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OVER-THE-TOP (OTT) SERVICES

Over-the-top (OTT) is networking lingo that describes the delivery of content, services or applications over the internet. OTT edge providers typically deliver their content and services to customers on top of network infrastructure that is owned and maintained by internet service providers (ISPs), like Verizon and AT&T.

• OTT communications services – These services (e.g. VoIP) provide real-time person to person telecommunication services. These services are similar to the telecommunication services provided by the licensed telecom service providers (TSPs) but are provided to the users as applications carried over the internet using the network infrastructure of TSPs. Essentially OTT communications services compete with the services provided by TSPs riding on the infrastructure created by TSPs.

• OTT application services – All other OTT services such as media services (broadcasting, gaming), trade and commerce services (e-commerce, radio taxi, financial services), cloud services (data hosting & data management platforms/applications), social media (Internet based intermediary applications like Facebook, YouTube) offer services to end-users using the network infrastructure created by TSPs but do not directly compete with the service offerings for which the TSPs have obtained a licence under the applicable law i.e. the Indian Telegraph Act, 1885.

OTT has witnessed an unprecedented growth in the recent years.

The major factors for this growth have been the rising penetration of smart phones because of declining prices and unlimited range available in the market to choose from, and the up-gradation of access networks by the TSPs.

Digitalization of content has become very common, leading to fall in the level of conservation and reproduction of information and its distribution costs, which in has promoted the explosive growth in the supply of online content.

The broadband networks provided by incumbent TSPs are used as a platform by these OTT players for the development of their new businesses. As these OTT applications have increased the online content, there is now an increasing demand for faster broadband speed to cater to this increased data traffic, that needs huge investments in network up-gradation by these TSPs. At the global level, there is an ongoing debate amongst Governments, industry and consumers worldwide regarding the regulation of OTT services.

In the wake of this debate, TRAI has also released a Consultation Paper on Regulatory Framework for Over-the-top (OTT) services, that will take account of the views of the service providers, OTT providers and various other stakeholders and related issues (including network neutrality), international experience with network neutrality and regulation of OTTs (communications and non-communications).

 

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