Is this the first MVNO in Pakistan?
- July 15, 2023
- Posted by: Allan Rasmussen
- Category: MVNA-MVNE-MVNO
Will Onic be the first mobile virtual network operator (MVNO) in Pakistan?
Over that last couple of days, the name “Onic” has been showing up on various social media sites from Instagram to twitter and TikTok, claiming to become “Pakistan’s first digital telco”.
The social postings has ignited speculations that this may be Pakistan’s first mobile virtual network operator (MVNO).
Others are speculating that it is from the Singaporean MVNO “Circles Life” and that it may just be a white-label app/sub-brand rather than a MVNO – and thereby trying to circumvent the need for a MVNO license/regulation, similar to the setup Circle life has made in Indonesia with a local telco.
USD 5 million for a MVNO license in Pakistan
At the time of writing this, there has however not been any official information from Pakistan Telecommunication Authority (PTA) of any MVNO license awarded, and although Pakistan does have a MVNO licensing regulation in place, the fee for such, is so ridiculous (U$5 million), that is has kept all sane and interested MVNO candidates away.
PTA and CRTC in Canada for that matter have completed missed the whole MVNO definition – or it cannot be ruled out that they do know, but the existing operators in those markets have gained so much power over these regulators, that the regulators somehow changed the MVNO definition in favor of these traditional operators.
The whole concept of Mobile Virtual Network Operator (MVNO) – or MVNA/MVNE for that matter is – as it says in its naming:
Virtual = almost, or nearly as described, but not completely. So it is NOT a mobile network operator but was introduced to:
Maximize existing investment and scarce spectrum and avoid dual investment in it.
By removing the first expensive steps of the investment ladder, compared to a mobile network operator = spectrum and the rollout of a mobile network – MVNOs use the existing infrastructure and spectrum of a mobile network operator as partner, by utilizing wasted capacity on the scarce spectrum and then concentrate on the service offer instead. Bringing innovation and competition to the market.
PTA’s license fee and that they must pay the same fees as network operators is therefore the opposite of the intentions, while CRTC in Canada is completely beyond reach = wanting MVNOs to setup network.
There are five mobile operators in Pakistan i.e. Telenor Pakistan, Pakistan Mobile Communication Limited (PMCL/Jazz), PTML (Ufone), and China Mobile Pakistan (CMPak/Zong) – as well as the Special Communication Organization (SCO) in Azad Jammu and Kashmir (AJ&K) and Gilgit Baltistan (GB).
None of these mobile operators have announced any wholesale agreements or partnerships with MVNOs. However, on Onic’s LinkedIn company website, it has listed its HQ address as: 92 , Nazim-ud-din Rd, Block J F 7/1 Blue Area, Islamabad, 48400, Pakistan – which is VERY close to Ufone (Ufone Tower). Ufone became a part of the Emirates Telecommunication Corporation Group (Etisalat) in 2006.
Another giveaway that Onic is more likely just to be a sub-brand of Ufone is the Onic App on Google Play where the developer is listed as Pak Telecom Mobile Limited a.k.a Ufone.
Onic Pakistan
Onic’s LinkedIn site lists John McEvoy as a Board Member, He is the CEO of a joint venture between Etisalat Group and Circles, Singapore – So there is the link to Circles Life.
Bilal Sheikh is listed as General Manager for Onic Pakistan and Abdurrehman Butt is listed as Chief Financial Officer.
There is not much information on Onic Pakistan’s own social media sites and website – other than a few one-liner propositions such as:
“Experience seamless transfers and simple onboarding with a free e-SIM” or “The network is waiting. Join the exclusive community” – followed by a sign-up form if you are interested. The privacy policy on their website is also not giving away any company information.
There are four “benefit” points on its website with the text:
- Off-net liberty
- Home delivery
- Hassle-free onboarding
- Sign-on to founder benefits.
The latter indicates some sort of rewards-program or perhaps a co-operative since its says “founder benefits” which could mean, all members who sign up become founders of Onic?
It is also interesting to see that the information and replies to questions on social media is in English, even when the questions aren’t.
On social media, Onic writes it provide both eSIM and physical SIMs and “We will be providing our customers with epic data, unlimited minutes, and endless opportunities”
When people ask about more info such as company info or launch date there is a standard reply: “We’re pumped up about giving you the best digital telco experience ever. If you’re afraid of missing out, then relax and discover how we will “untelco the telco” by signing-on to our waitlist…”
MVNO, Sub-brand or OTT?
Still the elephant in the room is – will it be a MVNO with license and everything or will they try to prevent being defined as such, in order to avoid the fees and regulations by launching it, as an app-based sub-brand?
The two JV partners Etisalat Group and Circles, Singapore does have the money to pay for a MVNO license, and equally the large Opex and Capex associated with setting up operation in a new MVNO market that does not have existing infrastructure in place – or where the traditional operators have built barriers to entry via monopoly like deals in retail, distribution, payment channels, etc.
Although the USD 5 million for a MVNO license in Pakistan might just be considered a parking ticket for Etisalat, and will seem to its shareholders, as a positive sign that they are investing to expand its business – it can however be another story for Circles, who despite having received large rounds of investment have not been able to expand their own MVNO operation as promised. I.e. they were unsuccessful in their quest to get licenses in the middle east and their operations in APAC have seen staff cuts and lost momentum.
Circles recently bought the Pareteum MVNE platform (the old Elephant Talk platform) who was under chapter 11 and is now looking to monetize that “investment”. But it remains difficult as potential MVNO clients are wary of giving a potential MVNO competitor (Circles Life) access to its business data.
According to Campaign, Circles.Life experienced another round of layoffs in June/July this year, following a previous round in May.
Campaign writes it has come to understand that the impact of these layoffs have reportedly been felt across multiple departments, including marketing, engineering, product, people and culture, and the entire Circles X team, its cloud platform. Reportedly one of the company’s co-founders was also asked to leave after pressure from the board, and his position changed to a non-executive director.
According to sources, the layoffs were not limited to just the Singapore office, but extended across its operations, including the entire Australia marketing team.
The downsizing decision was attributed to various factors, such as cost efficiency, underperformance of the Circles X business, a decline in subscribers due to market forces and competition, as well as poor service.
“Circles X is failing as a product. A lot of their partnership deals were supposed to close but didn’t, and Circles.Life as a telco is losing market share alarmingly,” said one ex-employee.
In response to a Vulcan Post’s inquiries about the layoff on July 7, a spokesperson from Circles.Life refuted the claims. “There have been no layoffs at Circles,” she said, and dismissed the remarks as “untrue”.
However, the ex-employees showed their “agreement of separation and release” from the company to Vulcan Post, contradicting the spokesperson’s statement.
In a statement from Etisalat Group and Circles when they announced the joint venture it says:
“Our main objective is to empower Mobile Network Operators (MNOs) by introducing and managing fully integrated ‘Digital Attacker’ brands…” – Which shows that the JV is proposing to travel the world and tell other operators how to run a sub-brand MVNO.
Question thus remain will it be licensed and regulated as a MVNO – or will it be a app-based sub-brand MVNO operated by the JV – which in that case, is a MVNO = another entity using the network of a licensed network operator?
Or will they try to circumvent the regulation and bring it to market as a over-the-top (OTT) service?
And of course, which operator would be willing to let this joint venture (a MVNO and another operator) come in and run their business?
¯\_(ツ)_/¯
Clarification from Pakistan Telecommunication Authority (PTA)
UPDATE: Pakistan’s Telecommunication Authority (PTA), has released a clarification on August 11, 2023, with reference to “Onic” and what the PTA calls “misconceptions amongst the public and social media users“.
So, as suspected – it is not a new MVNO – but purely a marketing gimmick by the team behind Onic and Pak Telecom Mobile Limited (PTML) and the PTA writes it has been in active communication with PTML regarding their plans to launch “Onic”.
However, the sentence “misconceptions amongst the public and social media users“, in the clarification release by the PTA, is a weird choice of wording, considering the marketing stunt used by Onic/PTML with words like “Pakistan’s first digital telco”, “The network is waiting” and “we are a new, digital-first platform that provides seamless connectivity”.
This has clearly mislead the public to believe a new operator was entering the market, obviously from the amount of questions from the public and the very fact that PTA itself decided it had to publish a clarification. So don’t blame the public!
