Response to TRAI Consultation Paper on Regulatory Framework for Over-the-top (OTT) Services
Rekha Jain
Radha Ravattu
Rishabh Dara
Pranesh Prakash 
Net neutrality, OTT, India, Regulatory parity, Specialised services
1 Executive Summary
The principle objective of net neutrality is that “all the Internet traffic has to be treated equally without any discrimination”; but this has had different interpretations over varied contexts. While the discourse in India has often treated net neutrality as a singular policy construct, we break down net neutrality to its various components. We then individually contextualise each component to the unique characteristics of the Indian telecommunications industry such as dependence on wireless internet access, the fragmented and non-contiguous distribution of spectrum, high competition between TEL-SPs and low digital literacy. The evolving nature of markets and networks are also considered while taking into account various public policy perspectives.
In this submission, we also argue for the need to introduce reasonable regulatory parity between functionally equivalent communications services provided by OTT-SPs and TEL-SPs. We compare the regulations for OTT-SPs under the Information Technology Act 2000 (as amended) with the regulations for TEL-SPs under the Telegraph Act 1885 (as amended), the license agreements (UL, UASL, ISP-L) and TRAI Regulations. Based on an analysis of the current laws and regulations, we suggest how TRAI needs to intervene to create this regulatory parity (for example in areas such as privacy, spam/UCC, interception etc.).
Through the above analysis, we recommend an overall regulatory framework that should be adopted by the Government. The framework takes a nuanced approach to various components of net neutrality, contextualised to India, and also attempts to bring reasonable regulatory parity. Instead of compartmentalising TEL-SPs and OTT-SPs as two distinct actors, the recommended framework considers a two-layered approach which recognises that there is an overlap between TEL-SPs and OTT-SPs. The first layer comprises of network and infrastructure (collectively called the network layer) and the second layer comprises of services and applications (collectively called the service layer).
The framework further divides the service layer into “Non-IP Services”, “Specialised Services” and “Internet Based Services”. The concept of “Specialised Services”, which is borrowed from the European Union, refers to traditional services that have migrated to an IP architecture such as facilities-based VoIP calls to PSTN and IPTV, and are either logically distinct from the Internet or have special needs which the “best efforts” delivery of the general Internet cannot satisfy. This concept helps in applying different evaluation criteria to functionally equivalent “Non-IP Services”, “Specialised Services” and “Internet Based Services”. In the framework, “Specialised Services” are also recognised as an exception to net neutrality. The concept of “Specialised Services” also helps to create an incentive for continued investment in underlying infrastructure by TEL-SPs.
This framework has helped us to bring a more balanced approach from the perspective of both TEL-SPs and OTT-SPs, while also taking into account technological convergence. It has also helped us to bring a more nuanced approach to various issues comprising net neutrality such as zero rating, paid prioritisation etc. We have considered best practices from different international regimes and the pros and cons during implementation in order to determine the exceptions and boundaries of net neutrality that should be adopted in India.
2 Mandate of TRAI & Framing of Issues
Framing of Issues: Framing of issues is an important part of the policy development process. Recommendations that emerge from a consultation are largely driven by the way issues are framed. In the present consultation, the issues and questions have not been framed neutrally. For example, Question 8 raises a question specifically about the ETNO proposal, while ignoring the other regulations discussed in the same chapter. It is recommended that TRAI take greater care in drafting the issues/questions in the future.
Mandate of TRAI: Section 11 of the TRAI Act defines the functions of TRAI. It is submitted that TRAI should recognise the limitations of its mandate and forebear from providing recommendations on aspects that are outside the scope of its authority. For example, many of the concerns raised in the consultation paper, including issues such as regulation of e-commerce websites and competitiveness of brick and mortar establishments, though valid policy issues, are unfortunately strictly outside the scope of TRAI’s authority. Likewise, it is strongly stressed that the issue of protecting revenue streams of TEL-SPs is outside the scope of TRAI’s authority. It is recommended that TRAI should recognise the limitations of its mandate while providing its final recommendations to the Central Government.
Question 19: What steps should be taken by the Government for regulation of non-communication OTT players? Please comment with justifications.
Question 16: What framework should be adopted to encourage India-specific OTT apps? Please comment with justifications.
It is suggested that TRAI refrain from providing recommendations on regulation of non-communication OTT players. The mandate of regulating such services is that of the Parliament by amending the IT Act and its rules thereunder. While recognising the limitations of its own mandate, TRAI may recommend the need for a new converged regulator and a new converged legislation combining various aspects of Information Technology, Telecommunications and Broadcasting. The issues brought to the forefront by the rise of OTT services require a major overhaul of many related legislations and cannot be entirely addressed by incremental efforts of TRAI.
Question 5: Do you agree that imbalances exist in the regulatory environment in the operation of OTT players? If so, what should 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.
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.
Insofar as the above consultation questions concern non-communication OTT apps, these questions also exceed the mandate of TRAI.
3 Need to Contextualise Issues
Question 9: What are your views on net-neutrality in the Indian context?
One is not simply “for” net neutrality or “against” net neutrality - It’s far more complicated! One has to have a nuanced look at the various components1 of net neutrality, and contextualise these to the unique characteristics of the Indian telecommunications industry and the evolving nature of the technology, networks and markets. Each of these components may relate to multiple public policy issues such as competition, innovation, national security, freedom of expression etc, making any for-or-against stance simplistic and exclusionary.
However, over time, net neutrality has become a political issue wherein a for-or-against stance is necessary. Keeping that in mind, TRAI must, in essence, endorse the overall concept of net neutrality and the open nature of the internet. Any contrary decision could send a wrong signal to activists, investors and friendly countries. Nevertheless, while endorsing net neutrality and an open Internet, TRAI must not fall into the trap of treating net neutrality as a non-violable religion. TRAI must simultaneously recognise that net neutrality, as a policy construct, is not well defined and has different interpretations in different contexts. Specifically, in India, the interpretation of “net neutrality” is definitely a function of the Indian context.
3.1 Uniqueness of Indian Context
Constructs (such as “net neutrality”) developed in foreign policy literature require to be contextualised to the Indian context and should not be adopted directly into the Indian policy regime. India is a one-of-its-kind market with unique characteristics. Some of the unique characteristics of the Indian telecommunications market include:
- Dependence on wireless internet access (in contrast to wireline broadband)
- Limited, fragmented and non-contiguous spectrum available with Indian TEL-SPs
- Low spectrum/population
- High cost of spectrum (price per MHz. per capita)
- Low broadband penetration; Low penetration of 3G and 4G services
- Lack of content in vernacular languages
- Most content is hosted outside the country; most data is routed outside the country
- Low enforcement of IT Act with foreign intermediaries
- National security concerns are higher in India than most other countries
- High competition between TEL-SPs; relatively low switching costs
- Perceived relevance of Internet to a large number of people
- Low levels of digital literacy
- Perceived equivalence of Internet and Facebook+Whatsapp
- High sharing of passive and active infrastructure
3.2 Evolving nature of Technology, Networks and Markets
Technology, networks and markets are constantly evolving at a very fast rate. We capture a few important aspects that TRAI should keep in mind while developing its recommendations:
- Convergence & 4G Networks: With the advent of 4G, networks have finally transitioned from circuit switched networks to fully packet based networks. Like internet based services (e.g. Skype calls), now traditional services (e.g. PSTN voice calling) are also capable of being delivered over an IP based network and may share the same infrastructure as internet based services. India has also moved forward to the Unified Licensing regime in which, the Unified License (with authorisation for Access Services) now allows for interconnection between IP Telephony and the PTSN/PLMN network.
- Evolving Nature of Market & Network: The historical assumption of a TEL-SP only having a relationship with the local subscriber and peering/interconnecting networks is no longer true. Over time, the market for a last-mile network has evolved into a multi-sided market. Besides the “local” side of delivery of internet access services to the subscriber, the TEL-SP also shares a “remote” side with OTT-SPs that are not directly interconnected with the last-mile network. Increasingly, many content providers are now also directly interconnect with last-mile networks through content delivery networks. This evolving nature of the network architecture and market needs to be accounted for in the contextualisation of constructs and issues.
4 Market Failures / Need for Intervention
TRAI, as a regulator, should only intervene in the case of a market failure. In the context of growth of OTT services, the following alleged market failures are identified from the consultation paper and different stakeholder presentations during the open house session.
| Alleged Market Failure | Intervention Requested By | Analysis (Summary) | Need for Intervention | Suggested Intervention |
|---|---|---|---|---|
| Loss of revenue by TEL-SPs | TEL-SPs |
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No | None |
| Incentive for TEL-SPs to roll out network infrastructure has reduced | TEL-SPs |
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No | None |
| Non-level regulatory compliances for TEL-SPs and OTT-SPs | TEL-SPs |
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Yes. TRAI should provide recommendations on this subject under Section 11(1)(a)(iv) of the TRAI Act. | There is need for intervention to introduce regulatory parity between functionally equivalent services provided by TEL-SPs and OTT-SPs. Refer to Section 7 for suggested interventions. |
| Application/service specific discrimination by TEL-SPs | OTT-SPs and Civil Society |
|
Yes. TRAI should provide recommendations on this subject under Section 11(1)(a)(ii) of the TRAI Act. | Net neutrality should be codified and enforced in the license agreements between TEL-SPs and the Central Government. Refer to Section 5 in which various components of net neutrality have been analysed in detail. |
In summary, intervention by TRAI is urgently required for:
- introducing reasonable regulatory parity between functionally equivalent services provided by TEL-SPs and OTT-SPs; and
- introducing net neutrality contextualised to the unique characteristics of the Indian telecommunications industry.
5 Public Policy Concerns
For each of these two interventions, there are additional policy concerns, which should be considered by TRAI in delivering its recommendations:
5.1 Intervention for net neutrality
| Perspective | Rationale for net neutrality | Counter Arguments | Analysis |
|---|---|---|---|
| Freedom of Expression & Human Rights |
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| Competition Policy |
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| Innovation & Entrepreneurship |
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| Signal to Foreign Countries and Investors |
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| Universal Service |
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5.2 Intervention for Regulatory Parity
| Perspective | Rationale for Regulatory Parity | Counter Arguments | Analysis |
|---|---|---|---|
| State Concerns (National Security, Taxation etc) |
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| Consumer Expectations |
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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?
There is need for intervention by TRAI to bring reasonable regulatory parity between functionally equivalent services provided by OTT-SPs and TEL-SPs. There is is also need for intervention to amend the license agreements of TEL-SPs to introduce terms and conditions that codify and enforce a variant of net neutrality that is contextualised to the unique characteristics of the Indian telecommunications industry.
The preceding table in Section 5 for the different policy issues involved in the present consultation demonstrates that the policy problem is clearly of a “wicked” nature (Rittel & Webber, 1973). The various policy issues are constantly evolving and interdependent on each other; and there is no test for determining whether a solution is right or wrong. To deal with this, we suggest that any interventions by TRAI should be subject to constant review and reconsideration. Further, to make interventions future proof, any instrument adopted by TRAI should preferably be technology neutral.
6 Components of Net Neutrality
In this table, the different components of net neutrality are analysed in the context of the Indian telecommunications industry.
| Components of net neutrality | Experiences from International Regimes | Arguments For | Arguments Against | Recommended Framework |
|---|---|---|---|---|
| Transparency |
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| No blocking & No throttling | **Blocking:**
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**Blocking:**
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**Blocking:**
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**Block:**
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| No paid prioritisation |
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| No differential charges (Zero Rating) |
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**If charges are set low for certain apps:**
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**If charges are set low for certain apps:**
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7 Reasonable Exceptions to net neutrality
| Reasonable Exceptions to net neutrality | Experiences from International Regimes | Arguments For | Arguments Against | Recommended Framework |
|---|---|---|---|---|
| Network Management |
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| Specialised Services |
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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 summarised in para 4.29? And, what practices should be proscribed by regulatory fiat? Please comment with justifications.
India needs to develop a new regulatory framework for itself while drawing learnings from other policy regimes. Although the ETNO proposal is flawed across numerous dimensions, there are a number of learnings for the Indian regulator. The ETNO proposal attempts to give regulatory recognition to the concept of a two sided market, wherein the TEL-SP is free to negotiate commercial terms with the “remote side” (i.e. the OTT-SP) for terminating traffic on its network. In the negotiation of such commercial terms, the TEL-SP may also offer paid prioritisation to OTT-SPs that require a pre-defined quality of service. Such negotiations on the remote side (i.e. between the TEL-SP and OTT-SP) are envisioned to be free of regulatory interference and do not require regulatory approval. The process is left almost entirely to the free market.
The ETNO proposal, though proposed as a free market mechanism, substantially increases transaction costs (information, negotiation and contract costs) for doing business on the Internet. An OTT-SP would be required to negotiate terms with an average of 5 TEL-SPs in every country where it delivers its services. In addition to the transaction costs for negotiating these contracts, the OTT-SP will also be required to required to pay a fee for terminating traffic on these last mile networks. While such complications can be dealt with by large OTT-SPs, it would infeasible for small innovators and startups operating over the Internet. This is prohibitive especially in the context that the internet is projected as a disruptive technology that has substantially reduced transaction costs for doing business. Such an institutional mechanism also raises multiple public policy issues as those raised for no-throttling, no-paid prioritisation and no-differential charges, described in the preceding table.
In addition, unlike the promises made in the ETNO proposal, it is technically infeasible for TEL-SPs to promise end-to-end quality of service to an internet based service. A last mile network can not promise quality of service that will be delivered by transit networks in the internet architecture. We have alternatively proposed the concept of “specialised services” to address the need for a pre-defined quality of service that may be required by some services.
8 Recommended Framework for Intervention by TRAI
8.1 Introduction to Recommended Framework
In this section, we propose a set of principles that collectively prescribes the framework for intervention by TRAI. The framework provides guidelines for (i) introducing reasonable regulatory parity between functionally equivalent services provided by TEL-SPs and OTT-SPs; and (ii) introducing net neutrality along with details of its different components and exceptions. Both interventions are closely interrelated and should not be considered independently. In accordance with this objective, the principles are categorised into three groups. The first group is a general set of principles that apply to both interventions. The second group is a set of principles on introducing regulatory parity. The third group is a set of principles on introducing net neutrality.
The framework adopts a two-layered approach. The first layer comprises of network and infrastructure (collectively called the network layer). The second layer comprises of services and applications (collectively called the service layer). The framework further divides the second layer into “Non-IP Services”, “Specialised Services” and “Internet Based Services”. TEL-SPs operate over both the network layer and the service layer. Services such as PSTN voice calls provided over a circuit switched network are referred to as Non-IP Services. The concept of “Specialised Services” is borrowed from the European Union. Practically, the term “Specialised Services” refers to traditional services that have migrated to IP networks (that are not interconnected with the Internet) such as facilities-based VoLTE calls to PSTN and IPTV. This concept is introduced to envision reasonable regulatory parity between functionally equivalent “Non-IP Services”, “Specialised Services” and “Internet Based Services”. In the framework, “Specialised Services” is also recognised as an exception to net neutrality. A short note with various definitions and critiques of “Specialised Services” is provided in Appendix 1.
8.2 Principles Comprising Recommended Framework
8.2.1 Group 1 - General Principles
- The network layer and service layer of TEL-SPs should be delinked; or deemed to be distinct for the purpose of this consultation.
- Explanation:
- While OTT-SPs operate only in the service layer, TEL-SPs operate both in the network layer and the service layer;
- Active infrastructure (including spectrum) is a part of the network layer;
- Access to a data network and access to a voice network are a part of the network layer;
- SMS, PSTN voice calls, OTT applications, VAS services etc are a part of service layer.
- Explanation:
- Services in the service layer should be sub-classified into “non-IP services”, “specialised services” and “internet based services”.2
- Services provided over a non-IP based architecture should be classified as “Non-IP services”.
- Services provided over an IP based architecture in a closed network (i.e. not interconnected with the internet or relying on strict admission control) including facility-based services should be classified as “specialised services” (if they demonstrate the need for special treatment over and above the “best efforts” delivery guarantee possible over the Internet).
- Explanation:
- Concept of specialised services is borrowed from the European Union to refer to facility based services that have migrated to an IP architecture. Refer to different definitions of “specialised services” in Appendix 1.
- Facility based services such as PSTN VoIP calls or IPTV services provided by TEL-SPs would be a part of “specialised services”.
- Voice over LTE/IP calls terminating on the PSTN would be treated as “specialised services” since they operate over a network distinct from the internet; even if they share the same network infrastructure - it relies on strict admission control. In comparison, voice/video calls provided using internet data over LTE would be treated as “internet based services”.
- A regular Internet service must demonstrate a rational nexus between the differential treatment and its need in the form of demonstrating that “best efforts” delivery of IP packets do not suffice for the application or service.
- Explanation:
- Services provided over the internet should be classified as “internet based services”. Such classification depends on the nature of the service and not the provider of the service: “internet based services” may be provided by OTT-SPs or by TEL-SPs.
- Explanation:
- OTT applications would automatically be classified as internet based services, unless it has specifically been classified as a “specialised service”.
- Voice and video calling over the Jio Chat application released by Reliance Jio (a TEL-SP) would be classified as an internet based service.
- Explanation:
8.2.2 Group 2 - Regulatory Parity Principles
- The network layer may be regulated by way of licensing.
- Non-IP Services and Specialised services may be regulated by way of licensing.3
- Internet based services should be regulated by instruments other than licensing. Such instruments should preferably be in the form of legislations like the IT Act and its rules thereunder.
- There needs to be regulatory parity between communications oriented “internet based services” provided by OTT-SPs and TEL-SPs.
- There needs to be reasonable regulatory parity between functionally-equivalent “internet based services”, “non-IP services” and “specialised services” (refer Table in Section 7). However, the specialised nature of specialised services may require substantially different treatment, which should be determined on a regulation to regulation and a service to service basis.
- Arguments for regulatory parity between the “network layer” and “internet based services” are incorrect as the two belong to different layers.
- Regulations for “internet based services” may create sub-classifications such as communication services, market services and aggregation services, provided there is a reasonable nexus between the classification and the objective sought to be achieved by the regulation.4
- Regulations for “internet based services” need to be such that they promote innovation by small entrepreneurs and innovators while also incorporating concerns related to security, lawful interception and removal of unlawful content.
- Regulatory parity may be sought to be arrived at by decreasing the existing regulations on TEL-SPs and not merely by increasing regulation on OTT-SPs.
8.2.3 Group 3 - Net neutrality Principles
- Net neutrality should be codified5 and enforced:
- Networks should be required to deliver all internet traffic on a best effort basis without discrimination on the basis of protocol, port number, content, device, service, origin/sender or destination/receiver.
- No negative discrimination by the TEL-SPs shall be allowed in the form of throttling, or blocking or paid prioritisation subject to the contextualisation described in Section 5.
- OTTs should not be required to pay the terminating network for termination of traffic.
- Publish transparency reports in exercise of all reasonable exceptions to net neutrality.
- Internet based services should not be degraded as a result of specialised services.6
- There are certain reasonable exceptions to net neutrality including:
- Compliance with orders given by statutory bodies of law and court decisions.
- Specialised services (Alternately: net neutrality should only be enforced for internet based services)
- Reasonable network management
- Discrimination for the sake of network management is only permissible if:
- there is an intelligible differentia between the classes which are to be treated differently, and
- there is a rational nexus between the differential treatment and the aim of such differentiation, and
- the aim sought to be furthered is legitimate, and is related to the security, stability, or efficient functioning of the network, or is a technical limitation outside the control of the TEL-SP, and
- the network management practice is the least harmful manner in which to achieve the aim.
- Discrimination for the sake of network management is only permissible if:
- Measures based on direct request from the end user.
- Explanation: At user request, the TEL-SP may block porn content.
- Certain forms of positive discrimination may be allowed, subject to them meeting strict conditions such that they do amount to negative discrimination.
- These should generally not be on the basis of content- or source/destination, since that in general would have negative impact on competition, consumers, and network openness and diversity.
- The only situation in which such positive discrimination (including paid and unpaid zero-rating) may be allowed is if it does not harm competition and consumers, and care is taken to ensure it only minimally harms openness and diversity.
- Paid zero-rating or zero-rating on the basis of a deal with an OTT must be strictly regulated.7
- The only situation in which such positive discrimination (including paid and unpaid zero-rating) may be allowed is if it does not harm competition and consumers, and care is taken to ensure it only minimally harms openness and diversity.
- Other forms of zero-rating may be permitted as long as the regulator ensures it doesn’t occur alongside TEL-SPs raising the cost of general Internet data packs for consumers (by raising prices or decreasing data caps).8
- These should generally not be on the basis of content- or source/destination, since that in general would have negative impact on competition, consumers, and network openness and diversity.
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.
Question 17: If the OTT communication service players are to be licensed, should they be categorised as ASP or CSP? If so, what should be the framework? Please comment with justifications.
It is strongly urged that OTT-SPs should be regulated by instruments other than licensing. Preferably, OTT-SPs should be regulated through instruments such as the IT Act and its Rules thereunder. This is an imperative requirement for innovation on the Internet to continue to prosper. However, “communications” OTT-SPs should be encouraged to voluntarily adopt the Unified License through regulatory and economic incentives. This can possibly encouraged by introducing a trimmed down version of the Unified License with low regulatory compliance costs and zero revenue sharing. Such a voluntary license would authorise OTT-SPs to terminate calls on the PSTN. In return, the license could impose slightly higher requirements for interception than presently imposed by the Information Technology Act.
The regulations for OTT-SPs and TEL-SPs cannot be exactly the same. However, there can be reasonable parity in the regulations that govern the two. Such reasonable regulatory parity can be achieved even if TEL-SPs are regulated by licenses and OTT-SPs are regulated by instruments other than licensing.
9 Correcting Regulatory Imbalances
Question 5: Do you agree that imbalances exist in the regulatory environment in the operation of OTT players? If so, what should be the framework to address these issues?
Yes. There are regulatory imbalances between functionally equivalent services provided by OTT-SPs and TEL-SPs. We present below a table that suggests interventions to introduce reasonable regulatory parity between functionally equivalent “internet based services”, “non-IP services” and “specialised services”. However, it is recognised that the specialised nature of specialised services may require substantially different treatment, which should be determined on a regulation to regulation and a service to service basis. It also recognised that arguments for regulatory parity between the “network layer” and “internet based services” are incorrect as the two belong to different layers.
The consultation paper highlights the regulatory imbalance between “internet based services”, “non-IP services” and “specialised services”. However, the consultation paper incorrectly posits that “internet based services” provided by OTT-SPs are completely unregulated. The following table attempts to outline the different regulations for OTT-SPs and TEL-SPs. The table also attempts to delink the regulations attributable to the network and service layers of TEL-SPs. The table also identifies the areas where there is regulatory imbalance and suggests a recourse.
| Regulations | OTT-SPs (Service Layer) Internet Based Services | TEL-SPs (Service Layer) Non-IP and Specialised Services | TEL-SPs (Network Layer) | Layer to which the regulation belongs | Regulatory Imbalance? | Suggested recourse for correcting imbalance; or justification for maintaining present imbalance. |
|---|---|---|---|---|---|---|
| UCC/DND/Spam | No clear legislation on spam. Previously partially covered by Section 66A(c) of IT-Act, which has now been struck down by the Supreme Court | TRAI Regulation on 200 SMS per day.[^20] TRAI Regulation on UCC.[@traiUCC2015] | Service | Yes | Spam & UCC over OTT services need to be regulated. However, the mandate to regulate spam is that of the parliament by creating a new act or amending the IT-Act, and not that of TRAI. TRAI may however recommend to the Government to consider an amendment to such effect in the IT-Act. | |
| Privacy and Confidentiality | Section 43A of IT-Act | License Agreements (UASL,[^21] UL.[^22]) | Service | No | Section 43A is reasonably at par with clause 39.2 of the UASL. Additionally, there is a Privacy Bill presently under consideration by the Government that also addresses privacy concerns relating to OTTs. Question 7: How should the OTT players offering app services ensure security, safety and privacy of the consumer? | |
| Spectrum Allotment including Auctions and Revenue Sharing | Wireless Operating License r/w License Agreements (UASL, UL) r/w NIA | Network | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. | ||
| Interconnection of Networks | TRAI Regulations; Reference Interconnect Order (RIO); License Agreements (UASL, UL). | Network | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. | ||
| Interconnection of Services | No regulation. | TRAI Regulations; Reference Interconnect Order (RIO); License Agreements (UASL, UL). | Services | Yes | It should remain mandatory for OTT-SPs to get a Unified License for interconnecting Internet Telephony with the PSTN/PMLN. Alternatively, a trimmed down voluntary licensing arrangement could be created that allows OTT providers to interconnect with PSTN and terminate calls on the PSTN. Such a license would create slightly higher regulatory compliances for interception etc. OTT services maybe mandated to interconnect with each other if technically feasible and regulatorily desirable for a competitive marketplace. | |
| Security & Integrity of Networks | License Agreements (UL).[^23] | Network | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. | ||
| Interception & Decryption | Section 69 of IT-Act | Section 5 of Tele-Act; License Agreements (UASL, UL). | Services | Yes | While TEL-SPs are required to create infrastructure and be technically compliant with lawful interception requests, OTT-SPs are not required to be technically prepared for interception; and may not be technically capable of honouring an interception request. There is need to move towards parity here. Ideally, the burden on TEL-SPs should be substantially decreased. The other option, though infeasible in most instances, is to substantially increase interception requirements for those communication OTT-SPs that are based on server-side encryption and have achieved a minimum critical mass, wherein whether an OTT-SP has reached critical mass (on the basis of minutes of usage, data consumption or subscriber base) would be determined by TRAI. Those OTT-SPs that provide lawful interception in other countries but refuse to comply in India should be blocked. | |
| Subscriber Verification | No regulation. | License Agreements (UASL,[^24] UL.[^25]). | Services & Networks | Yes | Subscriber identity verification can effectively happen only at the network layer, given the fact that most service-layer platforms do not have the means of tying a user’s physical identity with their virtual existence. There are some OTT-SPs that bind their users to a network-layer identification like their PSTN number (e.g., WhatsApp), in which case the demand for subscriber verification gets addressed despite the lack of regulatory parity. | |
| Network Rollout Obligations | License Agreements (UASL, UL).[^26] | Network | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. | ||
| Permission to terminate voice calls on the PSTN | No. ISP license prohibits connectivity of Internet Telephony with domestic PSTN.[^27] | Yes. License Agreements (UASL, UL.[^28]). | Service | Yes | It should remain mandatory for OTT-SPs to get a Unified License for interconnecting Internet Telephony with the PSTN/PMLN. | |
| Emergency and Public Utility Services | No regulation. | License Agreements (UASL, UL).[^29] | Service | Yes | Those OTT-SPs that reach a critical mass should be mandated to provide these emergency services. For example, Skype provides emergency services in 4 countries including the United Kingdom. Similar requirements should be imposed by India as well. | |
| Quality of Service | No regulation | TRAI Regulation on Quality of Service | Service and Network | Yes | QoS delivered by OTT services is not fully in the control of the OTT-SP, unless they launch a specialised service that provides QoS guarantees. In such a case, they may be subject to appropriate regulation. | |
| Bulk Encryption Prohibition | No regulation | License Agreements (UASL,[^30] UL.[^31]). | Service | Yes | This regulation needs to be removed completely for both TEL-SPs and OTT-SPs. | |
| Domestic Routing of Network Traffic | License Agreements (UL).[^32] | Network | No | There is regulatory imbalance between UL (Access) and ISP License; However this imbalance is between two kinds of licenses and does not involve the OTT-SPs since switching happens at the network layer. | ||
| End User Regulation (Cyber Crimes) | Section 43 of IT-Act | Section 43 of IT-Act | Service | No | Section 43 deals with end user cyber crimes and therefore equally applies to end users of OTT-SPs and TEL-SPs. | |
| Blocking | Section 69A of IT-Act | License Agreements (ISP, UL),[^33] (UASL).[^34] | Service | No | There is reasonable parity. | |
| Contribution to USOF | Section 9A of the Telegraph act | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. | |||
| SACFA | License Agreements (UASL,[^35] UL.[^36]) | Network | No | There is no regulatory imbalance as the service layers of OTT-SPs and TEL-SPs are treated at par. See principle 7. |
10 Appendix 1 - Note on Specialised Services
10.1 Different definitions of Specialised Services
- BEREC (2011): “Specialised services” are electronic communications services that are provided and operated within closed electronic communications networks using the Internet Protocol. These networks rely on strict admission control and they are often optimised for specific applications based on extensive use of traffic management in order to ensure adequate service characteristics.
- BEREC (2012): Specialised services are usually designed to provide guaranteed characteristics of end-to-end connections (e.g. quality of service, availability and/or security). These characteristics are generally stated in contractual arrangements. Technically, specialised services typically rely on access restrictions and extensive use of traffic management techniques or strictly enforced capacity planning and provisioning.
- Digital Europe:9 “Specialised services” are designed for specific content, applications or services, or a combination thereof. Such services rely on traffic management or other networking techniques to ensure the desired or necessary level of network resources that determine subscriber experience (such as capacity, quality) with the aim to securing enhanced quality characteristics. They are delivered from end-to-end and are not marketed or widely used as a substitute for Internet access services.
- Dynamic Coalition on net neutrality: “Specialised services” are electronic communications services that are provided and operated within closed electronic communications networks using the Internet Protocol, but not being a part of the Internet. The expression “closed electronic communications networks” refers to networks that rely on strict admission control.
- Amendment 235: “Specialised service” means an electronic communications service optimized for specific content, applications or services, or a combination thereof, provided over logically distinct capacity, relying on strict admission control, offering functionality requiring enhanced quality from end to end, and that is not marketed or usable as a substitute for internet access service.
10.2 Conditions to the application of Specialised Services
- “Quality of service to specialised services is not secured by giving these services an explicit higher priority level than the internet based services, but rather by having adequate capacity reserved for the specialised services without this being done at the expense of Internet traffic.”
- Providers of content, applications and services and providers of electronic communications should therefore continue to be free to conclude specialised services agreements on defined levels of quality of service as long as such agreements do not impair the quality of internet access service.
- Amendment 236 states that “Providers of internet access, of electronic communications to the public and providers of content, applications and services shall be free to offer specialised services to end-users. Such services shall only be offered if the network capacity is sufficient to provide them in addition to internet access services and they are not to the detriment of the availability or quality of internet access services. Providers of internet access to end-users shall not discriminate between functionally equivalent services and applications.”
11 Appendix 2 - Comparison of International Regimes
| Feature | Netherlands | France | South Korea | Chile | Brazil | United States |
|---|---|---|---|---|---|---|
| Fixed/Mobile | Both | Both | Both | Both | Both | Fixed |
| Legal Instrument | Law | Soft Law | Law | Law | Plan | Law |
| Are OTTs licensed? | No | |||||
| Non-discrimination | No differential pricing | Non-discrimination between Internet traffic streams | No unreasonable discrimination | No discrimination | No differential pricing | No unreasonable discrimination |
| Transparency | Transparency | Yes | ||||
| Throttling | No throttling | No throttling | ||||
| Blocking | No blocking | No blocking (Blocks VoIP) | No blocking | No | No blocking | |
| Paid Prioritisation | No paid prioritisation | Ban on paid prioritisation | No paid prioritisation | |||
| Zero Rating | Not allowed | Not allowed | No ban | |||
| Measures at user request | User specific request | |||||
| UCC | Blocked at users request | |||||
| Network Management | Yes | Reasonable traffic management | Yes | |||
| Category of Specialised Services | yes (but no preferential treatment) | Yes (best-effort safeguard) | yes (best-effort safeguard) | No | ||
| Emergency Calling | No | No | No | No | No | No |
12 Appendix 3 - Actors in Net Neutrality Regime
| Actors that need to comply with net neutrality | Experiences from International Regimes | Arguments For | Arguments Against | Recommended Framework |
|---|---|---|---|---|
| Only Last-mile Networks (Not Transit Networks) | - |
|
|
|
| Premise Operators (such as coffee shops, bookstores, airlines) |
|
|
|
|
| Both Fixed and Mobile services |
|
|
|
|
References
Footnotes
Components of net neutrality may include no-throttling, no-paid prioritisation, no-blocking, no-discrimination, no charging of remote OTTs, no differential pricing etc. These are discussed in detail in a later section of this response.↩︎
Specialised Services is a construct imported from the European Union.↩︎
The current regime of a single license for the Network Layer and Specialised Services can continue.↩︎
For example, regulations relating to emergency communications have a reasonable nexus with the category “communications services”↩︎
This should be codified in the license agreement between the Central Government and Network Providers (TEL-SP).↩︎
QoS parameters that are monitored by TRAI need to be disaggregated as TEL-SPs can not guarantee end to end QoS for internet based services.↩︎
This regulation may be in terms of access to all OTTs to the marketplace, on non-discriminatory and standard terms; This regulation may be in terms of what additional content will have to be zero-rated (e.g., one level of hyperlinks from zero-rate content); This regulation may be in terms of requiring zero-rating of all of Internet content for a specific period of time, etc.↩︎
For instance: A TEL-SP may voluntarily offering special “top-up packs” for traffic to and from specific OTT services, may offer zero-rated access to the Internet in exchange for viewing of advertisements, may offer zero-rated access to the Internet at low-speeds, creating an incentive for users to pay for higher speeds; or it may voluntarily zero-rate traffic from local Internet Exchange Points or from settlement-free peering arrangements insofar as the TEL-SP incurs lower costs from such traffic. These practices need to be disclosed by TEL-SPs and need to be monitored by the regulator.↩︎
Digital Europe, “Digital Europe Position on Net Neutrality,” 2015, http://www.digitaleurope.org/DesktopModules/Bring2mind/DMX/Download.aspx?Command=Core_Download&EntryId=721&PortalId=0&TabId=353.↩︎
Reuse
Citation
@report{jainResponseTRAI2015,
author = {Jain, Rekha},
title = {Response to {TRAI} {Consultation} {Paper} on {Regulatory}
{Framework} for {Over-the-top} {(OTT)} {Services}},
date = {2015-03-27},
urldate = {2023-08-15},
url = {/policy/reports/response-to-trai-consultation-paper-on-regulatory-framework-for-over-the-top-ott-services/},
langid = {en}
}