Progress on government-sponsored Universal Service Fund (USF) broadband projects appears to be largely on track, while the work is still going on four major projects. PTCL has come out as a major recipient of this scheme as it has managed to jointly win all of the six contracts announced so far. Results of two additional contracts that are expected to be announced in the next few months could see PTCL bow out of the order process on account of the subsidy ceiling being reached.
Currently four work-in-progress contracts, PTCL is expected to gain about 167,000 subscribers. It is estimated that PTCL’s broadband subscribers base would grow at a three-year (FY11-13) Compounded Annual Growth Rate (CAGR) of 47 percent, said Mustufa Bilwani, telecom analyst at JS Research. PTCL has gained about 43,000 subscribers as last reported by USF, and is likely to jump to a total of 159,000 subscribers by the end of 2010. Faisalabad telecom region is expected to add 73,000 subscribers.
“The management is also in the final stages of launching a major campaign to promote broadband use in this area, which in our opinion would help in meeting the quarterly target,” said the analyst.
Recently awarded projects has started in Gujranwala Telecom Region and Central Telecom Region, with combined expected additions after their completion close to 89,000. Funding on two other projects is currently under progress, but it remains to be seen whether PTCL will win a share in any of these contracts as it has already crossed the said funding ceiling (50per cent of total USF subsidy for services such as broadband and fiber optic) under the USF policy. Funding awarded to PTCL for the broadband projects has crossed 4 billion rupees.
