ITU assesses Nepal's Telco scenario; suggests for license fees & 4G adoption

ITU, the largest International Telecommunications Regulatory Body, in association with the GSM Association (GSMA) and Nepal Telecommunications Authority (NTA) – the national telecom regulatory body has recently assessed the country’s telecommunication market and the related spectrum issues. The NTA workshop program of the July 31st, 2014 held in Kathmandu concentrated on Nepal’s telco scenarios from the international perspective, the business of telco market in the country, its lagging factors from the rest of the world and the future vision for better telco scenario in Nepal.

Nepal’s present telecom scenario

The workshop attendees prioritized that Nepal is lagging the rest of the world in telecommunications sector development. The infrastructure, no matter how the telcos say good words for their own, is still poor – other hurdles being the challenging terrain and the telco regulatory environment in the country.

According to the experts, Nepal’s telecom regulatory environment is nowhere near world’s best practice. The country now should look outside the immediate region for regulatory best practice.

How many carriers are viable in the Nepalese telecommunications market is a question by the expert addressed the growing number of service providers but with no good infra. The appropriate numbers depend on Nepal’s regulatory settings (which is yet to grow!), market growth, economic growth and the technological development, and its adoption.

Telecom License Fees in Nepal

In situations when the affordability index of Nepal 35th out of 46 (source: A4AI) is not every impressive, revision in the telecommunication licensing fees in the country is likely to put up some figure. The present telecommunications licensing scheme of the government is unparalleled as it doesn’t motivate the license renewal and is biased with company’s profile. This is to say that if the regulations cannot be addressed by the service providers, the development of the information and technology market gets dawdled.

Lately, Nepal Telecom has to pay 20 arab (20 billion) rupees as renewal charges of telco licensing. The equivalent applies to Ncell as well. However, the government is researching how to charge them without deciding – the impact – this scenario will likely to exist every year in lack of proper telco licensing scheme. This problem persist along with the ambiguous government policy in the frequency spectrum management – in fact Nepal has been running quite long without one.

The experts suggest that Nepal should go auction way for the frequency allocation as a way to address the current lag in the system. Let’s see whether Nepal follows ITU’s suggestions.

4G Adoption in Nepal

The experts suggest that the time is right here for LTE deployment in Nepal. With the spectrum 700-900MHz range, Nepal can go 4G adoption, as this range of frequency is best for affordable smart phones and tablets. As of now, only the state-owned Nepal Telecom, has launched WiMAX data services thru out the major cities of the country.

 Nepal has adopted APT Band plan as of May 2013 but still not in a well version policy to adopt 700MHz range. But a good question whether to go with LTE 1800M or APT700 can be a good public/stakeholder’s discussion should NTA think the public/expert’s opinion matter. (Read: LTE or WiMax : what should Nepal go for?)

Sessions covered during the workshop (sourced) include

• Telecommunications competition and regulation in Nepal by Simon Molly, ITU Expert.
• Telecom market issues on licensing, license renewal fees, spectrum road map and infrastructure sharing.
• Alliance for affordable Internet in Nepal by Basheerhamad Shadrach, Alliance for Affordable Internet.
• Spectrum Management Trends & Challenges by Goe Guan, Spectrum Policy & Regulatory Affairs Advisor, GSMA.
• Industry Perspective on LTE Spectrum by Dongfei Zhou, LTE Solution, Huawei Technologies.