CRAN targets OTT regulation

Busines 03 febThe Communications Regulatory Authority of Namibia (CRAN) says it’s investigating the possibility of regulating over-the-top (OTT) services, as it moves ahead with a study that will define the appropriate regulatory framework.
An OTT application is any app or service such as WhatsApp, WeChat, Facebook Messenger, Netflix, Amazon Prime, YouTube, Skype and Facetime, among others, which provides a product over the internet and bypasses traditional distribution channels.
“Although CRAN does not regulate OTT at the moment, CRAN like other regulators around the world is looking into ways on how to regulate OTTs, and enable these services to contribute to the social economic development of Namibia. We will be conducting a study in the near future, to help define the regulatory framework in this regard,” CRAN Chief Executive Officer, Festus Mbandeka, said.
He said the findings of the planned study, will be key in guiding the regulator’s policy, when it comes to OTT services, amid an outcry from local telecommunications providers on the impact of the services on their voice call volumes and OTTs lack of investment in the networks that their services ride on.
“Broadcasters and telecommunication service providers invest millions of dollars in infrastructure and networks, in order to be able to provide services, and OTTs just offer their services over the existing networks.
“OTT service operators are not registered as operating entities within the country, and as such, they do not pay the relevant taxes and licence fees or make any contribution towards corporate social responsibility,” Mbandeka said.
“The authority therefore needs to conduct a study to determine whether the provision of free OTT services represents unfair competition, and if it is detrimental to the development and operations of licensees, CRAN will take the appropriate action, as required.
“The authority should further define a framework for net neutrality regulation, to promote fair competition. Finally, the authority should consider whether OTTs should be required to operate as distinct companies, or through a joint venture, to ensure that the OTTs are subject to national laws on consumer protection, privacy and quality of service and also the payment of relevant taxes in Namibia,” Mbandeka.
He added that the continued advancement in technology, and the continuous changes in their operational structure, also provided a challenge when it comes to putting regulations in place that govern their operations.
“It is common cause that OTTs are not yet regulated or licenced in Namibia, because they fall outside the ambit of the existing regulatory framework. OTTs operate in a forever changing environment, and this makes it difficult for policymakers to keep pace with the developments in the ICT sector.
“This therefore results in ineffective monitoring and interception by law-enforcement, on issues such as quality of service and universal access,” Mbandeka said.
The CRAN CEO also said that OTT services pose a threat to the operations of broadcasters, going forward.
“OTT remains a future threat to broadcasters, in general, with use of set-top box (STB) internet access facilities. This also results in unfair competition. OTTs also have a negative impact on telecommunication service providers, because customers may opt not to pay for TV licences or TV subscription, and may rather choose to stream content online, which may be cheaper, and this will negatively impact broadcasting service providers,” he said.
Mbandeka said the regulator was concerned about the personal information of Namibians, who use OTT services.
“Article 13 of the Namibian Constitution provides for the right to privacy and subsection 1 of that article protects the right to not have privacy of the people’s communications infringed. Privacy is a fundamental right, as enshrined in the Constitution, which should be protected in the interaction of the citizen with the digital world,” he said.
“Telecommunications service licensees have strict data protection and privacy requirements for consumers. OTT players, however, operate on a limited and generally voluntary basis, with no actual protection for consumers. Hence, CRAN is concerned about the protection of privacy, especially because OTTs use and store a lot of data, some of which actually constitute personal data.”
CRAN’s plans regarding OTTs come as regulators in other African countries are also considering regulating options for their services.
According to the London-based research and analytics firm, Ovum, the telecommunications industry will lose a combined US$386 billion between 2012 and 2018, because of customers using OTT voice applications.
Ovum notes that consumer use of OTT, VoIP, will grow at a compounded annual rate of 20 percent between 2012 and 2018, to reach 1,7 trillion minutes, which translates to US$63 billion in lost revenue in the final year of its forecast.