Reliance Jio, Bharti Airtel, and Vodafone Idea (Vi) have been requesting the government and the sector regulator to ask OTT (over-the-top) players to share revenues with them. The request is made by the telcos with a simple reasoning that the OTT players are generating the most amount of traffic on the mobile networks. To ensure that the networks don't get congested, the telcos have to scale their investments, but the revenues are going to the OTT players.
While in the past, this request has been termed as disregarding net neutrality, the industry is now coming to terms with it. Meta official also recently said that as long as the telcos don't discriminate in terms of their reach, then the topic of revenue share is worth exploring. But things aren't as simple. No company would want to lose a chunk of its revenues. While telcos have a fair ground to their request, the OTT players aren't just going to deliver a part of their revenue on a silver platter to the telcos.
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So what's going to happen, and why is it important for you to take notice? Well, if you think carefully, everything comes down to you, the consumer. The consumers are where the revenue is generated from. Be it Netflix, WhatsApp, Telegram, Disney+ Hotstar, or any other OTT player, they make revenues through you. Telecom operators do the same, they sell consumers mobile plans, and generate revenues.
Thus, when the telcos want to earn more directly, they will hike the tariffs, which affects you. But hiking tariffs is a short-term solution, and things don't just end there. When telcos say they want a chunk of revenues the OTT players are making, they are saying they want a chunk of money that you are giving to the OTT companies. What do I mean from this?
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Think carefully. Let's say a scenario emerges where the OTT players are ready to share a part of revenues with the telcos, do you think it won't affect you? Like I said above, no company would want to give a chunk of its money on a silver platter. The OTT players will recover the money they give to the telcos from you ultimately. The subscription prices will simply go up, and that way, everyone of these companies will stay happy. The cost has to come from your pocket, otherwise it wouldn't make sense for the OTT companies to share their revenues.
The talks around this are going on in the industry, and it will be interesting to see if the government enforces the OTT players to share a part of their revenues with the telcos. Note that no OTT player has explicitly said that they would charge consumers more if they were asked to share a part of their revneues. My "assumption" is purely based on the premise that the cost of the business is always to be recovered by the customer at the end of the day, and that this situation would be no exception.
