A new report has surfaced which points towards the reduction of regulatory measures on OTT (Over the top) applications and platforms by the Telecom Regulatory Authority of India (Trai). With the present data, the telecom operators seem to be satisfied with the growing data usage which these OTT applications are driving on their networks, as opposed to their previous stance.
Data Consumption Rising Courtesy of OTT Apps
Trai has said that the increased data usage on these platforms might be a result of an absence of stringent regulatory measures. Notably, Trai will also ponder upon regulating OTT applications for the second time. A senior Trai official told Livemint, “We have reduced the scope of that paper. We have already issued recommendations on net neutrality and previously on differential pricing. Now, very few issues are left with respect to OTT. We have to look at regulatory imbalance (with respect to telecom operators). But telecom operators themselves are saying OTTs are helping data consumption.”
Telcos Take Sigh of Relief as Revenue from Data Moves Up
At present, telecom operators have pivoted from their previous stance. The telecom players, before this were looking at OTT applications and platforms like Skype, WhatsApp, Viber as their competitors which were making a dent on their revenue by providing the same calling or messaging services over their networks without any regulatory measures or levies. On the other hand, the telecom operators had to abide by Trai’s guidelines strictly and also had to pay the decided taxes. However, the tables have turned now as these OTT platforms are driving large volume data on the operators’ networks.
The Trai further said about this new development, “In any case, most telecom operators are giving unlimited free voice calls. So the arbitrage opportunities are reducing day by day.”
The Indian telecom regulator has also approved of the stats saying that telcos now seem to be growing satisfied with the situation as revenue opportunities appear brighter from data rather than from calls. The regulator also said that since calls have mostly been made free by all the telcos, revenue streams are declining in that segment as many would expect.
Trai to Rethink Regulation on OTT Apps
Back in March 2015, the industry watchdog had floated a consultation paper seeking views on whether the OTT apps should be brought under the scrutiny of regulations. Now the Trai also wants some insight into whether or not telecom revenue took a hit because of increased usage of OTT platforms.
However, the data clearly shows that when calls used to be the primary source of income for the operators, this was definitely the case. However, the situation has changed entirely as data remains the top source of driving revenue for the carriers now. In the April-June period, the ARPU from calls for Idea Cellular was Rs 73, while for the data, ARPU was marked to be Rs 82 hinting towards a more data-driven market. In such a scenario, the rise in revenue is obviously being contributed by these OTT platforms.
COAI Adamant About Regulating OTT
Meanwhile, Rajan Matthews, Director General of Cellular Operators Association of India (COAI), said, “It is true the issue around revenue loss has reduced with most operators offering free voice calls. Operators do earn revenue from data being consumed, but they also have to make significant investments in their networks to be able to carry these huge amounts of data.”
Further, the industry body leader argued that these OTT applications must also be brought to the stand and under regulatory measures similar to the telecom operators so that there’s a level playing field.
Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.