Big Relief for OTT Platforms as TRAI Says No to Regulations

A huge win for OTT platforms

Telecom Regulatory Authority of India (TRAI) on Monday ruled out binding OTT platforms under any form of a regulatory framework for issues related to privacy and security. TRAI stated that the matter of privacy concerning OTT services is being examined by various international jurisdictions and no satisfactory conclusion has emerged yet.

“It is not an opportune moment to recommend a comprehensive regulatory framework for various aspects of services referred to as OTT services, beyond the extant laws and regulations prescribed presently. The matter may be looked into afresh when more clarity emerges in international jurisdictions particularly undertaken by the ITU (International Telecommunication Union)”, stated TRAI.

Monitoring market developments key for regulatory intervention in future

In its recommendations submitted to the Department of Telecommunication (DoT) on Monday, the telecom regulator also added that market developments need to be monitored and only if required, a regulatory intervention can be made at an appropriate time.

Telecom regulators suffered major revenue loss

Telecom operators raised this issue around 5-6 years ago when it demanded that OTT players should be brought under a regulatory framework called “one service, one rule”. However, times were different back then with data being quite expensive, with approx charges like almost Rs 50 per GB. Hence, subscribers shifted to using OTT services to make voice calls, causing major revenue loss to the telecom operators.

Massive data usage helped in reducing telecom revenue loss

Telecom service providers responded to the change in consumer preferences and slashed their prices to around Rs 3-5 per GB of data. Subsequently, data usage exploded along with the rise of several entertainment OTT platforms. This resulted in the original revenue loss to become much less severe.

With this backdrop, the telecom operators contended that while they paid for spectrum and other charges, the OTTs were free from this burden and did not pay any regulatory charges. However, most of the internet activists and associations like IAMAI, NASSCOM, US-India Business Council, etc, represented the digital application providers and argued against any kind of regulatory framework for OTTs. 

OTT service providers and mobile operators cant be considered equal

The OTT players had maintained that their services cannot be considered on the same pedestal as the mobile operators. This is because the OTT services make use of IP networks and there is no dedicated end-to-end channel that is established for the communication.