Draft telecom Bill: Trai opposed to regulation of OTT platforms

Has communicated this to the telecom dept

The Telecom Regulatory Authority of India (Trai) is not in favour of regulation for over-the-top (OTT) communication service providers written into the telecom Bill, sources have told Business Standard.

They added the sector regulator had communicated this to the Department of Telecommunications (DoT) during consultation on the draft telecom Bill. The draft telecom Bill, released by the government for public stakeholder comments last month, extends the definition of telecommunication service to include OTT players such as WhatsApp, Signal, Zoom, Skype, Google, and Telegram, which provide (voice or video) calling and messaging services.

The definition was amended after telecom service providers such as Airtel and Reliance Jio had argued for years in favour of the need for a level-playing field since OTT communication and satellite-based service offered audio and video calls and messaging without paying for licence or spectrum.

Based on the draft law, these internet-based service providers will be subject to similar rules as other telecom companies. This may lead to OTTs having to take out licences to operate, and, as licensed entities, potentially share revenue with the government.

Sources said Trai had reiterated its earlier stance, in September 2020, that no regulatory intervention was needed for OTT service, and instead batted for market forces to respond to the situation.

Trai had stressed the moment was not opportune for bringing in a comprehensive regulatory framework for various aspects of services, together referred to as OTT services, beyond the laws existing then.

“We had suggested a relook at the issue may be attempted later on, especially after more clarity in international jurisdictions emerged. This was based on how the International Telecommunication Union (ITU) was studying the issue on a global scale. Since then, the ITU has made no major suggestion to regulate the sector as is proposed to be done here,” a senior official said.

Instead, the ITU has pointed out, in response to new competition from OTT providers, some fixed-line and mobile operators are launching their own OTT service. Many are based on cloud-based OTT platforms to reduce their time to market, he added.

Specific challenges

Another official said Trai had advocated an issue-based approach to policymaking for OTTs rather than a broad move to bring them under the same regulatory umbrella that exists for telecom companies.

“Earlier discussion on the subject had been based on two separate nodes with specific suggestions being made by Trai on each. The latest suggestions have followed that model,” he said.

One node had dealt with OTTs and their impact on traditional telcos. It focused on issues such the similarities and substitutability between telecom service providers and OTTs, regulatory imbalance, and the presence of a non-level playing field.

The second node was based on the economic and security implications of OTT service in the digital and strategic landscape. It was based on lawfully intercepting OTT service, interoperability issues, and access of emergency services from OTT, among others.

Regulator’s stance

• Issue-based approach needed while formulating policy for OTTs
• Not in favour of comprehensive regulatory framework as pushed in the draft telecom Bill
• Studies by International Telecommunication Union point to need for more competition, rather than regulations
• Trai had shot down proposal for OTT regulation in 2020 as well