Social media intermediaries like WhatsApp, Facebook and Twitter, and over-the-top (OTT) players like Netflix, Prime Video and Disney+Hotstar may have to pay a carriage charge to telecom service providers once the Telecom Regulatory Authority of India (Trai) and department of telecommunications (DoT) finalise the contours of a new regulatory regime encompassing them.
Data, particularly video, comprises 70% of the overall traffic flow on telecom networks, and this would grow further with the rollout of 5G services. With such growth of data/ video, telcos have to keep on increasing their carriage capacity and backhaul networks, which entails investments, and it has been felt they should be compensated for them.
Upon reference from the DoT, Trai is currently studying various possible models under which OTTs can be brought within the purview of some form of regulation. The draft Telecom Bill, too, talks about bringing them under regulation. Sources said once Trai studies the subject, it will come out with a consultation paper to seek stakeholders’ comments.
Communications minister Ashwini Vaishnaw has talked about light touch regulation for OTTs.
Making OTTs and intermediaries pay a carriage charge is not something new, but is based on the principle of interconnection charges applicable to telecom players. Termination charge, a levy paid by the originating network to the operator on whose network the call terminates, was discontinued only in January 2021, when traffic between the three operators more or less became even. Now this levy has moved to a bill and keep principle. But another component of interconnection — carriage charge — still applies. Here, operators pay a charge to the national long-distance carrier for carrying calls from one circle to another.
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Similarly, operators pay each other for points of interconnect, which connect calls between two operators. As subscriber/ call traffic increases, operators need more points of interconnect from each other or else there would be high incidence of call drops.
Sources said while the interconnect charge regime for telecom operators is well designed, how it will apply to intermediaries/ OTTs needs to be decided. “Before Trai comes out with its consultation paper, it will study global trends and come out with a proposed mechanism,” sources said.
According to sources, an interconnect regime is a must between OTTs and telcos because as 5G services grow, there would be immense data/ video load on networks, which may lead to them getting clogged or even crashing at times.
Sources said once an interconnect regime is fixed, it’s quite possible that OTTs and telcos come around to some revenue-sharing mechanism in lieu of paying the charge. If this happens, it would be very similar to the bill and keep regime of termination charge.
Some officials said if the intermediaries/ OTTs are kept out of legal interception and only brought under the interconnect regime, there might not be opposition from sections which are against a regulatory regime for OTTs. “The basic opposition is with regard to licensing and legal interception as the fear is that these may lead to breaking of encryption and state surveillance. However, no such thing applies to interconnect charges,” sources said.