Trai for setting up industry body for cloud providers within ‘light touch regulatory framework’

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September 14, 2020 9:38 PM

Releasing its recommendations on cloud services, Trai said the Department of Telecom (DoT) may initiate setting up of the first industry-led body in this regard and require all cloud service providers (CSPs) to become its members.

The "essential disclosures", mandated in TRAI's directive, include information on units/volume of voice, data and SMS, and its rates, limits of usage rates and speeds beyond entitled use.

The Telecom Regulatory Authority of India (Trai) on Monday recommended setting up of an industry body for cloud service providers as part of a “light touch regulatory framework”.

Releasing its recommendations on cloud services, Trai said the Department of Telecom (DoT) may initiate setting up of the first industry-led body in this regard and require all cloud service providers (CSPs) to become its members.

“This body would lay down broad principles and procedures to aid its functioning,” Trai said in its detailed recommendations, mentioning also the staunch opposition seen on part of CSPs to establishment of a regulatory framework, during the regulator’s consultative process.

A registered industry body working in conjunction with DoT or TRAI would enable the stakeholders to discover the right spot in the continuum, the regulator said asserting that it does indeed constitute light-touch regulation.

“The industry body so created may review its experience and further deliberate upon the need to form multiple bodies for different purposes, such as to address requirements of different market segments,” Trai said.

Such a review may be needed after two years of functioning of the industry body, or such time as DoT considers appropriate, it said.

The scope of CSPs may be initially limited to providers offering Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) in India or to customers in India, the regulator said.

The category of Software as a Service (SaaS) providers may voluntarily enrol for membership, if they wish, it said.

“Any expansion of scope to mandate membership beyond IaaS and PaaS may be considered by the industry body on need basis and recommended to DoT for acceptance,” Trai has said in its latest recommendations.

Spelling out its suggestions, Trai said channel partners of various CSPs need not be required to take membership of the industry body if their principals are already members. They can, however, seek membership independently also, if they wish.

Telecom service providers should not be allowed to share infrastructure and platform related to Telegraph with a CSP who is not a member of CSPs’ industry body registered with DoT, Trai said.

The regulator mooted that the first industry body could be set up by DoT as a non-profit body in a three-step process — enrolment of CSPs operating in India; formation of an adhoc body to frame broad rules, organisational structure, election procedure; and election of office bearers to take over its functioning as a regular industry body.

The regulator said that during the process of consultation — involving written submissions and open house discussions — in general, cloud service players and their associations had opposed establishing a regulatory framework for CSPs.

“Their opposition to a regulatory framework is on the grounds that they are already subjected to various existing Indian laws, which are IT Act, 2000; Consumer Protection Act, 2019; and the proposed Personal Data Protection Bill, 2019. They also claimed that while cloud computing is provided using the infrastructure of the telecom licensees, it is not a telecom service, rather it is an information technology service,” Trai noted while giving its detailed views on the issue.

They also felt that governance of CSPs in any form falls squarely within the jurisdiction of the IT Ministry which is tasked with developing policies for information technology and the Internet.

The sectoral watchdog further observed that the players had disputed the ambit of Trai to create a regulatory framework for CSPs, arguing that cloud service providers should not be subject to regulation by the DoT or TRAI, directly or indirectly.

Another point raised by the CSPs and their associations while opposing establishing, an industry body was the ambiguity about the meaning of light touch regulation, and in their opinion, registration of CSPs under industry body was, in no way a light touch regulatory approach.

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