Premium Numbers and Fraud

AurorA has been in the International Telecommunications space since 1994. Route guides for terminating traffic used to be simple; there was a rate per country to terminate a call to a landline telephone and maybe, maybe a second rate to terminate a call to the new cellphones. There were less than 300 lines on the spreadsheet.

Now, there are carriers whose A-to-Z rate sheet can offer thousands of pricing codes; still the landline rate with perhaps some other routes to major cities and a breakout now for each mobile carrier in the country but there are also an increased amount of expensive premium rates that are a potential risk for fraud.

In Canada and the U.S. in the 1990’s there was an explosion in the use of 900 or 976 numbers to offer premium services at a high per minute call rate that would be charged to the caller on their phone bill. Examples included weather reports, psychic hot lines and especially adult (phone sex) chat lines. The high per minute rates could lead to large phone bills very quickly and scammers would use all kinds of tactics to get people to call these numbers as they would get a split of the revenue from the phone company for each call. Consumers and businesses smartened up and blocked 900/976 number and eventually the Internet came and killed that particular market.

Overseas countries still have premium numbers and they live on through various names; Special Services, Non-Geographic Numbers, Universal Numbers, Telematic Services. etc. These numbers are premium in that usually they are at least ten times the rate of normal termination. They can have some legitimate applications; for example non-geographic numbers refers to a remote number, not tied to a physical destination such as if I wanted a Cyprus number to ring to my cellphone when I was elsewhere so my Cyprus customers could reach me.

They can be used for darker purposes though, through a scam called International Revenue Sharing Fraud (IRSF). In IRSF, the carrier in the far end country that owns the number ranges, leverage blocks of numbers they own by applying higher rates and assigning them to resellers outside of the country. Then hackers obtain these numbers, attack PBX’s and IP PBX’s and then machine generate calls. They then share the burst of revenue generated with the carrier in the country that owned these numbers providing a quick source of cash.

So how can you protect yourself ? It comes down to your own dial plan. You want to make sure that you don’t allow access to any premium numbers with such creative names like those listed above. Secondly , when choosing what international carrier to use to terminate your traffic with, beware of those whose own dial plans are riddled with such premium ranges, even if they seem to have low rates otherwise. It may be an arbitrage ambush. If they have many more premium pricing breakouts that do not exist on other carriers rate sheets you should avoid them. It doesn’t take many calls to the premium numbers to swamp any anticipated savings from using their “low” per-minute rates.

Choose to use a quality, reputable carrier for who you trust with your overseas calls.
Don’t be like those people in the photo when your bill comes in.
If you have any further questions, please feel free to contact us.

Also, thanks to Robert Benlolo of Tata whose expertise in this field provided me with guidance.

Six Sigma Telecom (or why Quality is paramount over cost)

Over the holidays I was able to catch up on some reading. The book I finished was “Eccentric Orbits – The Iridium Story” by John Bloom. In a future post I plan to give a short review of this book and a few other books on telecom that I have recently enjoyed.

Eccentric Orbits: The Iridium Story

One of the items that struck me in the book was the description of the Six Sigma management philosophy pioneered by Motorola (the builder of the Iridium constellation of satellites) in the 1980’s that was famously adopted by Jack Welch and General Electric in the 1990’s. The focus on Six Sigma is on eliminating defects and reducing variability. It takes its name from statistics, sigma being the term for a standard deviation from a normal distribution.

In layman’s terms Six Sigma can be summed up as “…if you build things that don’t break, you don’t have any costs of fixing them later…”.

This is the central philosophy we have at AurorA and it resonated strongly with me. In our view the concept of Least Cost Routing (LCR) for international voice traffic is outdated, ultimately more expensive and leads to substandard business outcomes. Choosing the highest quality termination, i.e. a direct route that passes true Calling Line ID (CLID), actually leads to better value and over a longer period of time, higher revenue and lower overall total costs.

Direct costs are lower if you choose premium quality over a cheaper but lower quality route. The LCR way will lead to call failures and trouble tickets. Customers will complain.The cost of chasing trouble tickets can be substantial as well as the re-routing necessary until the faulty route is fixed. Customer service staff to take the calls and service technician costs will increase. These costs can quickly eat up the lower rate per minute of the cheap route.

Secondly, only a small percentage of customers that experience poor quality or call failures will actually complain and take the time to put in trouble tickets. The silent majority will simply stop using your service and use an alternative. They will, however, complain internally to their management team about the poor experience.

Top-line revenue will then also decline over time, initially from customers not using your sub-quality voice service, but further once your organization develops a reputation for poor quality. The maxim “How you do one thing is how you do everything” describes that phenomenon. Customers will not renew, or would look more favourably on competitors offerings. One poor niche allows a competitor an advantage and an avenue to exploit.

This is especially true if your customers are enterprise or business customers. Commercial customers demand excellent quality from your entire service offering. International voice termination may be only a small fraction of your portfolio but if they cannot rely on the calls completing each time, every time with superb “pin drop” audio quality than it would reflect poorly on the rest of your service offering.

This is why at AurorA we insist upon serving you with the highest quality, premium international voice termination. The Six Sigma philosophy highlights that the penny pinching of using a LCR is not worth it, and over the long run higher revenues and lower costs accrue from providing superior quality service to your customers.

Treasures Versus Trinkets

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August has been very busy in my household. I have decided to finally clean and de-clutter the entire house; basement, garage, attics, closets .. the works.

There have been many loads brought to Goodwill and Worth a Second Look in Kitchener-Waterloo. I have brought an entire truckload of paint cans, batteries, oil and fluorescent tubes to the Regional dump for proper disposal. Countless items I left at the curb for my neighbours and other KW residents to enjoy. There was no need for a garage sale, some ads on Kijiji ensured that all went quickly.

The rest has then gone out in the weekly garbage.

It was the accumulation of almost 20 years worth of “stuff” from living in our home with my two daughters as they grew up into adulthood. It left me to wonder why I felt such a sense of relief to see it gone, to see our home now clean, spacious and orderly.

I was reminded of a quote by Jim Rohn, “We must teach our children not to spend their money a dollar at a time. If you spend your money a dollar at a time, you’ll wind up with trinkets instead of treasures. You can’t buy much of value a dollar at a time.”

Much of the accumulated stuff, was just that.. trinkets. The things that I treasure are far fewer.. my home itself, and especially the memories of my kids lives growing up here. The day to day experiences, the triumphs and the sorrows of lives shared with loved ones. Being present in those experiences is what I treasure.

Share with me in the comments below what you treasure, and are grateful for this lovely day.

Canadian Telecom Summit

From June 3 to 5 I was lucky to attend the twelfth annual Canadian Telecom Summit in Toronto . Organized by Mark Goldberg and Michael Sone, the CTS brings together the prime movers of our industry for some thought provoking presentations. This year also saw some major announcements from the CRTC and also the Canadian government.

The CRTC issued a new Code of Conduct for the wireless industry to try to reign in some of the worst anti-consumer practices in the industry. Then the Industry Minister, Christian Paradis, sent a clear message to the industry by blocking the Telus proposed purchase of Mobilicity. The direction of the government and the regulator is clearly being signaled as “pro-consumer” which I applaud and support.

I am lucky to have been in the telecom industry for over 30 years and have witnessed incredible growth and advancements in that time period. When the Canadian market deregulated in the early 1990’s I was an executive at ACC. CRTC Decision 92-12 in 1992 opened the door to true long distance competition in Canada and many new entrants such as CallNet, fonorola, STN and ACC fought hard for consumers against the established incumbent telcos.

Fast forward to 2013… all those early long distance competitors are gone, bought by the telcos… our new wireless entrants are all in danger of being bought by the telcos. The Canadian telecom market is controlled by three companies Bell, Telus and Rogers. Some things have changed, some things have not.

Here at Amitel, we support the “pro-consumer” approach, and we strive to earn your business every day. We are proud to compete fairly in the market, using our premium quality as our competitive advantage. We don’t believe in long term contracts, or bundling, or unfair consumer practices.

We look forward to serving you, and being a vibrant part of the Canadian competitive telecom landscape and seeing what the next 30 years will bring.