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The telcos are set to draw the government and the sector regulator’s attention to the raging debate underway in the European Union (EU) and Brazil on the need for OTT streaming\/communication service providers – who benefit the most from use of telecom networks -- to make a fair contribution for building mobile broadband connectivity infrastructure worth billions of dollars, amid rising costs.
India’s telecom companies will point to the ongoing global consultations initiated by the European Commission (EC) and Brazil’s telecoms regulator, Anatel<\/a>, and also underline the need for OTTs generating maximum traffic on Indian telecom networks to make a contribution to the required infrastructure investments, based on a fair share principle. More so, since the rollout of 5G networks is slated to drive exponential growth in data traffic and entail even heavier investments in connectivity infrastructure in future.
“Worldwide, there is a big debate going on around fair share, and we hope DoT and Trai will take cognizance of the consultations now underway in Europe and Brazil, and similarly explore ways to create a fair share mechanism with the biggest traffic originators to ensure continued investments in next-gen connectivity infrastructure in India, especially as it’s becoming a huge financial struggle for the telcos to shoulder this burden alone,” a senior executive at one of India’s biggest telcos told ET.
A top executive of another leading telco said all operators in India “were aligned” on the matter, and would be writing to the government and the regulator shortly.
“Electronic communications operators, notably the incumbents, call for the need to establish rules to oblige content & application providers or `digital players’, who generate enormous volumes of traffic, to contribute to the electronic communications network deployment costs,” said the European Commission (EC) its consultation paper, titled `the future of the electronic communications sector and its infrastructure’. The EC is the executive arm of the EU, and the comments deadline on its discussion paper is May 19, 2023.
The EC paper has added that incumbent telcos in Europe believe such contribution would be fair as these digital players would, otherwise, take advantage of high-quality networks without bearing the cost of their rollout.
Brazil’s Anatel too is in the midst of a holistic consultation to address the future regulation of digital platforms and the need for fair share, with June 30, 2023, being the stakeholder comments deadline. Anatel’s paper discusses the pros and cons of implementing a regulation that establishes a remuneration for use of telecom networks.
It also poses questions on impact of new business models and players on the digital ecosystem of telecom networks. Anatel’s consultation also seeks to unravel any evidence that telco networks are struggling to process consumers’ data demand.
Back in 2016, the South Korean government had introduced a `sending party network pays’ model that mandated the sending party – as in the OTT streaming or communication service provider – to pay for internet traffic.
Simply put, the SPNP model assumes that it should always be the sending party network —in this case, the apps — who pays for the IP (internet protocol) packet delivery across the interconnect link between two service providers.
Last November, the Cellular Operators Association of India (COAI) – which represents Reliance Jio<\/a>, Bharti Airtel and Vodafone Idea<\/a> – had said that OTT apps must compensate carriers for rolling out networks as they were the ones that used telco network infrastructure the most. The telecom industry association, in fact, had called on DoT to bring OTTs under a light-touch licensing regime and also clearly define communication services to remove all ambiguity.
But big tech players had strongly countered COAI and asserted that OTTs can’t be brought under the purview of telecommunications. The Broadband India Forum (BIF), which counts tech biggies such as Meta, Google, Amazon, Microsoft<\/a>, Intel and TCS<\/a> amongst others as its members, had then said that bringing such players under the ambit of the telecommunication service licence implies that the government alone holds the exclusive privileges to decide, build, develop and operate the OTT apps.