teleworking and video streaming? In Pakistan, do you think there is plenty of redundant broadband capacity to meet surge in Internet usage?

PI: If the lockdowns are more strictly enforced, or continue longer for more than a couple of months, then such concerns start becoming valid. The streaming services are already being throttled to some extent in order to prevent overall degradation in service.

There is a limit up to which the installed networks can be enhanced through “soft” measures, i.e. without adding any hardware. However, with ongoing lockdowns, it may soon happen that installed hardware runs out of capacity. That would mean time-consuming import of new equipment, and then physically going to the sites and upgrading the hardware. Due to the lockdowns, going to some of the locations itself is an issue.

In the meantime, availability of more spectrum with the operators could help. Beyond a certain level, the mobile broadband service provider must either have more spectrum or build more towers. Successive governments, including the present one, in Pakistan have not handled the issue of new spectrum seriously.

Another concern is lack of capacity in the backhaul networks. In Pakistan, most of the backhaul is carried on microwave radios, which have a limited data carrying capacity. Soon we are reaching a stage where we will need more optic fiber links, at least in some high-traffic zones. Pathetically, less than 10 percent of towers are connected with fibers in Pakistan. Thanks to myopic policies of various organs of the State, the deployment of optic fibers has been hindered due to expensive and cumbersome procedures of getting Right-of-Way (RoW) permissions.

Thus, the redundant broadband capacity is there, but it is certainly not plenty.

BRR: What steps can be taken to ensure smooth functioning of the Internet during the anticipated duration of this crisis?

PI: Well, the initial steps that are being taken by the operators are the so-called ‘soft’ expansions. Steps like shifting the available spectrum from Voice to Data (called “re-farming”), enhancing software capacity of the installed equipment (some extra capacity is always in the design for unusual situations), adding hardware (cards) to the existing equipment whenever available, re-adjusting the radio antennae, etc. Incidentally, all of these activities require travelling by the staff, either to Network Operating Centers or to the tower sites.

The way the traffic is increasing, a time will soon come when these efforts will reach the ultimate, and bigger steps will be required, like importing new equipment, erecting new towers, laying new optic fibers, etc.

The government must facilitate operators to keep Internet running during coronavirus by taking some important steps in that regard: ease the import of new equipment; waive off the customs duties/taxes on ICT equipment (at least during this time); change the process of granting Right-of-Way to a single-day process against a fee that is cost-based; allocate additional spectrum to mobile operators free of charge, or at a nominal cost, for the time being. In any case, large chunks of spectrum are lying unutilized, serving absolutely no purpose.

Unfortunately, in our country, the fear of NAB prevents many honest and upright professionals in the government to take such decisions, as these would be difficult to explain to non-technical experts later on.

Another thing that could be done is to push PTCL for a drastic cut in the price of wholesale international bandwidth. Internet service providers buy wholesale international bandwidth primarily from PTCL. Admittedly, it would make a small difference but it will allow the operators to enhance the volumes and speeds of Internet packages to some extent. The downside could be that PTCL runs out of capacity. But with the current rapidly-rising demand, that is going to happen anyway.

BRR: Do you think that the local telecom and Internet players are prepared for a crisis where their essential workforce is available to ensure round-the-clock services for clients in healthcare, banking, and other critical sectors?

PI: If you look at it, nobody, I must repeat nobody, was prepared for a crisis like this. Having said that, the performance of our Internet and telecom players, so far, has been brilliant. There has been no rise in complaints of outages and long troubleshooting periods, despite the challenges of having to put their lives in danger, and a part of the workforce, perhaps rightly, preferring to stay home.

It is the government that has to ease the movement of ICT workers during lockdown periods. The overzealous law enforcers do not always distinguish between those who are out for fun and those who have to perform critical functions. And this includes those individuals who work for software development companies and in call centers. This is despite the instructions from the Ministry of Interior warning law enforcers on the streets that “… restriction on the essential operational movement of the telecom operators’ staff may cause communication service outage for critical users …”.

Thanks to our telecom and Internet workforce, despite all the obstacles, we Pakistanis are freely using the Internet. It not only helps the services like healthcare, banking and others, but also helps the people stay at home by providing them the opportunities of working from home, transacting from home, remaining in touch with their near and dear ones, and entertaining themselves through multimedia online content providers. Our telecom and Internet players deserve a great round of applause for extraordinary performance during the crisis.

BRR: At this stage, is there a need to route Internet capacity from major business districts to residential centers, given that residential areas may drive usage in the near term as people work from home and consume more digital content at home? How easy or difficult is it to achieve this kind of substitution?

PI: Internet and telecom service providers keep on adjusting the Internet capacity as and where required, depending on what pattern the traffic is showing. This is mostly done from the Network Operating Centers (NOCs). For instance, with the highways closed for passenger traffic, all the voice and data traffic originating from moving cars and buses on the highways has almost disappeared. But the same users would be originating traffic from other (fixed) locations. If the internet traffic at any spot increases beyond a certain level, it becomes a “hotspot”. Over time, these hotspots may keep on appearing and disappearing at various locations, and the NOCs keep on making adjustments accordingly.

Depending on the available installed resources, enhancing the capacity in some cases could be a small exercise that may be handled remotely, while in others it may require physical intervention. In the latter case, any restrictions on the movement of the staff of such an essential service add to the difficulty.

BRR: Fixed broadband penetration is far lower than mobile broadband penetration in Pakistan, just as in India. Fixed broadband is generally faster, cheaper and more reliable than mobile broadband. Do you see this lopsided structural dynamic as a problem in ensuring smooth provision of Internet to Pakistanis as their reliance grows more and more?

PI: It is true that fixed broadband penetration is lower in countries like ours, and that fixed broadband is faster, cheaper, and more reliable. But this problem is not particularly related to the current situation arising out of COVID-19 pandemic. It is indeed a lopsided structural dynamic, but general in nature.

Interestingly, as our data consumption increases, even the mobile broadband needs more and more fixed backhaul. Eventually, the component of fixed network is going to become so high that future networks, like 5G, will not look like today’s mobile networks.

We must create policies and conditions to support fixed networks. For that, investments in fiber have to be made. Obviously, the government would not have enough resources to do it, neither is it required to do it. For this, the private sector investors have to be incentivized. Fiber networks are capital-intensive with very slow returns, and thus if the incentives for the investors are substantial, they would be worthwhile.

For example, issues related to the cumbersome procedures and exorbitant fees charged for granting Right-of-Way to telecommunications service providers have not allowed fixed broadband to become more prevalent in Pakistan. Instead of helping, in October 2019 the Ministry of Energy revoked the permission to string optic fiber cables along the electricity poles of the DISCOs. This permission had been available with the operators since November 2004. Obviously such measures hinder smooth provision of Internet to Pakistanis.

BRR: Based on evidence from worst-hit countries, it appears that the spread of COVID-19 is in its initial stages in Pakistan. In what ways do you think ICTs can help the government authorities in mitigating the health concerns and economic fallout from this crisis over time?

PI: One of the basic ways that ICTs mitigate the health concerns is by keeping the people indoors, which is one of the biggest prerequisites to control the pandemic. The extent of the help that ICTs are providing to the government authorities is practically immeasurable.

It is only through mobile phones that it has been possible to trace potentially infected people, and those with whom they had come into contact, then to reach out to hem and test them. Similarly, mobile phones can be used to monitor confirmed patients who have been advised to remain quarantined in their homes, to prevent hospitals from overflowing. For example, the government is making use of the Internet even in efforts like creating the PM’s Volunteer Force, and in identifying those who deserve financial and other assistance at their homes.

Although telemedicine has not become very popular so far, many citizens are now using Internet and their mobile phones to get medical advice on ailments other than covid-19. With the transportation closed, tourism closed, factories closed, offices closed, stadiums and cinemas closed, the only hope of keeping the healthcare services and the economy going lies solely with the ICTs. Whatever economic activities people can carry out from home, are possible only due to ICTs.

BRR: Which areas of the digital (on-demand) economy do you foresee helping the households in managing their lives during this crisis?

PI: One big way the digital economy, whose usage is slowly growing in Pakistan, helps is in getting the daily-use items delivered at the doorsteps of the households. That is the reason that in the coronavirus-hit West, on one side a large number of people are losing their jobs, but on the other side the retail stores – online as well as physical – are hiring massively for delivery of shopping items to the households. Amazon alone is hiring over a hundred thousand workers. Then, wherever public transport is shut, the likes of Uber and Careem come to help.

Yet another important help by ICTs is in bringing people closer to collaborate and make a difference. For example, Umer Hussain, the owner of a food chain ‘Sweet Tooth’, announced on Facebook that he was making low-cost protective clothing for healthcare workers in his living room. He asked for help, and soon he was flooded with offers of help. This is just a small example of how massive the impact of digital can be.

BRR: For all that scope, the benefits of digital economy may be limited in these times, as there is a high degree of financial exclusion and digital exclusion in Pakistan. Is there anything at all that the government can do in the interim to bring the excluded population into the digital net?

PI: Yes, the government is always in a position to do that. One way is to make Internet devices and services more affordable. Although the Internet services in Pakistan are relatively reasonably-priced, the Internet devices are not. It would also help if the financial transactions over the Internet/mobile would not attract any excise duties and taxes, at least till this crisis lasts.

The government can bring many people out of financial exclusion by making all State disbursements – such as those under the Ehsaas program – exclusively using digital financial services. Another problem the government should address is that the workers running mobile financial services face the same difficulty of restrictions in movements as mentioned earlier.

BRR: What kind of a financial impact do you think this crisis will have on the financial health of telecom companies in Pakistan?

PI: Sadly, with probably the lowest ARPU (Average Revenue per User) in the world, the financial health of telecom companies in Pakistan has not been very envious. So I think the main financial impact on the health of telecom companies will come due to further slowing down of the national economy. Ironically, the reverse is also true. The more the telecoms are negatively impacted, the more the economy will suffer. It is a vicious cycle.

However, there is some consolation. The telecommunication businesses are not among those that the coronavirus will bring to a halt – quite the opposite. Therefore, the telcos’ loss may not be as high as losses for factories or companies producing tangible goods that cannot sell due to the shutdown.

If the government does not provide some interim relief to the telecom companies, any issues arising with service provision of telecom companies will result in losses in every field of activity, which includes the fight against coronavirus itself.

BRR: In the end, are there any lessons for the industry and the telecom authorities based on early experience from this crisis?

PI: Both sides – telecom companies as well as the government – will have to take unusual steps to help the citizens and the country in these crisis times.

Although the companies’ workforce is already putting their lives at risk by striving to provide uninterrupted services, despite enormous pre- and post-corona challenges, the owners of the operators perhaps need to do more. Just like many operators the world over are doing, mostly offering free data up to certain limits. In addition, they can also extend the validity period of customers’ mobile prepaid lines, provide free access to selected e-Learning and e-Collaboration tools/websites, make mobile money transfers free of charge, and boost internet volumes and speeds, etc.

On the other side, the government could also learn from other countries and make more spectrum available, make it free for the time being, remove duties from any urgently-required expansion equipment, and ensure smooth movement of ICT workers. Just like a realization is sweeping that we, as a nation, should have done more for healthcare services, we should also have been more charitable towards ICTs.

The government and its various organs have to understand and appreciate that ICTs are vehicles for increased productivity and improved delivery of services. Therefore, instead of treating telecom businesses as sources of easy revenues, they should be facilitating and helping ICT businesses to prosper and grow. The more we allow ICT businesses to flourish, the more ICTs will pay back, in normal times as well as in times of crisis.