STAFF REPORT IBD: The LDI operators in Pakistan may form a rate consensus strategy fixing the charges on international calls close to ICH levels after the PTA dissolved the International Clearing House.

This would require a strong consensus amongst the LDI operators regarding the fixation of market shares and international call rates without any authority supervising them.

This decision would have its consequences on the profitability of all the LDI operators however, and PTCL to be least affected courtesy a well diversified product portfolio along with the highest market share in the sector.

All is not that simple though as the strategy would require a strong consensus amongst local LDI operators regarding the fixation of market shares and international call rates without any authority supervising them.

To recall, in an effort to maximize their revenues, the local operators have to bring down the calling rates to keep charges at as low as USc1.25/min to stay competitive in the market.

It is to be mentioned here that PTA through a notification has recently dissolved ICH, established on the directives of MoIT.

The withdrawal would bring down the international calling rates to pre-ICH levels (USc1.5- 2/min) amid restart of the price war amongst the 14 LDI operators.

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