What the DoT panel on net neutrality has to say on the future of VoIP services in India

With the aim to make the Internet free and fair in India, the Department of Telecom panel has released its recommendations about net neutrality in India. Among other issues concerning net neutrality, the panel at length has given recommendations as to how the over-the-top (OTT) services such as WhatsApp, Viber, Skype should be regulated so as to create a level playing field between telecom service providers (TSPs) and OTT providers. Excerpts from the Committee Report:

1. OTT application services have been traditionally available in the market for some time and such services enhance consumer welfare and increase productivity. Therefore, such services should be actively encouraged and any impediments in expansion and growth of OTT application services should be removed.

2. Specific OTT communication services dealing with messaging should not be interfered with through regulatory instruments.

3. In case of VoIP OTT communication services, there exists a regulatory arbitrage wherein such services also bypass the existing licensing and regulatory regime creating a non-level playing field between TSPs and OTT providers both competing for the same service provision. Public policy response requires that regulatory arbitrage does not dictate winners and losers in a competitive market for service provision.

4. The existence of a pricing arbitrage in VoIP OTT communication services requires a graduated and calibrated public policy response. In case of OTT VoIP international calling services, a liberal approach may be adopted. However, in case of domestic calls (local and national), communication services by TSPs and OTT communication services may be treated similarly from a regulatory angle for the present. The nature of regulatory similarity, the calibration of regulatory response and its phasing can be appropriately determined after public consultations and TRAI’s recommendations to this effect.

5. For OTT application services, there is no case for prescribing regulatory oversight similar to conventional communication services.

TSPs in the past have explored new opportunities to generate revenues from users and the content providers. Some of the models attempted by TSPs, such as charging higher data tariffs for VoIP services, charging content application providers and providing the content free to users (called "zero rating" plans), have raised concerns about net neutrality.