The Telecom Regulatory Authority of India (TRAI) has published a consultation paper on the regulation of over-the-top (OTT) service providers, requesting feedback on how it should approach the sector. The paper highlights several imbalances between telecom service providers (TSPs) and OTT providers, with the former obliged to operate within a regulatory structure that imposes numerous requirements whilst the latter is largely unregulated. The TRAI suggests that the odds are currently stacked against TSPs, which must compete with OTTs for voice and messaging revenue, pointing out that: TSPs bear the burden of investing in network infrastructure; although OTT traffic does drive data consumption, prices for data are rapidly falling, reducing the benefit to TSPs of carrying OTT traffic; OTT operators have access to additional revenue streams unavailable to TSPs, such as gathering and selling – or otherwise utilising – customer data; and OTT providers are able to abuse dominant market positions, but with no mechanism to redress balance.
No specific framework or solution is proposed by the TRAI, though the regulator presents several potential approaches, including those put forward by other regulatory bodies across the world. The approaches broadly fall into two categories, either alleviating the pressures on TSPs to allow them to compete more effectively with OTT providers, or to apply equal regulation to OTT firms. The regulator also noted that a third option would be to leave the issue to be resolved by market forces, suggesting that the pressure from OTT providers would drive TSPs towards innovation and diversification.
The TRAI has invited industry stakeholders to submit comments by 10 December, with counter-comments to be filed by 24 December.