Telecom Dreams Sold Dirt Cheap

Dear Shakir: Very fascinating intrigue, a good example of intrigues surrounding the working of our governments. Thanks forbringing it to light at chowk.

It will be intersting to find the connection, Akhter Computers might have with PTCL directors, government officals or generals running the country right now, because 4.6 million seems a short change for giving away the store. Seems like Russians giving away state enterprises to cronies, dirt cheap.

Shakir sahib,

This is an interesting article, but there are some gaps in the case you make against this joint venture that one would need to know before arriving at any conclusion. As follows:

a. How much equity capital is PTCL providing? How much will be borrowed? All you provide is Akhtar Computers (ACs)contribution, $4.5 million, but without this additional information one does not have a complete picture of the financial plan. And as such, it is impossible to agree or disagree with you that this is an improper deal where AC is in effect gaining ownership of nearly half of a $30 million investment by putting in only $4.5 million.

b. Is the source of your information (e.g. on the figures mentioned above, and on the bidding process and that ACL was the sole bidder)? Is this based on published material (as you seem to indicate) or word of mouth?

c. You seem to present one side of the story only: the only people quoted are PTCL managers. How about the response of the privatization commission to this, or response of Akhtar Computers? Did you try to approach them at all? PTCL has for years managed to survive as a state owned monopoly despite efforts by current and past governments. While I am all for openness in governments, your article seems quite one-sided to me.

If you are right, then you are doing a national service by raising the red flag BEFORE the horse is stolen, despite the gaps and shortcomings I see in your article. If you are wrong in making this look like an improper deal, then you are simply joining hands with the bureacrats at PTCL as they protect their personal interests at the expense of the current and future generations of Pakistanis. I hope you will take the time to prove you are right.

Shakir Sahab#

These kind of incidences are tip of the iceburg.

Ah! Shareef Musharraf and Ah the loathed criminals of past.

I have heard the state became pious on 12 Oct 1999. And has a certificate of cleaning itself with ``Aab-e-Zam Zam``.

Looks like ``Aab-e-Zam Zam`` was switched to water from Liyari and instead LIKE MINDED POLITICIANS and scions of army and beaureucracy drank Aab-e-ZamZam. Except the whitewash of Mansur-ul-Haq. But Mansur is always hanged for the sins of whole mafia. The Jesus Mansur has taken away the sins and now everybody is free to sin.

But credit should be given to our Army for at least taking care of old corruption.

Lets hope the incoming Government of another adventurer will topple this Government on charges of corruption.

And his next Government topple again on charges of corruption. Ad infinitum.

Khane Wale Khate Rahen Gey. Army or beareucracy Ke Jawano Fikr Nahin.

Qurbani Ke Bakron Ki Khep Tayyar Hai. Tum Date Raho. Baqi Kuch logon Ko Haddayan Dalte Raho.

Baqi Bevqoof Jo Hain Unhein Haddiyon Ki Bhi Zaroorat Nahin. Pakistan Aur Islam Ka Tarka Hi Kafi Hai.

tahmed321 your reply #2 is dead on.

Mr shakir Hussain please in the future do more homework and give us more fact based data rather than insights. I hope for your sake you are right....but knowing ACL in UK they are a very highly esteemed company with hard working Pakistanis who in the last 20 years have developed to be a be a leading computer assembler in UK. I never knew they claimed to be an ISP and their main customers are the british government so their validity in providing computer equipment and being rejected to the likes of Pakistani government organizations seems a little fishy.

Please analyse other sides of the story.

Related to tahmed321`s questions.

gfm #4

You know what.

Who give the damn f-k to other side of story.

Do you think anybody will buy anything after reporting by HERALD.

Or do you think the other side will tell true story.

How old are you brother and for how long you are staying on Mars.

Also you know what.

The deal is fishy.

krashid #5 bhai, itna ghusa??

to answer tahmed321`s questions:

a) PTCL was matching ACL`s contribution and was essentially cutting them in to provide services that they could have themselves provided. where`s the logic in that?

b) the herald had access to PTCL minutes and ACL`s proposals so it was printed matter from ACL and PTCL which were used in analyzing the financial aspects of the whole deal.

c) ACL was contacted via e-mail but there was no response. In addition, nobody knew them in the pakistani market. in islamabad they have a hardware store and that`s it.

now to answer gfm

all the financial aspects of this deal are based on ACL`s own proposals and not insight. No one doubts ACL`s stature as a hardware assembler but that doesn`t give them the right to lie on a government tender or otherwise. they don`t have any expertise in the area of managing networks or infrastructure projects, and the terms being offered to them were ridiculous as well. btw the 4.5 million investment was supposed to be phased over 3 years - so not a lot of cash being put up by them in the first place. if there are any other sides to the story please let me know.

To krashid reply number 5:

men are from mars and women are from venus. And pal you ain`t from any planet in this galaxy system.

Firstly I am gonna blow you away on your inane and dumb comments -

Secondly if you have lived in Pakistan you will understand that journalism is not of the highest quality and while herald is a reputed magazine you do have the occassion of shoddy journalism. and this shoddy journalism.

thirdly if you understand anything about public opinion you will understand that the pen is mightier than the sword and that journalists hold a vast amount of responsibility in printing objective facts - this chap has printed stattments from PTCL execs -bureaucrats who have probably fed this guy the story and who have been eating at taxpayers money in this government utility for many years.

Fourthly the company in mention ACL is a reputed company in the UK and as computers are becoming commodities (if you do anything about technology) they are making investments into telecom. Nothing wrong with that. Nothing wrong with a joint venture either but in this article the numbers don`t add as pointed out by reply number 3.

Fifthly like any like minded Pakistani I would like to sniff out and know what is rotten in the state of Denmark but I would like to have conclusive proof before slinging the dirt and accusations on ``shady`` deals.

Sixthly if you had brains and a little insight you would realise that this article is probably more about PTCL bureaucrats afraid of losing their jobs. You see competition is better than monopoly -thought you might know that.

Seventhly, my comment in my reply was that the journalist needs more facts to back his claims and give us more clarity regarding the numbers as tahmed has pointed out. Also please explain to me how a joint venture from PTCL actually creates competition? If PTCL has invested money in a JVC than it will expect a return if it makes a profit with ACL?

Smell the roses before you shred them buddy and easy on the personal attacks and language.

Flaming is a pathetic trait that has developed on Chowk becuase of ignorant folk like you.

Interesting article .I think I remember this article .Anyways , seems a tad incomplete , perhaps some chowkwalla can add to this?

Dear Shakir: Thanks for responding to my questions. Your responses are quite inadequate, unfortunately, as follows:

On your point (a), you say ``PTCL was matching ACL`s contribution``. If one accepts what you say, then this means PTCL is providing $4.5 million. But then PTCL and ACL together put in $9 m, and this leaves a gap of $21 million (total investment being $30 million, per your article). Who is this annonymous sugar-daddy who is putting in two-thirds of the investment that you ignore in your article and ignore in responding to my explicit question? I can only conclude that you are not interested in facts, and are just putting in a couple of numbers to create the impression of investigative reporting in what is basically a jumble of misconceptions and rhetoric.

On (b), if printed matter was indeed used in analyzing the financial aspects of the deal, then whoever used it did, for reasons described above, did a shoddy job of presenting the figures.

On (c), if ``ACL was contacted via e-mail but there was no response``, then this should have been mentioned in the article. And from your lack of response on my question regarding contacting the privatization commission I assume they were not contacted at all. And yet, it is the privatization commission that is most directly answerable to the public on this question. I find it astounding that you leave out basic facts, you leave out the point of view of other concerned parties, and respond (later on in your post) to gfm by saying that if there are other aspects he should let you know.

I would welcome investigative reporting like this. As gfm correctly notes, responsible journalism is an important foundation for a civilized society. But your article does nothing more than provide public forum for presenting the point of view of a bunch of PTCL bureaucrats jealously guarding any intrusion into their empire.

In future, if you wish to develop a career as an investigative journalist, I would suggest doing your homework and presenting facts from which the reader can draw his conclusions.

gfm # *

Thanks for compliment.

I am ready to be blown up baby.

A country whose Government institutions can misguide and give wrong figures to institutions like IMF and World Bank, cannot be trusted.

Give me ten thousands reasons instead of paltry less than ten, it does not change an iota.

The only people we trust a little bit who are in journalism, and politics.

And don`t worry baby Jahil- (pl. Johla) will take the knickers down of ParRhe Likhe Jahil.

hi guys....seems your privatization program has the same hurdles we chaps facein india....good to know we r not alone in this galaxy.

devkant.

krashid #11 ``Government institutions ... cannot be trusted...The only people we trust a little bit who are in journalism, and politics.``

Is PTCL, whose views the article projects while ignoring other points of view and without providing any factual substantiation, not a government institution? I am glad to report that normally you write more intelligently than you have done so far on this board.

As for journalists and politicians (!) whom you trust, that is fine. No one is questioning Shakir Sahib`s personal integrity or lack thereof: what is relevant to this discussion is that his article makes such a trashy case for protecting PTCL (namely, it basically questions why PTCL needs competition of any kind when it is capable of providing various telecomm services), in one-sided (quotes PTCL directors only), and throws in a couple of meaningless numbers.

Let`s face it, you got fooled into going along with the hogwash in this article in your first pos,t and now you are taking your frustration out on poor gfm.

To mr Shakir,

Once again I have to agree with tahmed`s points in his response to your response. You wrote:

``PTCL was matching ACL`s contribution and was essentially cutting them in to provide services that they could have themselves provided. where`s the logic in that?``

I can tell you the logic - Outsourcing or divesting. If you look at all the big telephone companies in the world AT&T, C&W British Telecom , NTT they are all divesting and rolling of businesses they neccessarily do not want to be in - in the future. Not to say that I know PTCL`s strategy for the future but it would make perfect sense for them to slowly roll out of certain businesses through setting up of new companies and JVs.

Secondly you do have a minor point that maybe the government ie PTCL did not correctly pick a suitable candidate for a joint venture. Similarly, ACL is not neccessarily at fault for while telphony may not be a core comptency in their product offering it is any area where many firms like them are moving into - network infrastructure and web hosting services are areas that firms such as Compaq and Dell and many other smaller firms have also put their fingers in.

Thirdly it would be PTCL`s fault for not doing a more due diligence study on ACL - but then again your article fails to give any conclusive proof that ACL`s contract was a ``under the table`` deal. Suggestions and sound bytes are not enough

I think the key point Mr. Shakir for you is just do more research and better analysis in the future. Your article is well written and we do need more people like you in Pakistan uncovering the truth and doing investigative journalism. I have immense respect for people like you who are at least doing their best and actually making a change in their country.

But it is absolutely essential that all facts are taken into account before insinuations are made. Good lives of people can be ruined with the touch of a pen. The article is merely a skeleton that needs more data, logic and conclusive proof to back up its accusations.

from http://www.ptcl.com.pk/ptcl/news/



PRESS RELEASE ON ESTABLISHMENT OF TELEHOUSING JOINT VENTURE PARTNERSHIP BETWEEN PTCL AND AKHTAR COMPUTER UK

In pursuance of the Government policy on IT, Pakistan Telecommunications Company Limited and Mr. Humayun Mughal, Chief Executive Akhter Computers UK have come to an understanding to establish a Joint Venture Company for provision of Tele-housing facilities in the country. The project envisages an investment of about US$ 30 million in the country. This initiative will open new vistas of opportunities for cost effective provisioning of data and Internet services. PTCL and ACL would be first in this region to introduce the concept of Tele-houses and PTCL will be one of the pioneering telcos that has taken major initiative on the national scale. This project will facilitate optimal utilization of the existing facilities and infrastructure and to bring about a major IT and Internet boom by introducing international level expertise through this JV partnership. This will provide opportunity for further infusion of direct foreign investment through companies who will locate their equipment in the Tele-house.

This became possible as a result of open bidding process and after Board approval, today we are signing a joint letter of understanding on principles and intent for establishment of Telehousing project under JV arrangements. Tele-house provides a convenient and secure environment to locate the telecom equipment of various players on terms to be settled between the management of Tele-house and the clients. It is a central facility for operators to interconnect with each other and is a key component of today`s market. Tele-housing facilities are provided in a premise that has full security, (like guards, video cameras, proximity alarms and palm print readers) fully conditioned and managed space and stable round the clock power supplies. As a result of this project all major cities of Pakistan will be connected through 1Gigabit backbone which in future would be enhanced to 10Gb according to emerging needs and demands. Individual Firms in the Tele-house may have their independent customer base. The Tele-housing facilities may include provisioning of purpose built facilities used for co-location of ISPs systems, web hosting, content provision, financial services, data ware housing, e-business and other services.

Both the parties are confident that with the establishment of Tele-houses, which will be operative by early in 2nd quarter of next year, we will have a major break-through in the area of Information Technology and HR Development. This will be a strategic move in acquiring a significant position on the IT map of the world giving Pakistan an edge in the region leading to strategic regional hub. This move will also help PTCL to meet the challenges of deregulation by using latest technology to built national high-speed data network.

Dear Shakir: I was also little suspicious about the information produced in your article although Ia m quite familiar with the working of Pakistani governments, BB, NS or Mushy make no difference.

So I have been doing google search about Akhter Computers Limited for the last few days. I am now more than before convinced that you are right. Never mind people who are convinced of transparency of Mushy`s government and would not consider of any foul play involved here.

Akhter Computers Limited is a 20 year old company, founded by a graduate from University of Liverpool. While in the past 20 years, some computer manufacturers have become big international organizatioinn and some disappeared, ACL has survivied as a peanut in the era of giants. There annual sale is about 100 million dollars and employs about 300 people. Their major costomers are schools and universities. Most of their income though generated by becoming a reseller of Toshiba computers. I do not know the profit margin but assuming 15 percent profit, they make about 15 million dollars per year.

Now this is not exactly a major player to be in joint venture with PTCL. They should not have even been invited for bidding or taken seriously for two reasons. 1) They are too small to own such a large share in PTCL future business, 2) They bring no expertise in the areas you mentioned in your article. They are computer assemblers and resellers and do not have expertise in telecom indutry.

It will be interesting to know who else made bids and if a giant in telecom industry made bid. If they did, why was it rejected in favor of a very very small potato who brings no expertise in any of the telecom areas. A company with 15 million or less annual profit in reselling computers is not fit to play the major role in telecom industry in Pakistan.

Without a doubt in my mind, I smell back door dealing here. For 4.8 million dollars or even 30 million dollars (which ACL will not have, due to being a very small company with small profit), PTCL is giving away their monoply in many areas of telecommunications.

Better find the connection that got Humayun Mughal such a lucrative deal. Mushy and Mushy`s government dealings are as fraudulent as his predecessors. Favoritism, kickbacks and nepotism continue.....