Grey traffic: cause of telecom blues

Have you ever received a call from a relative or friend who lives abroad but the caller ID shows a local number? If yes, youve indirectly been a part of the grey traffic scam plaguing Pakistans telecom industry. But don worry, you are not the culprit.While the PTA has cited a monthly loss of $25 million due to illegal telecom traffic, industry players fear that the loss may be greater. Against legal telecom traffic of 400-450 million minutes per month, grey traffic is estimated to be roughly 300-450 million minutes every month, one industry expert told BR Research.
This is a worrisome fact indeed.
The current policy regime charges 10.5 cents a minute for international calls coming to Pakistan; of which, 5 cents are passed on as Access Promotion Contribution (APC) to Universal Services Fund (USF).
The high APC rate charged has prompted grey traffickers to exploit the situation, luring customers by offering their services for as low as 5 cents a minute.
It is not very hard to see why grey traffic is thriving and has eaten up revenues for several registered companies such as Wateen and PTCL.
However, given the need to expand telecom outreach and increase access in under-served areas, the APC cannot be dispensed altogether, at least not until the Pakistan telecom market has grown to a point of sustainability.
To make matters worse, the scenario has become grave to the point that even some registered companies are succumbing to using unfair means to compete with the grey area, channeling international calls as local ones to evade APC. This is observed when an international call appears as a local call on the caller ID. The violation of one country one rate policy is also a consequence of the same.
The national exchequer stands to lose severely through this practice when even the legal operators twist around the rules. So the only option left is to curtail the epidemic of illegal traffic afflicting the telecom sector.
Making matters worse, the lack of technical capacity and expertise faced by the industry hinders the ability to catch illegal telecom traffic originating overseas and carried out over the internet protocol (IP).
The new technology NARUS Discovery Suite, adopted by the PTA has not been very promising, particularly since even that cannot detect the undercover activities of some of the registered companies. The technology provides real-time traffic intelligence of large IP networks to detect rogue trafficking.
Even though the PTA has been catching around 670 cases everyday, several new ones develop thereafter. To add salt to injury, sources in the telecom industry claim that the FIA has been very uncooperative lately, taking weeks to penalise guilty operators.
That leaves one core option that telecom pros have suggested as a viable alternative - the International Clearing House (ICH).
As per the ICH, all international calls landing into Pakistan will converge at a single technical exchange, as against being handled by 14 different licensees. The idea is that if all calls are routed through a solitary exchange point, it will be far easier to detect grey traffic.
Failure to do this only leaves the last option of slashing out the APC and deregulating the telecom sector completely, but this will be a huge loss to the government. Yet, this might become an inevitable option if steps are not taken to curb illegal traffic which is fast eating up the share of the telecom industry.