LDI Operators Agree to Implement ICH

pakistan-telecom14 Telecom operators with Long distance and International dialing license have agreed to establish a centralized landing gateway for internet calls in order to curb grey traffic, reported Express Tribune citing a report by BMA Capital Research.

The gateway, International Clearing House (ICH), will make possible for all LDI operators to get international calls landed to a single technical gateway against the current practice of being handled by 14 Long Distance International (LDI) operators independently and that too at different rates, said the BMA Capital research note issued on Tuesday.

The largest LDI operator PTCL – with a 50% market share – will lead the technical consortium where the entire international traffic will land.

“The other operators will be allotted fixed quota in total industry revenues based on their respective market shares,” says the note.

The idea is to curb grey traffic and at the same time enhance margins on incoming international traffic.

Once the International Clearing House comes into play, the rates for overseas callers may witness a massive jump as any foreign operator terminating calls into Pakistan would have to pay Rs. 7.64 per minute (USc8.4/min).

“PTA issued 14 LDI licenses of which many have been struggling and some have defaulted on their license and debt obligations in the past. This is a lifeline for small, struggling operators but bigger players may not like an agreement that lets others benefit at their cost. Hence, tussles on quota may create problems in the future,” said KASB Securities in a research note. The entire arrangement is expected to be finalized by May 16.

Idea of International Clearing House was first tabled back in 2008, when PTA had proposed a centralized gateway for international traffic for all LDI operators in order to make illegal landing of voice calls impossible.

However, the implementation kept getting delayed for various reasons – mainly the revenue model and modalities of ICH. Even CCP had issued a verdict saying that ICH is anti-competitive and that LDI operators could withdraw themselves from ICH.


  • Sacha Kaka

    We already have expensive international calling rates :(

  • sofh

    sacha: that revenue will goto govt. which will help our country a lot. Pakistan have two major ways to earn, agriculture and Telecom And from many months Telecom is in loss . so this high rate will be for the benefit of whole Pakistan.
    Just pray that money is used without any corruption.

  • gamezfever

    please remove one have in line 2

  • M.Fahad

    Price would jump , like we aren’t paying high price for LDI . Middle east has got highest rate of calling . And majority of pakistani citizens are in Middle east

  • nationalist

    Exceelent. Now GoP will earn revenue instaed of Multinational company.
    Shame on Mushraf, shoukat aziz who overwrite the rule of international traffic landing in pakistan from PTCL carrier to proivate carrier and due that decision approx GOP was losing 800Million US$ per annaum, half of price being offered under controversal Kerry Luger Bill.
    If calculte from 2005 it will come outt 5 Bln US$.

    • NABAMB

      Now you have anti Musharraf propaganda here. Shame on you.

  • Telecommer

    @ nationalist
    There is no shame on Musharaf. He did excellent work by introducing LDIs. A huge number of pakistani’s get employed. The reason that ICH has to be implemented is corruption. The loss is not due to LDI but becuase on higher rates, guyz with power terminated illegal traffic (grey traffic) which caused loss to country. In LDI configuration, all LDIs have to pay a percentage of amount to government known as APC. I am working in LDI companies and know what exactly happens and who is wrong.

  • zeeshan

    @PTCL.. this LDI revenue is junk compared to there income they make from there broadband and landline operations.. financials are available u can verify.

  • Telecommer

    Dear Zeeshan,

    This LDI revenue is not junk. Voice traffic generates many times more revenue than broadband. And in international termination, the deals are in USD, not PKR. So, the rotation of money and everything involved is …. There is much more to it…

  • Ahmed

    ICH management should take AJK LDIs on board for success of the idea of one international gateway.

  • Telecommer

    Actually, AJK LDI will not go with these. Due to sensitivity of that region, it always have a separate management and Lawful interception.

    By the way, I heard that ICH is again postponed. Don’t now, whats going on now

  • zeeshan

    ICH not postponed
    all LDIS have signed , in todays meeting its $.08 probabaly effective from June 15
    We pay higher rates to gulf contries , and europe so let them pay higher its billins of $ revenue for Pak even if the grey traffic exists like anywhere in world renvenue increase will be in billions US$
    pak need this money

  • tareeen

    yes todays meeting $.08 final Paksitan needs revenue and there few sectors where isntant revenue can be generated .
    One good step in right direction ICH delayed decision and implementation cost us billions now no more delay

    • Qazi Hassan

      AOA Tareen.

      How are you? do you know when new rate will be
      implement?

      Looking forward to hearing from you.

      Best Regards,
      Qazi Hassan.

  • Qazi Hassan

    Dear all,

    ASA, good day, it’s been long time i’m living in South Africa and we’re paying here heavy charges even on local calls ( Within Country) approx 2.5 Rands/Min (25 PKR), and to make call to Pakistan @ Rand 1.00/Min (10 PKR) + Taxes = PKR 13.00)

    In other words Calling cards/Mobile Compines robbing us both on Local and international calls.
    We’re happy to Pay them above mention amount because we’re making money here but those companies paying nothing to our Country which is unfair even in future if they’ll revise their rates for Pakistan we will happy to pay them because we will know most of our money will directly effective on our economy.
    Now come to the Point of ICH, best of my knowlage ICH is a very effective move in telecom industry in pakistan, because it will increse Foreign remittance volume in Pakistan and INSHA ALLAH our Stock Exchange will be stable in near future.
    and it will generate more money for LDI Operators to purchase new License i.e 3G etc.

    Now no more APC rate will be offer to Foreign Operators and ASRs will be the only choice for them, they can’t control pakistan Traffic for Example: if i want to make calls to pakistan i will do it, i don’t need to get permission from anyone like Calling cards/Mobile Compines etc.
    and y’all see Pakistan International traffic will be boost up after ICH implementation.

    Does anyone know what & when new rate will be implement in Pakistan?

    Looking for to hearing from y’all.

    ALLAH HAFIZ

    Best Regards,
    Qazi Hassan
    Durban, South Africa.

  • Telecommer

    Hi Mr. Qazi,

    Well, the actual idea is correct which you said. but the point is that will after ICH, economy will rise or guyz hitting in authority/government are doing this to fill their pockets. The reason that ICH is delaying is that government guyz are fighting among themselves to get some share from it. Secondly, the threat is that after the rates go up, grey traffic will again shoot up and promoted. The guyz with powerful backs are going to do it. This is why many of them are willing to go for ICH because these days, rates of legal internation traffic has gone so low that it is cheaper than setup of grey traffic.

    Regards,

    Telecommer

    • Qazi Hassan

      Valued Friend,

      Thank you for your kindest reply, I’m totally agreed with your points, but even if some bad people maintain their illegal gateways how much traffic will they gonna eat? at the end money will come to our country in our Pakistani People hands. (i’m not in favor whom runing illegal gateways).

      My point is sacrifice few million to save many millions.

      waiting for your kidnest reply.

      Best regards.

  • Telecommer

    I think last time, the ratio of grey traffic and white was 30:60. Means 30% was grey traffic. I just heard that President has stopped Ministry of IT (MoIT) to send instructions to PTA for implementing ICH. Seems its going to delay for more than a month (at-least)

  • Qazi Hassan

    It could be possible, but i couldn’t find any news about President instructions to MoIT,

    All i can say Pakistan Govt. should take this matter seriously and do best for our PAKISTAN INSHA ALLAH.

    Regards.
    Hassan

  • tareeen

    Dear Telecommer
    I dont know what source you have , but pl dont spread just rumours , president has no direct right to interefere , only prime minister has right , so there is no instruction form Presidnts office
    the Implementation is around june 15 2012
    Grey trafic will be there , but revenue to country will be in Billions usd so one has to look at larger interest of country

    • Telecommer

      Dear Tahreen,

      I agree with you but i hope that this revenue add more to the economy of country not personal pockets. I wish it happens soon as it is not the only time, it is delaying. I hope it will not delay further.
      Initially, ICH has to be announced on 16thMay and would be implemented in a month. But it is not announced on 16th. After announcements there will be notices issues so each LDI can update their Customers that they will not be entertaining traffic directly. These notices will be of a month i think. So, overall, it is going to delay. I am trying to get the reason why PTA has not announced it officially…

  • Qazi Hassan

    Hi Tareeen,

    Why Y’day or today PTA didn’t announced ICH do you have any idea?

  • tareeen

    pta has already announced with lot of uncomforts , all LDIS have signed , instructions notices on its way . interest of country is supreme bad people will be always there but look at larger interest .

    • Qazi Hassan

      Dear Tareen,

      Thanks for kindest reply, INSHA ALLAH it will helps our economy.

      Best regards,
      Qazi Hassan.

  • Qazi Hassan

    Salam Everyone,

    The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.13% or 17.99 points to end at the 14,063.08 point level.

    “Investors remained confused after two consecutive days of net foreign selling. Pakistan Telecommunication Company (PTCL) fell after no new developments could be seen on the International Clearing House front.

    Guy’s what’s going on?

    Best regards
    Qazi Hassan.

  • Qazi Hassan

    Above mention Report : Published in The Express Tribune, May 18th, 2012.

  • Qazi Hassan

    Dear Tareen,

    Have you got any news ?

  • tareeen

    no speculations here , what you expect everyday ? Ldis have signed means signed , why confuse your selves ?

    Have you heard any reversal or anything like that ?.Pick up phone and just call the department at ptcl or PTA and get your answer its simple as its .Numbers are there on web site . And confirm to all of us here !
    I ve done my excercise pl do yours , just pick up phone !

  • Qazi Hassan

    Dear Tareeen,

    Actually few months ago i bought some PTCL shares and today they went down, thats why i asked you.

    anway thank’s alot for your answer :)

    Good day!

    Qazi

  • tareeen

    Ministry of information need to send directive to PTA for this this is where is delay

  • Qazi Hassan

    How long it takes? Does ICH will be implement on 15 June 2012?

    Looking forward to hearing from you.

  • Qazi Hassan

    ICH Follow UP,

    Experts said that on reports of establishment of International clearing house (ICH), the stock price of Pakistan Telecommunication Company Limited (PTCL) has appreciated 54 per cent since 1st Jan 2012. PTA has agreed on establishment of ICH and formal agreement is expected to be signed by the end of this month between PTA and LDI operators. Under ICH arrangement all international calls will be terminated by one LDI operator which is PTCL. Revenue generated through this termination will be shared by all LDI operators according to their market share in LDI business.

    “This news was published in print paper ‘THE NEWS’
    Thursday, 24 May, 2012”.

    Best Regards,
    Qazi

  • Qazi Hassan

    “CORRECTION”

    Sorry above Report was Published in ‘The Nation’ not in ‘The News’ .

  • telco

    any updates dear regarding ich its seems same will happen with this as it is before in 2006 and tareen as you said i call in pta but no one confirm ich news i think this is just rumors nothing will happen

  • Qazi Hassan

    Exactly you are right telco, tareen from where did you get those rumors :P

    • Telecommer

      Right now, most of the aggressive LDI operators are expanding their network to terminate more minutes. This is clearly the sign that ICH is not gona happen soon. PTA has given dates many times in last 2-3 years but it got stuck at the end. Actually, its not that PTA dont want ICH, but its the government that they are interfering. Reason: Money. So it will be very difficult to satisfy all officals “financially” by PTA & LDI Operators.

  • Rehman

    Hi guys, I m reading ur posts since couple of weeks n now I think it’s not a rumor but implementation of ich will take time it’s not that simple to shut all the ldi operators networks and terminate all calls to one endpoint. N yeah pak gov never did anything in favor of Pakistan. I’m in oversease n paying 5-9c per minute to calling card companies n all the profit is going in their pockets. n what our gov is getting nothing just killing ldi operators. God bless Pakistan.

  • Qazi

    I don’t think ICH gonna implement in near future…. it’s all bullshit ….

    What y’all say ??

  • Qazi

    HI Telco,
    How are you? i bought ptcl shares few weeks earlier but their share price went down, it looks like i am going to lose my money :( it’s bad ay,
    do you have any news related with ICH implementation?

    looking forward to hearing from you.

  • Telecommer

    Hi Qazi,

    I am fine, thanks. Well, ICH is not going to happen in next 2 months at-least. But since the government is loosing a lot of funds due to this, then, there must be a limit point when Government will be forced to implement ICH at any cost. At that time, your share values must increase again. I am not good at business and shares but may be you can keep them for some time and as ICH happens, the value will increase.

    Unfortunately, the industy/govenment is highly unpredictable. If it didnt happen this year, then next year will be elections and no one knows, how new government will take this further.

  • Qazi

    Dear Telco,

    Thanks alot for youre quick reply, i will keep my shares for at least 2 more months thank you for your good advice.

    GOD BLESS YOU. :)

  • Telecommer

    Thanks Alot. I hope, i can help you in anyway possible.

  • Qazi

    Thanks my man :) if you’ll have any news regarding ICH please update me.

    Take good care of your self.

    Cheers.

  • Qazi

    Hey fellows, finally PTCL shares price went down :( bcoz of ICHA

  • Telecommer

    Waiting for ICH implementation

  • Qazi

    One of my friend told me ich implementation will be valid from July, 2012 PTA holds ICHA because PTCL still have to pay $ 800 millions by the end of June, 2012. Teleco bro what you say?

  • Telecommer

    It is the end of June and there is no news. Honestly, i dont think it will be implemented in next 6months atleast.

  • Qazi

    Hi fellows,

    PTC is trading at FY13 P/E and dividend yield of 6.7x and 11.9% respectively. That said, recent political uncertainty (resignation of PM) could delay the formation of much anticipated International Clearing House (ICH) project.

    Waiting for y’all reply. cheers

    • Telecommer

      ICH is finally formed effective from 1st- October.

  • Rehman

    Hi telecommer I read some post stated ccp stopped PTA , moit and ldi operators to establish ich as it is illegal to fix rates and allocate qouta… N legal action will be taken if such agreement signed. What do u say

  • Telecommer

    Yes, CCP raised it in Feb also. Now CCP is using its full stength to stop it and govt, MoIT & PTA are doing whatever they can to implement it. Lets see where it ends

  • bob

    hello.. ICH has been signed and will be implemented on 01 Oct 2012. all the objections of ccp was declined because ICH has noting to do with prices in pakistan. ppl from outside pakistan will have to bear the cost.

  • RD

    Whatever the result, the fact is people like me whose sole comfort is talking to your loved back in Pakistan, suffer the most.From 1.5 to 2.5 cents a min my call rates just went through the roof. I was told by my provider that they will charge me 12.5 cents /min !!. That means one thing. I am not going to use the service except for very short durations. India on the other hand ensures that people form outside get very cheap rates (1 cents/min or lower). That way its good for Indians and also for business looking to invest in India. Now the 1st thing a businessman looks at is the expense for communications. Sadly PTCL just doesn’t get it. meanwhile I am just going to skyp.

  • Abdullah

    Brothers !!! any other way of Termination to Pakistan ??????

  • webdaak

    I think with Skype available, those who can will use it to full advantage. For those who have to reach someone in Pakistan on the phone, it will mean higher call rates. They will essentially be paying for the regulators inability to control grey traffic and thus pass on the cost to the consumer.

    Sadly that is way things are in Pakistan at the moment. It is just like those who don’t pay taxes get away with it and those who do are being taxed and hounded even more.