LAHORE: Telecom industry smartphone subscribers base of 3G/4G drastically down by 4.5 percent since the Pakistan Telecom Authority (PTA) enforced implementation of Device Identification, Registration & Blocking System (DIRBS) on all Cellular Mobile Operators (CMOs).
Further, substantial reduction of one percent in telecom industry smartphone penetration of 3G/4G is gradually slowing down the digitisation in Pakistan and can impact Prime Minister Imran Khan’s digital Pakistan ambition.
The industry data shows that during January-November 2018 industry smartphone subscribers 3G/4G registering a growth of 22.5 percent which come down to 18 percent in same period in 2019. Similarly, industry smartphone penetration 3G/4G came down to 4.8 percent in January-November 2019 from 5.8 percent of corresponding period of the last year. The PTA launched the DIRBS at the start of 2019 with an objective to curb the risks associated with the use of illegal mobile handsets in the country and increasing revenue collection. The government through DIRBS introduced verification of subscribers and registration of mobile phones besides detecting and discouraging illegal, non-compliant, non-tax paid handsets and devices by authenticating currently active devices on cellular networks and ensuring continual monitoring as new devices are activated. Before the introduction of DIRBS, handsets with valid and invalid IMEIs were brought into Pakistan through legal and grey channels.
The new PTI government like many steps also introduced DIRBS. But the DIRBS system is apparently going to hit the prime minister vision of digital Pakistan. Under the digital Pakistan vision, government has planned to digitise processes by using the technology. The smartphones and IoT devices play an essential and important role in this connection but if people are not able to afford smartphones or use them properly then how will they use digital services. The telecom industry official believed that blocking of smartphones will eventually lead to a slowdown in data/internet/ digital adoption amongst mobile customers across industry. They said the industry data was already depicting slowing down of the industry smartphone subscribers of 3G/4G and smartphone subscriber penetration of 3G/4G within one year.
“Government should reduce tax slabs on all categories mobile phones brought into the country to encourage penetration of smartphones. As more devices are registered, government will be able to increase its pool of taxes. This will also curb the menace of street crimes in the country as government will have enhanced availability of data regarding mobile phones,” the industry official commented. The CMO is not alone which affected the slow growth in the smartphone subscriber base, but the sellers of the used smartphone also witnessed adverse impact of the DIRBS in their business. Hafeez Centre is one of major mobile phone markets in Pakistan and Hafeez Centre Traders Association Chairman Malik Kaleem mentioned that almost 80 percent of smartphone users are using second hand smartphones while only 20 percent purchased new smartphones. Thus, almost 80 percent businesses in all mobile phone markets of the country were affected after the implementation of DIRBS. “We had meeting with Prime Minister Imran Khan in the past and informed him about the adverse market situation after DIRBS. The premier constituted a team in which PM’s adviser on commerce and trade Razak Dawood was assigned the task to come up with the solution, besides FBR Chairman Shabbar Zaidi to resolve the issue.
“Follow up meetings were held between the FBR and smartphone sellers and the FBR told us that the government was working for a better solution which will be introduced with the next budget,” Kaleem said, adding that the smartphone sellers offered the FBR to allow the import and trade of secondhand smartphones and they will collect the tax for the FBR on these used mobiles. “We told the FBR that we can collect more tax than the government getting from DIRBS, besides ensuring the registration of IMEI numbers with the government,” he added.
Pakistan is the only country that implemented DIRBs while none other digitally developing country has such system in place, Kaleem said, adding that if the government will not allow the trade and import of used smartphone then it will eventually slow down digitisation process of the economy and hence negatively impact prime minister’s digital Pakistan vision.
