TRAI To Reduce Regulation For WhatsApp, Skype As Data Consumption on Apps Rise

Earlier, the telecom operators were pushing for a regulatory framework around OTT players alleging that they were cutting telecom revenues in the voice call and messaging segments.

The Telecom Regulatory Authority of India (TRAI) has decided to reduce regulatory framework for over-the-top (OTT) communication platforms such as WhatsApp and Skype as they drive data consumption on networks.

The rise in data consumption on telecom networks because of such apps may be a result of less regulation on such platforms. TRAI will seek views on regulating OTT players for the second time.

“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,” a senior TRAI official told the paper.

OTT refers to applications and services that are accessible over the internet and ride on operators’ networks.

Earlier, the telecom operators were pushing for a regulatory framework around OTT players as they saw applications like Skype, WhatsApp, Viber as competitors who were cutting telecom revenues in the voice call and messaging segment. They wanted a level play as, unlike these apps, the operators were subjected to regulatory levies and licensing conditions.

The operators now, however, seem to be content as these applications are driving data consumption on their networks.

“Operators are now happy that data consumption is happening through WhatsApp. WhatsApp calls ride on data and costs very little in terms of data usage. In any case, most telecom operators are giving unlimited free voice calls. So the arbitrage opportunities are reducing day by day,” the official told the paper.

In March 2015, it had floated a consultation paper on whether OTT players offering voice, messaging and video call services through applications should be brought under the licensing regime. The regulator has also sought information on whether OTT growth was affecting the traditional revenue stream of operators, among other issues.

Back then, voice calls accounted for a relatively larger share of a telecom operator’s revenue. While it still continues to be an important source of revenue, operators are now focusing more on data. In the April-June period, the average revenue per user (ARPU) from voice was Rs 73 for Idea Cellular, while data ARPU was Rs 82. The rise in operator’s revenue stems from an increased data usage on account of these apps.

Some telecom operators are still of the view that a level playing field needs to be established.

“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. We want the same service, same rule. If these apps are not subjected to levies on revenue that they earn, then that should apply to us also. Apart from this, there should be a level playing field when it comes to legal enforcement,” Rajan Mathews, director general, Cellular Operators Association of India (COAI), told the paper. – Money Control