Ott Services in India: U K Srivastava

OTT SERVICES
IN INDIA
U K SRIVASTAVA
Principal Advisor (Network, Spectrum & Licensing)
TRAI, India
Some Relevant Quotes
“An entrepreneur searches for change, responds to it and exploits

opportunities. Innovation is a specific tool of an entrepreneur hence
an effective entrepreneur converts a source into a resource.”
— PETER DRUCKER
“Laws should be like clothes. They should be made to fit the people
they are meant to serve”
— CLARENCE DARROW
2
What is Over-The-Top
(OTT)service?
• Applications and services which are accessible over
the internet and ride on operators’ networks
offering internet access services
• Three types of OTT– Communications, Video
content, Application eco system.
• Two broad categories of services– communications
& non-communications
• Three broad public policy issues- Regulatory
imbalances; impact on economy & Security issues. 3
Growth of OTT….
• The rapid growth of OTT services has raised a
number of national policy issues relating to
regulatory imbalances & security concerns that
need to be addressed.
• The regulatory imbalances need examination at
various levels by different agencies of
Government.
• In addition, public safety and privacy issues
require attention.
4
International Messaging
Traffic- SMS vs OTT
5
Network Operators’ Revenues
Lost to OTT Players
• $52bn revenues are estimated to be “lost” to OTT VoIP globally in

2016
• Over $40bn SMS revenues lost to OTT social messaging in 2014
6
Services available on the Internet
Source :Detecon Consulting

Regulatory Imbalances
Area of Regulation Telecom Service Providers OTTs
Spectrum allotment Need to bear costs and adhere No such costs

and use to rules
Licensing Yes, different licenses and their No such licenses or costs
associated costs including
licensing fee
Spectrum related Need to bear the costs No such costs
charges
Space related charges Need to bear the costs No such costs
Bank Guarantees to the Yes No

government
Proper record keeping Required Required through other acts
including methodology
Interconnection Yes, required as part of No such interconnection
regulatory regime. Requirement required as they are ‘Over the
8
to interconnect entails costs. Top’ networks
Regulatory Imbalances
Area of Regulation Telecom Service Providers OTTs
Quality of Service Required as part of regulatory No such requirement

Parameters regime
Obligations under Need to adhere to rules No such requirement
various Telegraph Acts
Infrastructure sharing Need to bear the costs No Infrastructure sharing
Security conditions Need to adhere to rules No such requirement
Emergency and Public Need to adhere to rules No such requirement

utility services
Monitoring services i.e. Required as a license condition No such requirement
Lawful interception
and monitoring 9
National Security concerns of OTT players
providing communication services
The biggest security threat is from the

select off-shore OTT communication
service players which are highly capitalized,
global monopolies and today control
multiple million customers across
continents.
10
Issues related to security, safety and
privacy of the consumer
• Cultural sensitivity and diversity as most of the OTT

players operate from outside the country
• loss of content privacy & compromised cyber security
leading to cybercrimes
• free apps share the personal information with various
third party developers
• In constant ‘always on’ connections, what information is
being collected by mobile apps.( Big data)
• Cyber predators, bullies, stalkers are all online waiting to
find their next victim. ( Child abuse ..)
11
International Legislations
Singapore France & Spain UAE USA KSA
• Specific • OTT providers • OTT only • New FCC draft • OTT allowed
licenses for are blocked allowed if rules was only to work
VoIP when offering they work released on with licensed
connecting to voice services with licensed March 12, telecom
PSTN that connect telecom 2015 (will companies
to the PSTN companies take few years
to be
finalized)
12
Present Status in India
• There has been a rapid proliferation of voice, video and OTT

application services being delivered over networks.
• OTT is the future service model for communications and
media, and for a whole range of other apps like e-commerce,
m-commerce, e-health, e-education, smart grids and the
digital economy in general, playing a vital role in Digital India.
• Encouraging India-specific OTTs will augment the supply of
apps having localised content in various Indian languages.
This will enable home grown OTT services and the services
could be located within the country. These services can pave
the way for a larger ‘Make in India’ programme.
13
Indian Applications
 The Indian app industry has seen around 9 billion downloads

in 2015. (5X more than 1.56 billion in 2012)
 In 2015, the revenue from paid apps is over INR 15 billion
against INR 9 billion in 2014,
 The Indian app market is likely to carry an enormous
opportunity for local, as well as regional apps.
 India’s app economy is already growing multifold with each
passing quarter, and the country’s 3 lakh app developers‘
community is likely to expand drastically.
 By 2017, India is estimated to have the largest developer base.
 4G is going all the way to accelerate the pace of mobile
14
application development in the country.
Government formed committee on
Net neutrality including OTT
The committee recommended (May 2015) the following :
(i) OTT application services have been traditionally available in the

market for some time and such services enhance consumer welfare
and increase productivity. Therefore, such services should be actively
encouraged and any impediments in expansion and growth of OTT
application services should be removed.
(ii) Specific OTT communication services dealing with messaging should

not be interfered with through regulatory instruments.
15
Government formed committee on
Net neutrality including OTT
(iii) In case of VoIP OTT communication services, there exists a regulatory
arbitrage wherein such services also bypass the existing licensing and
regulatory regime creating a non-level playing field between TSPs and OTT
providers both competing for the same service provision. Public policy
response requires that regulatory arbitrage does not dictate winners and
losers in a competitive market for service provision.
(iv)The existence of a pricing arbitrage in VoIP OTT communication services
requires a graduated and calibrated public policy response. In case of OTT
VoIP international calling services, a liberal approach may be adopted.
However, in case of domestic calls (local and national), communication
services by TSPs and OTT communication services may be treated similarly
from a regulatory angle for the present. The nature of regulatory similarity,
the calibration of regulatory response and its phasing can be appropriately
determined after public consultations and TRAI’s recommendations to this
16
effect.
Consultation papers issued by TRAI
• TRAI has issued consultation paper on Regulatory

Framework for Over-the-top (OTT) services on 27th
March, 2015;
• TRAI has issued pre-consultation paper on 30.05.2016 on

net neutrality which also investigate the relation ship
between TSP and OTT content providers;
• TRAI recently also issued Consultation on ‘Internet

telephony’ on 22.06.16; 17
Important issues in CP
• Policy and regulatory environment and need

for regulation
• Security concerns of OTT players providing
communication services
• Issues related to security ,safety and privacy of
the consumer
• Issues arising because of net neutrality
• Network discrimination and traffic
management practices
18
Thanks
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OTT SERVICES

“An entrepreneur searches for change, responds to it and exploits

• $52bn revenues are estimated to be “lost” to OTT VoIP globally in

Source :Detecon Consulting

Spectrum allotment Need to bear costs and adhere No such costs

Bank Guarantees to the Yes No

Quality of Service Required as part of regulatory No such requirement

Infrastructure sharing Need to bear the costs No Infrastructure sharing

Security conditions Need to adhere to rules No such requirement

Emergency and Public Need to adhere to rules No such requirement

The biggest security threat is from the

• Cultural sensitivity and diversity as most of the OTT

Singapore France & Spain UAE USA KSA

• There has been a rapid proliferation of voice, video and OTT

 The Indian app industry has seen around 9 billion downloads

The committee recommended (May 2015) the following :

(i) OTT application services have been traditionally available in the

(ii) Specific OTT communication services dealing with messaging should

• TRAI has issued consultation paper on Regulatory

• TRAI has issued pre-consultation paper on 30.05.2016 on

• TRAI recently also issued Consultation on ‘Internet

• Policy and regulatory environment and need

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