KARACHI – Stringent measures, to curb the grey traffic of Pakistan Telecommunication Authority (PTA), are likely to spur a 1.1 percent rise in Long Distance International (LDI) revenues of PTCL in the Financial Year 2011.
This rise, subsequently, is expected to grow at a compound annual growth rate of 3.1 percent from FY10 to FY13, while different monitoring measures have already improved LDI traffic on PTCL’s network – forcing a 26 percent annual rise in FY10 revenues. LDI operators’ returns are based on Approved Settlement Rate (ASR), determined by PTA.
Faisal Khan at AHL said that revenue from LDI declined from Rs 9.9 billion in FY07 to Rs 5.6 billion in FY08 due to a reduction in ASR and a rise in grey traffic. Considering this bleak situation, PTA streamlined settlement rates, increasing them from US cents 7.5/min to US cents 10/min, revising APC to US cents 5.0/minutes.
In addition, PTA deployed Monitoring and Reconciliation of International Telephony Traffic (M&RITT) systems, helping in the detection of illegal call terminations. This resulted in LDI contribution in the total telecom sector revenue, growing from eight percent in FY08 to 13 percent in FY10. PTCL, in order to impede the declining revenue trend from LDI operations, introduced economical packages for international dialing, in addition to revision of its international dialing tariff, he added.
Scenario for LDI operations changed completely after issuance of licenses in 2004 by PTA. Before the deregulation of the telecom sector, PTCL used to manage all LDI traffic, being the sole operator and government owned entity. PTA issued 14 LDI licenses in 2004, out of which nine are currently active. LDI licensee is responsible to maintain and operate a public fixed switched network for a nation-wide long distance and international telephony service.
A total of 3.2 billion international outgoing minutes have been recorded in Financial Year 2009-10 by all nine Long Distance International (LDI) companies, generating revenue of Rs 47.06 billion. Last year, the LDI industry following investment of $183.1 reached the all time highest number of International outgoing traffic minutes, due to competitive international tariffs offered by various operators.
According to the Pakistan Telecommunication Authority (PTA) annual report 2009-10, 9.43 billion outgoing international minutes have been recorded in last five years, from 2005 to 2010, while the number has significantly grown in the past two years. Total revenue, generated by LDI industry in the said five years, stood at Rs 139.78 billion, out of which Rs 47.96 billion was generated in 2008-09, while Rs 21.98 billion was generated in 2007-08.
Major LDI players include Pakistan Telecommunication Company Limited (PTCL), Link Direct, Wateen, World Call, and Telecard. The LDI industry has invested heavily in infrastructure and is paying a reasonable amount through taxes.
