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VoIP Regulation in Pakistan ? A General Perspective Last Updated (Tuesday, 15 November 2005)

VoIP (Voice over Internet Protocol) is no doubt, the most significant invention of Information and Communication Technology (ICT) era. It not only connects everybody across the globe but also promises these services at an affordable rate as compared to when only circuit switched telephony existed. With opening up of Pakistan telecom industry after de-regulation, communication facilities have grown tremendously and VoIP is one of the key catalyst. With every passing day, more and more people are reaping its benefits in the form of accessibility and cheap communication services. Resultantly, internet customer base and teledensity has reached exponential levels. 


Building upon VoIP?s countless features; some unscrupulous elements have started using it for their own benefit, thereby causing loss to national exchequer and to other stake- holders. Clearly, these elements are illegitimate operators involved in illegal termination / origination of international traffic using VoIP. With the advent of technologies such as DSL and VSAT combined with easy availability of VoIP equipment, these individuals use VoIP to terminate / originate international traffic and then distribute it to the destined telephone numbers. They make handsome profits hence depriving legitimate stake-holders of their share in revenue.


Pakistan Telecom Authority (PTA), being the regulator is fully aware of this grave situation and is striving hard to curb this menace with a view to provide level playing field for all its licensees. In order to address the issue of illegal call termination / origination, PTA has issued policy guidelines to ISPs, PTCL, cellular mobile, LDI, LL and WLL operators. This illegal call termination / origination is being done using the services of these operators. These guidelines will not only lay the foundation for PTA?s fight against grey telephony but will also serve as an invitation for all its licensees to come forward and play their part in elimination of this illegal activity.


A set of different guidelines have been issued to all licensees depending upon the nature of their businesses. However, some common points include:


Responsibility of the licensed operators for the correctness of their client?s antecedents and maintenance of updated client records, submission of a summary of clients, falling in specific categories such as heavy users, users with a specific pattern of usage etc, overseeing a particular category of their clients against transportation of voice on data circuits and formulation of their SOPs / procedures to discourage illegal activities and help PTA in their efforts.


In reply to these guidelines, some quarters in industry have shown their concerns. Amongst them is Internet Service Providers Association of Pakistan (ISPAK). Similarly, ? a US based IT company has written a letter to PTA raising concerns about the impact on Pakistan IT industry due to PTA?s directives issued to different operators.


All these quarters have only portrayed one side of the story. Analysis of the other side reveals that all these fears and concerns are baseless as the true spirit of the said guidelines have either been misunderstood or they are trying to make mountain out of nothing. PTA?s directives are not only in line with its policies but are also in accordance with the terms of the licenses issued to its licensees. The requirement of overseeing their customers for transport of voice over data circuits is inline with the licenses issued to ISPs. They have been given license of either Electronic Information Services (EIS) or Non Voice Communication Network Services (NVCNS). Both of these licenses prohibit licensees to allow voice over their data circuits. Sub clause 9.21 of EIS license reads:


?The licensee shall be responsible to make sure that no transmission of voice takes place on the data network through his licensed Electronic Information Services.?


So having these licenses, how can ISP?s claim to do business or provide services to their clients using VoIP? This very claim by ISP?s is improper and if allowed, it will deprive LDI, LL operators of their rightful business for which they have invested heavily.


Since its inception, PTA has always been there for growth of telecom business and ICT in the country. It is particularly concerned about that VoIP which is being used by some illegal operators for illegitimate termination / origination of international traffic involving use of VoIP on commercial scale by setting up of gateways and mini exchanges without a valid license. It is not in the knowledge of general public if; PTA ever has restricted VoIP for individuals using different programs to chat with their loved ones with a personal computer on both ends. The students and researchers are using it for interacting with each other regarding their research purposes without any barriers. Last but not the least, business community all over Pakistan uses it in order to fulfill their communication needs. Legality of VoIP comes into question only when some one exploits its benefits for illegal commercial purposes. PTA?s stance appears to be based on fairness and its determination to eliminate grey market telephony needs to be supported by all players.


Foreign IT companies have raised concerns about economic impact of these guidelines. Their fear and reservations are not based on reality. They can always invest in Pakistan and they will be provided every possible technology they would be requiring for their endeavors. It is only due to PTA?s initiatives that a number of foreign telecom and IT companies have invested heavily in telecom sector. Resultantly we have been able to attract millions of US$ as Foreign Direct Investment (FDI). The share of telecom sector in total FDI during 2004-05 is US$ 494.4 million (32.4%). This shows complete confidence of foreign IT and telecom companies on PTA and its policies. Moreover, telecom services are available easily and at increasingly cheaper rates. Reduced rates have been possible due to open competition and technologies like VoIP. These services are available to everybody in Pakistan as offered by a number of companies who have taken Long Distance and International (LDI) or Local Loop (LL) / Wireless Local Loop (WLL) license. These licensees are ?technology neutral? meaning thereby a licensee can use any technology to offer its services.


It is due to PTA?s policies and sound regulatory frame work which has resulted in remarkable growth in telecom sector over recent years. These policies are supportive to all stake-holders without any discrimination and PTA is there to guard the interest of all players. As such it will be fair to support PTA?s efforts in elimination of grey market telephony.    


Kashif Ghafoor

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