Telecom operators and over-the-top (OTT) communication service providers have submitted differing views in response to a consultation paper released by the Telecom Regulatory Authority of India (TRAI), titled “Regulatory Mechanism for OTT Communication Services, and Selective Banning of OTT Services”. Private telcos including Reliance Jio, Bharti Airtel and Vodafone Idea Limited (Vi) have requested TRAI to bring OTT service providers under the unified licence (UL) regime.
However, tech companies and OTT players have rejected the claims by telcos of them free riding over telecom network infrastructure. These players have noted that on the contrary, they have contributed to the growth of telco revenues. They have also warned that any move to impose onerous regulatory compliances would discourage OTT companies from investing in innovation and new technologies, and compel them to charge consumers for services that are free at present.
In its submission to TRAI, Jio has urged the regulator to recommend that significant OTT players, that generate maximum data traffic, contribute to network costs that are currently being incurred entirely by telcos. Airtel and Vi backed Jio, underlining the need for a holistic policy framework around fair share contribution from large OTT players towards telecom networks. Airtel suggested that the government provide a legal framework to ensure large traffic generations pay a fair and proportionate share to telcos for services provided to them. Further, Jio added that as OTT players gain massive direct/indirect benefits, it would be all the more fitting that they contribute towards the cost of this infrastructure development through direct compensation to telecom service providers (TSPs). Jio suggested that the costs may be decided based on a mutual arrangement between OTT providers and telcos.
In addition, Airtel said that with the launch of 5G and bandwidth-hungry applications/services to come in the future, the need for creating appropriate mechanisms and managing the contribution of stakeholders towards the creation of digital infrastructure needs to be deliberation. The telco added that regulators such as the Reserve Bank of India, the Securities and Exchange Board of India, and the Insurance Regulatory and Development Authority of India have created a virtuous framework that allows innovation and growth of OTT/online players while also ensuring legal and regulatory oversight without disrupting the level-playing field. However, no such regulations have been drawn up for OTTs operating in the telecom and broadcasting sectors which has resulted in a non-level playing field.
Telcos believe that selective banning of websites the the telco/internet service provider end would not serve any purpose. Instead, they have suggested that TRAI urge the government to consider source-level blocking, i.e., directly engage with such OTT service providers/website/hosting servers/platforms for effective implementation.
Meanwhile, tech players have dismissed these arguments, stating that TSPs and OTT players do not enjoy equal rights. Broadband India Forum (BIF), in its comments submitted to TRAI, said that telcos have exclusive rights to interference-free spectrum that give them economic advantages such as high entry barriers, reduced competition and exclusivity in business operations, unlike OTT players who do not have exclusive rights and have no control over how telecom infrastructure is developed or deployed. It added that to put both categories at par is wholly unjustified, arbitrary, unconstitutional, and violative of Article 14 of the Constitution. Further, the Internet Freedom Foundation said that the selective banning of OTT apps might not only prompt malicious actors but even those exploring alternate solutions without any mal-intent may be criminalised.
