Monday, August 04, 2003

Market Confusions Summarized


Under PTCL monopoly, basic telephony was the right of PTCL alone. VoIP telephony of all kind was defined (wrongly or rightly) as falling under 'basic telephony' and hence it too was a PTCL-only affair. PTCL created PIE which had reasonable bandwidth rates (which looked tremendously attractive given the artificially high prices of non-PIE bandwidth). Creation of PIE forced the ISPs (who wished to remain competitive) to get behind PIE. Once most of the ISPs were behind PIE, PTCL started implementing IP-based blocking of voice sites on its core routers.

ISPs fought PTCL on the grounds that Internet Telephony is different from basic telephony and a service by its own standard and should not be blocked at PIE. PTA was involved who took a confused decision which 'allowed PTCL to block voice till 31st Dec 2002 and allow the sites after this date'.

When the 31st Dec 2002 date passed, the ban remained in place. ISPs approached PTA to ask PTCL to remove the bans which wrote to PTCL to do the same as per its earlier determination. PTCL took the matter to the ministry (essentially denying the PTA's regulatory position -- as well as forcing the market to assume that this is a mock fight between PTA and PTCL) saying that PTA is not a well-formed body (it only has one serving member rather than three as required by the Telecom Act).

The ministry is yet to announce its decision about the row between PTCL and PTA and the issue of accessing voice sites (for PC based call origination) hang in the balance to date. Meanwhile, because of the market forces, ISPs bypassed these silly bans by simple network techniques such as establishing overseas IP VPNs that now allows them to let there users access these sites.

Ever since the monopoly was over, the market was waiting for the 'Telecom Deregulation Policy' which was supposed to open up the competition for basic and VoIP services to many players. Once again, the PTCL allegedly played its cards mischievously. The announced policy totally skipped the issue of VoIP as if it were of no importance. It just talked about basic telephony. The license terms and conditions (upper cap of 6 cents on termination charges, no lower cap on prices offered by PTCL against competition, 50% build up of network infrastructure in three years, very high performance bond, $500K license fee etc.) are designed to ensure that local players dare not enter the market while unreasonable requirement of network infrastructure would keep the foreign players away from the market.

Using VoIP as a technology for origination and termination remains restricted for 'licenced players' (i.e. licensed under the new policy). Internet Telephony (using public Internet for cheap telephony) remains undefined without any clear legislation. PTA says its okay if you talk to someone with your PC over public Internet. PTCL doesn't agree and has banned the sites on its PIE network. ISPs let their users bypass these bans. Unclear legislation also mars the case of roof-top Satellite Internet gateways which were ( in the monopoly era) only a PTCL thing but after the expiration of monopoly, it is no more. PTA is yet to announce any separate policy in this regard.