SIM Boxing threatens telecoms industry: Derrick Sebbaale

6188843074 33732d198b zAn independent information communication technology ICT consultant, Derrick Sebbaale, stated that in 2016, it was estimated that Uganda telecoms lost about US$60mn due to the illegal redirection of international calls traffic

The amount in part led to revenue from voice services to remain flat or grow sluggishly in 2015, 2016 and 2017, according to telecom revenue analysis in those three years. The illegal redirection is known in technical terms as SIM boxing.

Sebbaale defined SIM boxing as a practice in telecommunications whereby a person or group of people set-up a device that can take up several SIM cards (a SIM box) and use it to complete international calls it receives from the Internet as voice over IP (VoIP) and in turn serve them to the in-country mobile network subscribers as local traffic.

The SIM boxer thus bypasses the international rates and often undercuts the prices charged by local mobile operators.

He explained that if a call from the United Kingdom to Uganda, the subscriber will call via their operator (provider A–i.e. Vodafone) that has an International Gateway (e.g. BICS, TATA, etc.) and has termination agreements with operators in Uganda including network X (could be MTN or Airtel). They send the call via their connections to Network X that looks for its subscriber and terminates the call.

In this scenario, all operators–A, BICS, X and the government receive their fees as per set agreements and taxation laws.

This is the legal mode of operations and guarantees revenue for all parties involved. However, some unscrupulous individuals have found a way around this. The time this issue became rampant or visible, was when the One Area Network (OAN) was launched in 2015, which unfortunately became the transit route for calls originating from other countries.

If someone made a call from the UK to Uganda, on the phone it would be displayed as a call from Kenya because it would have been diverted by some unscrupulous individuals.

The SIM Box has several SIM cards of operators and could also take advantage of any existing on-net (same network) voice bundles and thus ends up paying very little or nothing for the termination of the said call-that is disguised as a local call.

In this scenario, the interconnect operator C undercuts the market interconnect rates and offers cheap rates by spoofing quality. The GSM operator in Uganda (Network X) is cheated of charging the call at premium international rates but rather gets local rates or even earns nothing (if already purchased voice bundles are utilised). The government is also cheated of the US$9 charged on international calls per minute.

This route is also sometimes referred to as the ‘Gray Route’.

So, the telecom companies do witness an increased number of calls due to bundled offers but then this doesn’t translate into increased revenue. That means, there is someone else benefiting by rigging the system.

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