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Pakistani ARPUs a problem for Etisalat

Ufone generating ARPUs of just $3 per month; latest stats show mobile penetration in Pakistan just 56%.

Etisalat’s Pakistani subsidiary is delivering the lowest average revenue per user of all its overseas operations, the United Arab Emirates-based operator admitted last week.

Pakistan Telecom Company’s (PTCL’s) ARPUs have fallen to just US$3, Etisalat chairman Mohammad Omran told Gulf News.

By contrast, the paper pointed out, Etisalat generates ARPUs of $49 in its home market.

In a press announcement, meanwhile, the UAE incumbent’s chairman explained that the telco is increasing its focus on its international operations. As it stands, Etisalat’s international subsidiaries contribute 10% of revenues, but Omran said he aims to increase this to 20% by 2013.

The telco currently has operations in 18 countries and is eyeing six more across the Middle East, Africa and Asia.

Etisalat beat stiff competition from China Mobile, SingTel and others to acquire a 26% stake in PTCL for $2.6 billion in 2005.

But although the market has huge potential for growth, many claim the investment has failed to live up to Etisalat’s expectations.

According to PTCL’s latest quarterly report, covering the three months to the end of 2009, the company’s mobile operations, branded as Ufone, recorded a 24% increase in revenues, while turnover at the fixed-line side of the business was down.

Ufone is the smallest of Pakistan’s four main mobile operators by subscribers, according to the latest statistics from the Pakistan Telecommunication Authority.

Market leader Mobilink – owned by Egypt’s Orascom Telecom – had 30.8 million customers at the end of 2009, followed by Norway’s Telenor, which claimed 22.5 million. In the hard-fought race for third, Warid Telecom is slightly ahead with 18.85 million, while Ufone’s base numbers 18.51 million.

In January Indian mobile operator Bharti Airtel agreed to invest $300 million in Warid Telecom in return for a 70% stake.

Pakistan’s total 97.58 million mobile customers at the end of last year give it a penetration rate of just 56%.

However, operators will have their work cut out to connect that sizeable unconnected base profitably.

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