Philippines telcos trade barbs over fraud, lost calls

Philippines mobile challenger Dito Telecom has ignited a war of words with its two rivals after accusing them of losing most of its calls.

In a formal complaint to the Philippines Competition Commission (PCC), Dito has claimed that 80% of its calls to one operator and 70% of calls to the other operator do not get connected.

But the two incumbents, Globe Telecom and PLDT-owned Smart Communications, have counter-claimed that Dito is causing them massive losses by sending huge numbers of fraudulent calls.

Dito has not disclosed when the alleged call failures took place.
 (Source: Fiona Graham / WorldRemit on Flickr CC2.0)
Dito has not disclosed when the alleged call failures took place.
(Source: Fiona Graham / WorldRemit on Flickr CC2.0)

Globe has demanded a 622 million peso (US$11.2 million) penalty for what it says are Dito's weak fraud controls that breach their terms of interconnection.

It said Dito was sending Globe 1000 calls a day that were local calls fraudulently masked as international.

"Clearly, Dito has not only failed to compensate Globe, it has also not taken any serious actions to curtail bypass activities emanating in its network," it said.

Congestion and over-utilization

Smart Communications said Dito had requested extra capacity for interconnection, citing congestion and over-utilization of trunk capacity.

Smart says it had argued that "before asking for extra capacity, Dito should first clamp down on its subscribers who have abused the interconnection framework to make fraudulent international calls to Smart subscribers under local rates."

"Simply put, Dito has failed to prevent its network from being misused for fraud, with Dito SIMs masking international calls as domestic, resulting in huge monetary losses for Smart," Roy Ibay, Smart vice president for regulatory affairs, said in a statement.

In response, Dito has said that the fraudulent calls originated outside its network and that it is "equally a victim of such calls."

Dito has not disclosed when the alleged call failures took place. It did not respond to Light Reading's inquiries.

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PCC chairman Johannes R. Bernabe has confirmed he had received separate complaints from Dito against Globe Telecom and Smart Communications over "possible anti-competitive practice in their interconnection agreements."

Dito chief administrative officer Adel Tamano told local media it was difficult for its subscribers to call Smart and Globe numbers.

"Out of 100 calls that Dito makes to reach out to one of these telcos, only 30 are able to get through. Seventy out of 100 calls are unable to interconnect. For the other one, it's even worse, out of 100 calls, only 20 are able to interconnect," Tamano said.

Dito, a joint venture between businessman Dennis Uy, a close friend of former president Duterte, and China Telecom, began commercial service in March 2021 and now says it has 10 million mobile customers.

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— Robert Clark, contributing editor, special to Light Reading

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