Abdul Moiz Malik
Published January 1, 2023
KARACHI: Governments over the past years have attempted to have social media companies maintain an on-ground presence in Pakistan.
They employed a carrot-and-stick approach — offering incentives of increased revenue and, when that failed, drafting legislation to force them into opening offices.
Over the years, officials claimed multiple times that companies have agreed to establish their presence in Pakistan, but nothing substantial came out of it.
Last month, it was reported that Google has decided to open a liaison or representative office in Pakistan.
The move was unlike the past claims, as the California, US-based search engine giant also obtained a registration certificate from the Securities and Exchange Commission of Pakistan (SECP).
The government believes that the office will be established — most likely in Karachi — within the next few weeks.
Govt sees the move as a game changer, but experts are wary
For IT and Telecom Minister Syed Aminul Haque, this was the result of his ministry’s efforts spanning over three years.
Talking to Dawn, Mr Haque said the government had devised social media rules in 2020 and 2021 after taking local and international stakeholders on board.
The rules — Citizens Protection (Against Online Harm) Rules, 2020, and Removal and Blocking of Unlawful Online Content (Procedure, Oversight and Safeguards) Rules, 2021 — mandated social media companies with over 500,000 followers to open an office in Pakistan within six months.
The rules were severely criticised and the Islamabad High Court ordered the government to revise them.
Now, the mandatory timeline of six months has been removed and the drafts are in the final phase of revision, the minister said.
What to expect?
The government initially wants Google to establish liaison offices in Karachi and Islamabad, Mr Haque told Dawn.
He said that as things progress, further developments will follow, like maintaining a larger team and the relocation of servers.
However, experts believe that expecting anything more than a liaison office would be far-fetched at this moment.
“I expect this to be a minimal-presence liaison office,” said Habibullah Khan, founder and CEO of Penumbra, a Karachi-based experience design studio. “I expect them [Google] to take their time opening the office, hiring a few people and very gradually increasing to a full-fledged office. They will drag it as long as they can.”
For Mr Khan, this was a “strategic move” as Google was “facing the pressure of consequences” and decided to open the office.
Google was contacted but the company did not have an immediate comment on the developments and the nature of the office.
Concerns
As the government presents the move as a success, there are widespread concerns about how the a company’s local office will embolden the government to stifle free speech and increase its ability to remove content.
The IT minister said the government seeks the removal of only three types of content: anti-Pakistan, anti-Islam and pornography. “We convinced them [Google] that local presence will help better negotiate on these issues.”
Digital rights expert Asad Beyg said it was yet to be seen if the social media companies are being covered under rules that were framed to force them to come to Pakistan.
In that case, Mr Beyg said, Pakistan only needs to look towards its neighbour India where the BJP-led government managed to exert control over social media companies like Twitter after threatening them with criminal liability under the law.
“If these companies operate in Pakistan, it has to be seen under what laws they are regulated,” he said.
However, the IT minister dismissed the possibility of a blanket ban and said he “staunchly” opposed any such move that hampers progress.
Citing the ban on YouTube in 2012, the minister said it caused “irreparable” damage to Pakistan’s digital economy.
The ban — for allegedly hosting blasphemous content — also led to legal complications for Google, which owns the video platform.
When the ban was challenged in the Lahore High Court, Google was ordered to send its representative for proceedings. However, the company refused to comply with the orders.
Yasser Latif Hamdani, who represented the petitioner (NGO Bytes for All) in the case, said he was surprised that Google decided to “submit itself to Pakistani laws”.
He told Dawn that under the laws, Google would be asked to censor content, at least to the extent of Pakistan, which will result in a legal dilemma.
“For example, will Google censor websites that describe Ahmadis as Muslim?” he asked, adding that with its presence in Pakistan, Google will be opening itself up to prosecution.
Benefits for businesses, creators
The IT minister said that a localised Google would also benefit Pakistani creators and businesses.
He claimed that creators would “multiply” their revenue and even start earning in dollars which would boost not only the digital economy but also the overall economy of the country.
However, the minister’s enthusiasm failed to find traction among experts and local content creators.
For Mr Khan of Penumbra, the benefits for Pakistan are “absolutely none”. He said that Google earns $150m-300m a year from Pakistan in ad revenue and over $30m from App Store and cloud revenue.
The company gives back around $70m to large publishers, almost all of whom manage holding companies outside Pakistan.
For content creators as well, the hope of any increase in their revenue will be a fallacy.
Talking to Dawn, comedian and YouTuber Junaid Akram said the only foreseeable benefit for local creators was a “single-point” line of communication in case of any dispute or monetisation issues.
The few benefits Mr Khan sees are purely “strategic”.
“Pakistan needs to digitise government and some strategic revenue value chains like taxes. By having a firm but fair relationship, Pakistan has the leverage to get concessions from Google on strategic support for digitisation,” he explained.
“This can extend to supporting innovation in local start-up ecosystem by providing cloud credits and other support.”
Published in Dawn, January 1st, 2023
KARACHI: Governments over the past years have attempted to have social media companies maintain an on-ground presence in Pakistan.
They employed a carrot-and-stick approach — offering incentives of increased revenue and, when that failed, drafting legislation to force them into opening offices.
Over the years, officials claimed multiple times that companies have agreed to establish their presence in Pakistan, but nothing substantial came out of it.
Last month, it was reported that Google has decided to open a liaison or representative office in Pakistan.
The move was unlike the past claims, as the California, US-based search engine giant also obtained a registration certificate from the Securities and Exchange Commission of Pakistan (SECP).
The government believes that the office will be established — most likely in Karachi — within the next few weeks.
Govt sees the move as a game changer, but experts are wary
For IT and Telecom Minister Syed Aminul Haque, this was the result of his ministry’s efforts spanning over three years.
Talking to Dawn, Mr Haque said the government had devised social media rules in 2020 and 2021 after taking local and international stakeholders on board.
The rules — Citizens Protection (Against Online Harm) Rules, 2020, and Removal and Blocking of Unlawful Online Content (Procedure, Oversight and Safeguards) Rules, 2021 — mandated social media companies with over 500,000 followers to open an office in Pakistan within six months.
The rules were severely criticised and the Islamabad High Court ordered the government to revise them.
Now, the mandatory timeline of six months has been removed and the drafts are in the final phase of revision, the minister said.
What to expect?
The government initially wants Google to establish liaison offices in Karachi and Islamabad, Mr Haque told Dawn.
He said that as things progress, further developments will follow, like maintaining a larger team and the relocation of servers.
However, experts believe that expecting anything more than a liaison office would be far-fetched at this moment.
“I expect this to be a minimal-presence liaison office,” said Habibullah Khan, founder and CEO of Penumbra, a Karachi-based experience design studio. “I expect them [Google] to take their time opening the office, hiring a few people and very gradually increasing to a full-fledged office. They will drag it as long as they can.”
For Mr Khan, this was a “strategic move” as Google was “facing the pressure of consequences” and decided to open the office.
Google was contacted but the company did not have an immediate comment on the developments and the nature of the office.
Concerns
As the government presents the move as a success, there are widespread concerns about how the a company’s local office will embolden the government to stifle free speech and increase its ability to remove content.
The IT minister said the government seeks the removal of only three types of content: anti-Pakistan, anti-Islam and pornography. “We convinced them [Google] that local presence will help better negotiate on these issues.”
Digital rights expert Asad Beyg said it was yet to be seen if the social media companies are being covered under rules that were framed to force them to come to Pakistan.
In that case, Mr Beyg said, Pakistan only needs to look towards its neighbour India where the BJP-led government managed to exert control over social media companies like Twitter after threatening them with criminal liability under the law.
“If these companies operate in Pakistan, it has to be seen under what laws they are regulated,” he said.
However, the IT minister dismissed the possibility of a blanket ban and said he “staunchly” opposed any such move that hampers progress.
Citing the ban on YouTube in 2012, the minister said it caused “irreparable” damage to Pakistan’s digital economy.
The ban — for allegedly hosting blasphemous content — also led to legal complications for Google, which owns the video platform.
When the ban was challenged in the Lahore High Court, Google was ordered to send its representative for proceedings. However, the company refused to comply with the orders.
Yasser Latif Hamdani, who represented the petitioner (NGO Bytes for All) in the case, said he was surprised that Google decided to “submit itself to Pakistani laws”.
He told Dawn that under the laws, Google would be asked to censor content, at least to the extent of Pakistan, which will result in a legal dilemma.
“For example, will Google censor websites that describe Ahmadis as Muslim?” he asked, adding that with its presence in Pakistan, Google will be opening itself up to prosecution.
Benefits for businesses, creators
The IT minister said that a localised Google would also benefit Pakistani creators and businesses.
He claimed that creators would “multiply” their revenue and even start earning in dollars which would boost not only the digital economy but also the overall economy of the country.
However, the minister’s enthusiasm failed to find traction among experts and local content creators.
For Mr Khan of Penumbra, the benefits for Pakistan are “absolutely none”. He said that Google earns $150m-300m a year from Pakistan in ad revenue and over $30m from App Store and cloud revenue.
The company gives back around $70m to large publishers, almost all of whom manage holding companies outside Pakistan.
For content creators as well, the hope of any increase in their revenue will be a fallacy.
Talking to Dawn, comedian and YouTuber Junaid Akram said the only foreseeable benefit for local creators was a “single-point” line of communication in case of any dispute or monetisation issues.
The few benefits Mr Khan sees are purely “strategic”.
“Pakistan needs to digitise government and some strategic revenue value chains like taxes. By having a firm but fair relationship, Pakistan has the leverage to get concessions from Google on strategic support for digitisation,” he explained.
“This can extend to supporting innovation in local start-up ecosystem by providing cloud credits and other support.”
Published in Dawn, January 1st, 2023
Rising costs, connectivity outages — a tough year for IT sector
Kalbe Ali Published January 1, 2023
ISLAMABAD: It was a tough year for the IT sector, with telecom operators and users taking the brunt, especially after a change of government in April and the belt-tightening that followed.
Call and internet rates jumped and yet the service quality worsened and speeds slowed in 2022. Network outages intensified thanks to ‘connectivity load-shedding’ in the wake of hours-long power outages and rising fuel costs.
Among the few silver linings was the cloud-first policy introduced in February that sought to shift federal public service entities away from on-premise infrastructure.
However, after hitting that cloud, the ministry asked for the moon when it set a $5 billion export target for IT exports, a figure stakeholders say seems to be anything but achievable.
One bright spot in the otherwise gloom-ridden IT landscape was the export of 120,000 mobile phone sets to various markets in the Middle East and Africa.
Telcos took the brunt in 2022 as rates jumped and service quality worsened
However, the CEO of Inovi Telecom, the company that shipped the consignment last month, said such one-time big-ticket orders wouldn’t work and stressed that regular export orders were essential for the sector’s growth.
To put it in context, out of the 31 mobile phone-making licence holders in Pakistan, Inovi is the only local company to have exported mobile sets.
Its CEO, Zeeshan Mian Noor, told Dawn that the mobile industry had been given a quota of letters of credit (LCs) amounting to $83 million a year to import key components for mobile phone set assembly.
However, “the fact is that raw material worth $185m is required to meet the demand for mobile sets in the Pakistani market”, he said, adding that exporting phones was a distant dream when manufacturers were unable to meet the demand from local buyers.
Telecom trouble
The telecom industry said it was the worst hit in 2022 as operating expenses jumped by around 20 per cent year-on-year, whereas the growth of the industry’s revenue failed to hit even double digits.
The sector has repeatedly insisted that Pakistan has one of the highest levels of taxation, interest rates and the rupee’s devaluation. All this, coupled with increased energy costs, resulted in more than Rs100 billion in unbudgeted costs for the industry in the outgoing year, it said.
With power outages of up to 12 hours a day in some parts of the country and the sharp increase in diesel rates that run the companies’ generators, large parts of the country lack network coverage during power outages.
“Diesel-run generators as well as the capacity of batteries at the towers were designed for two to three hours of outages,” Jazz CEO Aamir Ibrahim told Dawn.
He regretted that the average revenue per user (ARPU), a key tool to measure the financial health of cellular mobile operators, had fallen to less than a dollar from $9 in 2003-04 when only 2G services were available.
For each mobile call, Pakistanis pay 34.5pc taxes, including 15pc withholding tax and 19.5pc general sales tax. The increase in taxes by the incumbent government has led to higher calls and internet rates, reducing consumption and further declining the companies’ revenues.
On the other hand, consumers face a significant increase in “call latency and black holes in the networks”, where the calls or internet either slows or drops.
Telecom companies blame the government for not implementing the right policies and postponing the planned spectrum auction.
Telenor Pakistan CEO Irfan Wahab Khan said the country required more spectrum to improve the quality of service of the telecom sector, and the government should come up with the right kind of terms and conditions, including pricing.
IT exports
At the same time, due to several restrictions imposed by the central bank, the IT exports and the performance of the freelancers suffered, and the $5bn IT exports target for the current fiscal year seems unachievable.
Barkan Saeed, a former chairman of P@SHA, said exports of IT and IT-enabled services could only reach $2.6bn in the 2021-22 fiscal year against the $3.5bn target. “This year, even that figure seems difficult only due to inconsistent policies,” he said.
IT Minister Syed Aminul Haque acknowledged issues faced by the sector. Talking to Dawn, he said the IT sector needed “special attention, as it was not a standalone service or industry but a catalyst that could give a boost to all sectors through digitisation.
However, he added that the performance of his ministry “surpassed the output of other ministries” in 2022.
“The year had been challenging for the telecom sector due to various political and economic constraints, but all the four telcos in the country have continued to serve the public without passing on the complete rising cost of business,” Mr Haque said.
He highlighted that to provide telecom services to small towns and even the outskirts of major cities, significant progress has been made by the Universal Services Fund (USF), providing connectivity to around 4.5 million people.Among the achievement of the IT ministry, significant progress was made on the regulatory side as well, including approval of the country’s cloud-first policy.
Besides, the Personal Data Protection Bill and Digital Pakistan Policy, 2023, are with the cabinet for approval, and the artificial intelligence and freelancer policies are in their final stages, which are likely to boost IT support businesses in the country.
Published in Dawn, january 1st, 2023
Kalbe Ali Published January 1, 2023
ISLAMABAD: It was a tough year for the IT sector, with telecom operators and users taking the brunt, especially after a change of government in April and the belt-tightening that followed.
Call and internet rates jumped and yet the service quality worsened and speeds slowed in 2022. Network outages intensified thanks to ‘connectivity load-shedding’ in the wake of hours-long power outages and rising fuel costs.
Among the few silver linings was the cloud-first policy introduced in February that sought to shift federal public service entities away from on-premise infrastructure.
However, after hitting that cloud, the ministry asked for the moon when it set a $5 billion export target for IT exports, a figure stakeholders say seems to be anything but achievable.
One bright spot in the otherwise gloom-ridden IT landscape was the export of 120,000 mobile phone sets to various markets in the Middle East and Africa.
Telcos took the brunt in 2022 as rates jumped and service quality worsened
However, the CEO of Inovi Telecom, the company that shipped the consignment last month, said such one-time big-ticket orders wouldn’t work and stressed that regular export orders were essential for the sector’s growth.
To put it in context, out of the 31 mobile phone-making licence holders in Pakistan, Inovi is the only local company to have exported mobile sets.
Its CEO, Zeeshan Mian Noor, told Dawn that the mobile industry had been given a quota of letters of credit (LCs) amounting to $83 million a year to import key components for mobile phone set assembly.
However, “the fact is that raw material worth $185m is required to meet the demand for mobile sets in the Pakistani market”, he said, adding that exporting phones was a distant dream when manufacturers were unable to meet the demand from local buyers.
Telecom trouble
The telecom industry said it was the worst hit in 2022 as operating expenses jumped by around 20 per cent year-on-year, whereas the growth of the industry’s revenue failed to hit even double digits.
The sector has repeatedly insisted that Pakistan has one of the highest levels of taxation, interest rates and the rupee’s devaluation. All this, coupled with increased energy costs, resulted in more than Rs100 billion in unbudgeted costs for the industry in the outgoing year, it said.
With power outages of up to 12 hours a day in some parts of the country and the sharp increase in diesel rates that run the companies’ generators, large parts of the country lack network coverage during power outages.
“Diesel-run generators as well as the capacity of batteries at the towers were designed for two to three hours of outages,” Jazz CEO Aamir Ibrahim told Dawn.
He regretted that the average revenue per user (ARPU), a key tool to measure the financial health of cellular mobile operators, had fallen to less than a dollar from $9 in 2003-04 when only 2G services were available.
For each mobile call, Pakistanis pay 34.5pc taxes, including 15pc withholding tax and 19.5pc general sales tax. The increase in taxes by the incumbent government has led to higher calls and internet rates, reducing consumption and further declining the companies’ revenues.
On the other hand, consumers face a significant increase in “call latency and black holes in the networks”, where the calls or internet either slows or drops.
Telecom companies blame the government for not implementing the right policies and postponing the planned spectrum auction.
Telenor Pakistan CEO Irfan Wahab Khan said the country required more spectrum to improve the quality of service of the telecom sector, and the government should come up with the right kind of terms and conditions, including pricing.
IT exports
At the same time, due to several restrictions imposed by the central bank, the IT exports and the performance of the freelancers suffered, and the $5bn IT exports target for the current fiscal year seems unachievable.
Barkan Saeed, a former chairman of P@SHA, said exports of IT and IT-enabled services could only reach $2.6bn in the 2021-22 fiscal year against the $3.5bn target. “This year, even that figure seems difficult only due to inconsistent policies,” he said.
IT Minister Syed Aminul Haque acknowledged issues faced by the sector. Talking to Dawn, he said the IT sector needed “special attention, as it was not a standalone service or industry but a catalyst that could give a boost to all sectors through digitisation.
However, he added that the performance of his ministry “surpassed the output of other ministries” in 2022.
“The year had been challenging for the telecom sector due to various political and economic constraints, but all the four telcos in the country have continued to serve the public without passing on the complete rising cost of business,” Mr Haque said.
He highlighted that to provide telecom services to small towns and even the outskirts of major cities, significant progress has been made by the Universal Services Fund (USF), providing connectivity to around 4.5 million people.Among the achievement of the IT ministry, significant progress was made on the regulatory side as well, including approval of the country’s cloud-first policy.
Besides, the Personal Data Protection Bill and Digital Pakistan Policy, 2023, are with the cabinet for approval, and the artificial intelligence and freelancer policies are in their final stages, which are likely to boost IT support businesses in the country.
Published in Dawn, january 1st, 2023
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