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Comment by SonicSoul | Hacker News Reader

so how does not being able to decrypt traffic make them lose money?

Telecom companies which employed tens of thousands mostly young educated because of the massive growth since early 2000s, have been facing now slowdown if not shrinking because most people here are now communicating for free using whatsapp and viber. These companies were doing also nasty things like injecting advertisement codes inside plain html pages to earn money, as most people here are browsing only facebook and twitter which use https, it became harder for them to compensate their losses on their main service (phone calls). They were colluding with the government to ban some chat apps on 3g communication and postpone new technologies like 4g and faster adsl connections in order to make people obliged to return to phone calls. The government knows very well that these companies are too big to fail as they are maybe the biggest employer in the country.

So their answer is corruption/fascism?

> corruption/fascism

that's what we call national security/stability here in the middle east :D. Seriously though, the government and the three telecom companies Orange/Vodafone/Etisalat falsely think that this is a win win situation to save the telecom industry and national security, however when it reall comes to terrorism, you can organize a terror attack using facebook chat without anyone knowing anything about you, maybe even after the attack if you are paranoid enough and take all social engineering precautions.

FWIW this happens in other Arab countries too. In Dubai the same carrier Etisalat got a ban on the audio functionality of mobile apps - no calls on Whatsapp, Viber etc. You can still text though.

I work for a telcom company in Southern Africa. We make billions every year and a lot of that comes from data. Almost nobody makes phone calls these days. When LTE rolled out, the data usage basically doubled. When people have a fast connection they'll use it to watch endless youtube videos and other data hungry apps/services, and they will pay for it.

So if Egypt's telcom companies want to make money, they need to upgrade their infrastructure. A huge initial cost, to be sure. But it will definitely pay for itself, and they will be raking in money before they know it.

> it became harder for them to compensate their losses on their main service (phone calls)

If nobody's interested in voice service and you can't recoup your capital costs, why not just quit while you're ahead and stop providing voice service—thus at least freeing you from needing to pay maintenance on the voice infrastructure?

Do they also block gas because foresting companies have trouble to sell firewood?

Legal intercept requirements cost money for the incumbents. Telcos have substantial legal intercept requirements in all markets.

If new entrants do not need to meet regulatory requirements, they can have substantially lower costs than the incumbents, allowing them to undercut them (for example, free text messaging).

This applies in all markets, such as Air BnB suppliers' avoidance of fire safety legislation that hotels have to meet (and zoning, traffic, etc).

Uber/Lyft's avoidance of taxi legislation, which is not necessarily about medallions. Some markets have licensing requirements which aren't applied to normal citizens (work hours and additional provision on license) [1].

Banking is a perfect example of this. You know those Visa cards that were offered by, say, Disney[2]? Offering a Visa card requires a banking license (which I understand is expensive and awkward), so they white-box an existing bank's cards (Chase does a lot of business here).

New entrants can be reasonably asked to meet the regulations. If they choose to not adhere to local legislation, it is perfectly reasonable to bar them from operating in a market.

There is a discussion on whether or not the requirement is sensible. That's for the locals to decide. With the passing of the UK's Investigatory Powers Act 2016 (Snooper's Charter), look for similar regulatory findings to start happening in the UK if there is significant pick-up of traffic on Signal.

[1] https://www.nzta.govt.nz/commercial-driving/taxis-shuttles-b...

[2] https://disneyworld.disney.go.com/visa-card/

The markup on SMS is massive. Are you suggesting that prices are what they are because of regulatory issues?

Carriers price based on total revenue per subscriber, not just the profit per type of service. So, while the markup on SMS is high (might not actually be high), the RPU (revenue per user) covers total network costs.

As a cost, legal intercept isn't a drop in the bucket, and it has killed many an offering at a telco when they go to the regulator and the regulator says "you have to support legal intercept".

The cost structure behind SMS is typically due to many of the carrier's suppliers charging the carrier per subscriber (or per SMS). This puts a floor on the carrier's cost structure, and encourages them to look at any lever they can pull to keep new entrants out. Legal intercept would be part of the package. I have no idea how big a cost it is, but I would expect it to be a definite profit center for the equipment supplier - regulatory tends to be bespoke, special snowflake software that the customer MUST HAVE or else they will be turned off.

So, once a regulation is in, it's very easy to apply it as a barrier to entry. Imagine a mobile phone company starting up and not offering number portability.

There is even history in the telco market and messaging services, RIM (BlackBerry Messaging) ran into the exact same issues in the Middle East and India over the same thing [1].

[1] http://www.pcworld.com/article/216651/article.html

The majority of telco products have traditional legal intercept baked in already, it's just a licensed feature. While there are additional costs (training, supporting infrastructure for storage, connectivity for government agencies to perform traces etc.), I do question how 'substantial' they are, as opposed to say pure licensing costs of said equipment (a HLR or SMS-C ain't cheap).

That said commercial passive telco probes are horrendously expensive so the devil may be in the implementation details.

With new meta-data retention laws coming into play (i.e. 2 years for Australia).. I'm assuming the costs will be raised significantly. You can read the mandate here -

https://www.ag.gov.au/NationalSecurity/DataRetention/Documen...

"Legal intercept requirements cost money for the incumbents. Telcos have substantial legal intercept requirements in all markets."

Shouldn't cost much at all. I'm assuming they have servers or appliances for monitoring anyway at the points they'd likely implement LE. They just have to use them for it. Many of the U.S. telcos also charge a fee for police monitoring per PDF's on cryptome. The prices looked like they could buy new servers or monitoring gear every time a request happen plus the smaller cost of processing it. I think the L.E. cost is inflated by the companies being heavyweights that inflate cost of most things. It could be optimized like monitoring is at smaller firms.

Whatever. You can't stop the internet.

You block 1 messaging app, and a dozen more take its place.

Not so much that, but a threat to the revenue model of the licensed gsm carriers. Same reason Skype and VoIP is illegal in the UAE.

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