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SAMENA Telecommunications Council welcomes the opportunity to respond to ITU’s Public Consultation on Public Policy Considerations for OTTs.
Global OTTs have clearly brought and are continuing to bring benefits to the digital ecosystem and the economy. They also raise important questions in relation to their compatibility with current national regulatory and economic frameworks. These incompatibilities have created an uneven playing field and local market distortions (local profit and value shifting and base erosion), have exposed significant gaps in relation to national privacy and security policy and have highlighted the need for a coordinated cross-border approach to data movement and data protection.
The key concern raised by network operators is one of competition between partners within the same ecosystem on an uneven playing field. This is negatively impacting operators’ incentives to invest and operators’ revenues, with some sources suggesting OTTs are responsible for a loss of around 12% of mobile operator revenues in 2017. If national legacy regulatory frameworks that typically do not apply to OTTs persist, they could increase an uneven playing field in a 5G environment. This risks not fostering the balanced convergence of OTTs and network operators. It is therefore essential that policies and regulations consider the increasing convergence between telecom and OTT services, i.e. the substitution between telecom and OTT services on the demand-side, and the blurring boundaries between telecom and OTT services in a 5G / cloud environment on the supply-side.
Policies need to be reviewed with a forward-looking perspective, rather than playing catch-up with technology innovation which would deter the development of, and investment in 5G. A situation should be prevented where OTTs are the sole innovators going forward, not only in services but also in network technologies (e.g. network virtualization, which allows networks to be hosted on standard IT server equipment and thereby enables the separation of hardware from the intelligence). National governments and regulators are therefore urged to define new clear forward-looking policies and regulatory frameworks that support innovation, investment, competition, new business models and local value creation. These new policies and frameworks must establish a level playing field based on the principle of “same service same rules” to aid balanced transition. New regulations should be light-touch, outdated regulations should be removed, and key principles should be transferred to the entire digital ecosystem, including principles of pluralism, proportionality, openness, non-discrimination, neutrality, public interest, standardization, security and consumer protection.
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