Response to TRAI Consultancy paper on Regulatory Framework for Over-the-top (OTT) services.
Short link: http://wp.me/p1ZsI2-G5
To Dated 22 April 2015.
Chairman, TRAI India
Submitted by Abraham Paul. P
Ex. VP (TS) SPCNL, SIEMENS ICN Germany/ Director (SC) SIEMENS RHQ, UAE/ GM & SMT TBG, BPL Mobile, India/ TES (I) DOT India.
e-mail: email@example.com Twitter.com/PA_Paul
Subject: Regulatory Framework for Over-the-top (OTT) services.
Ref: Consultancy paper on the above.
Please see my blog: Net Neutrality without hurting Telcos and End users. http://wp.me/p1ZsI2-ES
Answers to the questions in the above consultancy paper.
Question 1: Is it too early to establish a regulatory framework for OTT services, since internet penetration is still evolving, access speeds are generally low and there is limited coverage of high-speed broadband in the country? Or, should some beginning be made now with a regulatory framework that could be adapted to changes in the future? Please comment with justifications.
Answer 1: Yes. Some beginning should be made now with a regulatory framework that could be adapted to changes in the future.
INTERNET is the best thing happened in the world of communication technology. INTERNET came into existence like a by chance bastard with no regulatory control in place and it is almost impossible to fully reign in now.
It so happened, that openness is main strength and virtue of Internet that make it a boon to ICT as a whole; anything done to restrict it will fully defeat it.
Internet being an umbrella system that nurture everything under it without discriminating what, why, who, secure or unsecure, good, bad or ugly and what not; thus making it a boon to most but can also be bane to many.
Security and discreteness being important requirements in any business, same shall be applicable in Telecom business also. Though telecom operation by nature is interworking between domains of different service providers, there shall be clearly defined business practices in using others resources and customer base.
The way out is not to remove openness of Internet but to regulate its access at subsystem level where it infringes into areas of business of other licensed service providers without appropriate business understanding with them.
World wide web being like one big sea, and information interchange happen in pure chance manner In millions of alternate paths, it is impossible to bring this regulation within itself. However, while trying to regulate externally, it should not totally turn it to something else that curtail its openness which is its main virtue.
The only way to do this is by creating subnets as regulated INTRANET CLOUDS below it keeping World Wide Web intact at the top level.
Analogy can be in viewing INTERNET as a universal train, INTRANET CLOUDS as Cabins attached in it. Travelling between CLOUDS can be done by entering and existing world wide web as happening now without any problem.
So if it is found that something needs to be done, it should be in the peripheral networks and not in the Internet. It may be kept in mind this discussion is only about OTTs who are using TSPs network or switch in their service delivery encroaching TSP’s legal business without clear understanding between them. All other Internet services for PSTN/PLMN shall continue in the same way as it is without hindrance.
Please see a simple schematic on this given below.
Question 2: Should the OTT players offering communication services (voice, messaging and video call services) through applications (resident either in the country or outside) be brought under the licensing regime? Please comment with justifications.
Answer 2. Yes. (Conditionally of course.)
ITU-T regulates Telephony, ETSI regulate Mobile telephony and defines rules about access and controls. Having in place such well established system of fully regulated Licensed Telecom service providers handling Voice, messaging and video cal services, it becomes unfair to the principle of level playing that OTT services offering same services over the top OTT mode remain un-regulated and unlicensed and treated differently.
Question is how OTT players using WWW can be brought under licensing regime by some country somewhere unless there is scope to regulate ‘world wide web’?
Earlier Telephone exchanges handled only voice calls, Telegraph managed text messages and TELEX handled text between Tele-printers. Then came dial up access that provided 64kbps pipe for Voice and Data. Digital land line and mobile phone exchanges provide access for Voice, FACSIMILE and Data and access to Internet through ISPs.
With advent of Word wide web, things have changed a lot. The omnipresent and omnipotent world wide web that caters for almost all needs of everyone without barriers, time, place or distance with no bias to any one, has made it look like the old regulatory regimes impediment to progress.
Can we go back and say Telephony systems shall handle only Voice, not Data or transact Data only between the subscribers of PSTN/PLMN? Perhaps not.
Question 3: Is the growth of OTT impacting the traditional revenue stream of TSPs? If so, is the increase in data revenues of the TSPs sufficient to compensate for this impact? Please comment with reasons.
Answer 3 – Part 1. Obviously, Yes.
Growth of OTT impacts the traditional revenue stream of TSPs.
It is a natural consequence of technology advancement.
Reasons: No one can stop advancement of technology and changes that happen too quickly now. It is a fact that advancement in technology and convergence of Voice and Data had adverse impact on Telecom business. This major shift of Voice based usage to other high speed Data and multi-media services over Internet took the business away from Telecom Service providers to external digital, multimedia and various mobile managed e-commerce service providers and along with it went out a major chunk of its revenue.
Please see my blogs: ‘Impact of transition from Voice to Data & Multimedia. http://wp.me/p1ZsI2-23 and It is suicidal for Telcos to allow banking industry hijack pay by phone VAS. http://wp.me/p1ZsI2-d
Answer 3. Part 2. Does the increase in data revenues of the TSPs sufficient to compensate for this impact?
Depends on what the Telcos and OTT combined business models are.
Reasons. OTTs by nature are using TSPs overall infrastructure network and customer base in carrying out their business. Otherwise, it will not come under OTT category.
Here comes the need to look at the term “Net neutrality” in a different perspective.
From the point of view of TSPs, can Net neutrality shall also mean: Method of call charging of Telephony related services shall be NEUTRAL to the type of system that handles it. It means, be it that the service is rendered over Land line systems, Mobile Phone systems or IP based systems which include Internet & OTT players; same method of charging shall apply and of course, leaving the competition in the market place to decide it.
Such an ideology of with understanding of all stakeholders involved can turn Net neutrality as an advantage to Telecom Service Providers.
Please see my paper: Net Neutrality without hurting and safeguarding End users http://wp.me/p1ZsI2-ES
Average holding time of IP related Telephony calls over circuit switched paths with in the telecom system being about 6 times that of voice calls; charging and billing of such calls based on the call duration according to various tariff package can generate enough revenue of the TSPs to compensate for the impact of OTTs poaching telephony related services from TSPs.
In order to realize this, the basic need is to make OTT players as licensed service providers. Like ISPs, all OTTs shall be subscribers of one or many Licensed Telecom Service providers and access to OTT players shall not be on toll free basis.
In addition to the above, by making OTTs licensed and subscribers of TSP’s a revenue sharing model can be established between the OTTs and TSPs using ‘payment gateways’ to apportion and share revenue between various stake holders that can further enhance revenue of TPSs thus converting the set back of #Network neutrality as an advantage to TSPs.
Question 4: Should the OTT players pay for use of the TSPs network over and above data charges paid by consumers? If yes, what pricing options can be adopted? Could such options include prices based on bandwidth consumption? Can prices be used as a means of product/service differentiation? Please comment with justifications.
Answer 4: As already answered in Answer to Questions 1 & 3.
As average holding time of Data calls is about 12 minutes, charging by duration of calls can generate enough revenue. Tariff can be kept low and without looking into data volume so as not to burden the consumers. Additional revenue can be earned from connectivity charges and revenue share with OTT players.
Question 5: Do you agree that imbalances exist in the regulatory environment in the operation of OTT players? If so, what shall be the framework to address these issues? How can the prevailing laws and regulations be applied to OTT players (who operate in the virtual world) and compliance enforced? What could be the impact on the economy? Please comment with justifications.
Answer: 5. As already answered to Question 3.
Question 6: How should the security concerns be addressed with regard to OTT players providing communication services? What security conditions such as maintaining data records, logs etc. need to be mandated for such OTT players? And, how can compliance with these conditions be ensured if the applications of such OTT players reside outside the country? Please comment with justifications.
6/1: Security is a major concern. This can be fully addressed only when India has its own INDIA-CLOUD below World Wide Web for insulating the country as I have written in my blog: Exclusive Govt. owned GSM Systems & Networks for Administration and Crisis / Disaster management. http://wp.me/p1ZsI2-dh
Moreover, making OTTs as licensed players and making it legal subscribers of one or of many TSPs, some of the security concerns can be addressed.
Ans. 6/2. As mentioned under Answer 3; OTTs are made licensed and legal subscriber of a TSP call data records for all data calls on circuit switched paths shall be available.
Ans. 6/3. There shall be a universal agreement that every OTT player that wants to handle Telephony related service like switching voice calls in VOIP mode shall be licensed and become subscriber of a PSTN/PLMN within the country or anywhere. There shall be methods to refuse access unlicensed OTT players through TSPs in TSPs and associated ISPs. How to ensure this is the question?
Charging, billing and apportioning of revenue share shall be done by associated payment gateways as being done now in Roaming houses as the calls handled via ISPs which are licensed subscribers of TSP involved. (See the schematic in Answer 1)
Question 7: How should the OTT players offering app services ensure security, safety and privacy of the consumer? How should they ensure protection of consumer interest? Please comment with justifications.
Answer 7: Same as given in the answer to questions 3 and 6 above.
Question 8: In what manner can the proposals for a regulatory framework for OTTs in India draw from those of ETNO, referred to in para 4.23 or the best practices summarized in para 4.29?
And, what practices should be proscribed by regulatory fiat? Please comment with justifications.
Answer: 8. India will have a billion phones soon. E-Commerce, Pay by phone services are growing enormously and Direct beneficiary transfers to Mobiles etc in the anvil. So India should take a lead in these things. Please see what I have been propagating over a decade for an ‘Exclusively banked Universal Money Management by Phones system’ in the link http://wp.me/p1ZsI2-4g
My point is, instead looking into other countries; India should come up with ideas that are suitable for us. As may be seen in my papers mentioned above, India is in urgent need of an India cloud with required number of GPS satellites systems and networked across the country. For security reasons it shall be fully firewalled and the server part of all important systems shall be under this cloud so that these can be properly regulated.
Question 9: What are your views on net-neutrality in the Indian context? How should the various principles discussed in para 5.47 be dealt with? Please comment with justifications.
Answer 9: As mentioned earlier, Net-neutrality in Indian context shall mean that as far the end users as consumers of the service, all forms of technology advantages shall be made accessible and at affordable cost to them while safe guarding the business interest of the Telcos and ISPs involved. It is therefore, there is some justification of considering that net-neutrality shall mean providing services rendered through every network; Land lines, Mobile Phones, Computers and user end devices on identical mode of charging on ‘same service – same charge’ basis making it network neutral.
Nevertheless, there shall be different tariff plans based on the level of service and then left to the market place so that competition based on quality and efficiency will decide the pricing. If this can achieved it will be a win-win solution for the service providers as well as for the consumers.
Question 10: What forms of discrimination or traffic management practices are reasonable and consistent with a pragmatic approach?
What should or can be permitted? Please comment with justifications.
Answer 10: Partly answered under previous questions. In addition to that please see my blog: Net Neutrality without hurting and safeguarding End users http://wp.me/p1ZsI2-ES
The traffic management shall be based on the fundamentals of Telephony lest the entire system can fail. With average holding time of data calls being 12 minutes, it is only any body’s guess if huge volume of traffic 0.2 TU per line on toll free access lines can create in telecom system and network. The switch will fail due to overloaded no time and make every other system in the network to collapse due to overcrowding junction routs.
The real solution is in Telcos switching over to IP based switching making TSP & ISP rolled into one; which is going to take time.
The pragmatic way is as suggested by me earlier to convert the net neutrality issue an advantage to TSPs by deriving adequate revenue to prevent them collapse and go out of business.
Question 11: Should the TSPs be mandated to publish various traffic management techniques used for different OTT applications? Is this a sufficient condition to ensure transparency and a fair regulatory regime?
Answer 11: For this it is necessary to define these techniques. It was the practice with DOT to make the TRC issue specifications and standards for everything related to Telecom. Every TSPs are obliged to follow these specifications, rules regulations and conditions. There is an Acceptance Testing department under Technical & Development Circle to ensure its compliance. (I worked in that unit for over 20 years.)
Question is how it can be applied to OTT players that are not licensed? Please see more on this in my noting under Question 20.
Question 12: How should the conducive and balanced environment be created such that TSPs are able to invest in network infrastructure and CAPs are able to innovate and grow? Who should bear the network upgradation costs? Please comment with justifications?
Answer 12. Please see my noting under question 20.
Question 13: Should TSPs be allowed to implement non-price based discrimination of services? If so, under what circumstances are such practices acceptable? What restrictions, if any, need to be placed so that such measures are not abused? What measures should be adopted to ensure transparency to consumers? Please comment with justifications.
Answer 13: Please see my noting under Question. 20.
Question 14: Is there a justification for allowing differential pricing for data access and OTT communication services? If so, what changes need to be brought about in the present tariff and regulatory framework for telecommunication services in the country? Please comment with justifications.
One of the advantages consumers find in OTT communication service is availability of features by which they can communicate each other at no cost or negligible cost.
Ideally net neutrality shall mean same tariff for same service irrespective of which network the consumer use for getting the service. However, it need to be discriminated based on availability, speed of access, quality of service, and flexibility users comfort such universal accessibility over mobile devices. Finally, competition in the market place shall decide pricing on each of the above.
As mentioned in earlier answers, there can be generally three methods of charging the OTT communication.
- Based quantum of data transacted over OTT
- A single unit access charge after an initial charge free duration (As success or failure of the call cannot ascertain in data calls) and Unit charges for the remaining duration of the call.
- Revenue is realized by revenue share from OTT player and no charge from the TSP side in the principle of ‘’Called party pays basis” treating OTT player as the Called party. If none of the above is practical, TSPs may think of increasing monthly rent of the users who all need data access to OTT players.
In order to keep cost to user low, the tariff shall be such that it do not cause heavy burden on the consumers. As considerable percent of users being from the lower social & economic strata, who may not need data access, there can be given discriminative service without Data at cheaper monthly rent as already being done. There can be lower rental for rural and village customers both on rental as well as data service.
Please see my notes in answer to question 20.
Question 15: Should OTT communication service players be treated as Bulk User of Telecom Services (BuTS)? How should the framework be structured to prevent any discrimination and protect stakeholder interest? Please comment with justification.
Answer 15: Please read my blog: Segregation of Service Provision from Network operation / Universal Numbering Plan. http://wp.me/p1ZsI2-t
Question 16: What framework should be adopted to encourage India specific OTT apps? Please comment with justifications.
Please see noting in Answer to Question 20 wherein I have explained about India Cloud and exclusive IP based OTT server.
Question 17: If the OTT communication service players are to be licensed, should they be categorized as ASP or CSP? If so, what should be the framework? Please comment with justifications.
Answer 17. Yes. Otherwise, TSPs have no contractual obligation to provide access to and from OTTs through their network or direct to their switches. It can be contested in Courts.
Question 18: Is there a need to regulate subscription charges for OTT communication services? Please comment with justifications.
Answer 18. If direct access is given to OTT servers through circuit switched paths it shall treated and charged as PABX lines.
Question 19: What steps should be taken by the Government for regulation of non-communication OTT players? Please comment with justifications.
Answer 19. The question is why non-communication players are OTTs and whether they use TSPs network and switching system to get access in any process of delivery of service. The only way to discriminate it is by filtering it at ISP stage in case of Internet access from PLMN/PSTN. All Internet services to non-communication OTT players shall continue. That is what ISPs and Internet is meant to for.
Question 20: Are there any other issues that have a bearing on the subject discussed?
Please see my blogs below: With IP based switching and Networks going to be the future, the Telecom systems as of now will not last long. Government and regulators should have kept in mind this while revising the licenses and selling out spectrum at high cost to Telecom Service providers.
Please see my blog: Who need Spectrum; How much, Where and When? http://wp.me/p1ZsI2-82
- Indian air space is allowed to be crowded by various international players like Skype, Viber, WhatsApp, Chat On, Snapchat, Instagram, Kik, Google Talk, Hike, Line, WeChat, Tango, ecommerce sites (Amazon, Flipkart etc.),Ola, Facebook messenger, Black Berry Messenger, iMessage, online video games and movies (Netflix, Pandora) as mentioned in Para 2. of the TRAI’s CP on this. One of them yet have own spectrum in this country. They manage riding over TSPs systems, network and spectrum.
It is also possible that they sneak into Mobile networks using methods such as emergency access to any available network without SIM that is mandatory in Mobile telephony. It is evident from the fact that we able to access some of these services from mobiles without SIM.
As we have seen it is not possible to reign in Internet and its openness. A long term solution is in all TSPs switching over to IP based systems and networks. Eventually it will happen but it is going to take time. Even with that consumer access to mobile systems will be over legacy and new generation networks using appropriate and adequate spectrum. Whether TSPs will be able to hold on to their business till then is to be seen.
- Another solution to reduce burden on TSPs by segregating Network operation from Service provision as explained in my blog in the link http://wp.me/p1ZsI2-t With most of even voice calls, messaging and data and multi-media related services are being handled external to local system the Traffic pattern is becoming totally different. Traffic is on the increase due to low user charger and higher penetration to other areas of Telephony and non-telephony related VAS needing more systems of higher capacities and networks. Technology is changing fast and life cycle of systems, H/W as well as S/W are becoming less and less. TSPs are already finding it difficult to balance between CAPEX + OPEX and Earnings.
The idea is to have few major network operators who set up and run the systems and networks on Pan India basis which are shared by various service providers on revenue share basis. This can remove the burden of huge invest cost from the TSPs. This is a far cry.
- Another solution to over come the current problem of OTTs is as I mentioned in my paper ‘Net Neutrality without hurting TSPs and safeguarding interest of Consumers’ http://wp.me/p1ZsI2-ES
The idea is to bring in some form of regulatory measure by bringing the OTTs under it. This cannot be done as far the operations remain fully through internet in the world wide web.
Please see the schematic below.
4. The way out is to create an India Cloud and provide and bring in OTTs operating in India and abroad through it. Consumers interact with OTTs and vice versa via the Internet cloud.
Each OTT shall have specific IP address for its URL.
There shall be payment gateways under the India Cloud that will enable TSPs to derive share of revenue for the traffic originated from and terminated on it. For direct access between TSPs and OTTs, there shall be enough circuit switched connectivity between TSPs and OTTs according to traffic needs.
In case of entering TSPs via its spectrum, it need be allowed in the basis of treating OTTs as a PABX.
In case of accessing OTTs via ISPs, it shall be through India Cloud with specific IP URL address.
There shall be Payment gateways in set up and serviced the model of Roaming houses for apportioning and sharing of revenue between various stake holders. All call records and statistics shall be available in these payment gateways.
Separate switching system for catering to OTT players.
As there is enough scope of business that can be done over net, it need to be examined whether there can be a separate switching system can be set up under India cloud that can be legally accessed by licensed OTT players in India via any TSPs network. It is possible by opening out regional roaming feature and option to login to any available network. Access to the system from consumer will be identical to current mobile access to any other TSP system.
Such common switching system will function as switch + ISP + Payment gateway.
Conclusion. Internet is great. Everyone including me would like to continue it the same way. However, as Telecom professional with over 60 years of outstanding experience in the field I consider it my duty to point out the above discriminations and disparities related to the topic under discussion. I understand it is a very complex issue and it will open out lot of unsolvable problems due to the nature of Internet being what it is, good, bad & ugly.
The most scary issue is the security aspect. World over everything is slowly becoming dependant on digitals systems and digital communication of sorts. It is powerful and provides comfort to human kind in many forms and also can become equally disastrous. As mentioned in the first part, controlling Internet is impossible. What I have been propagating for many years is that India should have its own umbrella network set up by GPS linked with exclusive Govt. owned GSM and systems country wide. Good to know that ISRO is already on about it. Hope, the commotion about Net neutrality will get settled and India will march forward as a fore runner in the field of Information Communication Technology.
Abraham Paul. P.
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