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WhatsApp, Hike, and Skype could be forced to pay up in India

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Telecom companies in India are in a time warp. They want the Telecom Regulatory of India (TRAI) to bring back the revenue they’re losing out as smartphone users shift en masse to free messaging and calling apps.

“They [telecom service providers] wanted discussion on treatment of OTT (over-the-top) services like WhatsApp, Skype, and others which are actually cutting in to their revenue,” TRAI Secretary Sudhir Gupta said at a seminar this week in New Delhi, reports PTI.

OTT refers to text, audio or video sent over the internet. Since users access these through data plans, they work out much cheaper than sending an SMS or making a phone call. Telecom operators are seeing a spike in data usage, but this comes nowhere near compensating for fewer calls and SMSes. So they want the TRAI to approve a so-called ‘connectivity charge’ for free messaging and other such apps.

For the TRAI to go along with this, it would have to buck a technology trend in which more and more services are moving to the internet. It is difficult even to define what exactly constitutes an OTT. This week Tech in Asia reported how a new, hybrid WAN (wide area network) uses a combination of leased telecom lines and the internet to lower networking costs for large enterprises. To work out how much of this service is OTT will be tricky to say the least.

The other issue is that a multitude of apps piggyback on internet services provided by telecom operators. Will they all have to pay ‘connectivity charges’ in addition to the data usage charges their users pay the telcos? And will the providers of these apps absorb these new charges or pass them on to consumers? In other words, will the millions of users who have come to depend on free apps now have to pay up for them?

The irony is that consumers already have the short end of the stick in their dealings with telecom operators in India. For example, WiFi and 4G services are notorious for luring consumers with attractive Mbps speeds, then providing much slower downloads most of the time because the wireless service providers don’t have the spectrum or bandwidth to serve the number of users they take on board.

This week the Telecom Regulatory Authority of India directed the operators to specify the ‘minimum download speed’ in all its communication to consumers, instead of just tom-toming speeds in ideal conditions. And TRAI wants that minimum download speed to be maintained 80 percent of the usage time. This will be a relief to many who are frustrated by slow speeds after paying up for superfast WiFi or 4G.

Consumers of free messaging apps in India — 50 million of them on WhatsApp and 20 million on Hike at last count — will be hoping that TRAI takes a pro-consumer stand on the telcos’ push for connectivity charges too. The Internet and Mobile Association of India has in fact said TRAI shouldn’t get involved at all. It should be treated as a matter to be sorted out between the telecom operators and OTT service providers.

See: Investors still bet on local chat apps like Hike

(Top image: Flickr user Alvaro Ibanez)

Editing by Terence Lee

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