Trai chairman R.S. Sharma (Photo: Ramesh Pathania/Mint)
Trai chairman R.S. Sharma (Photo: Ramesh Pathania/Mint)

Netflix, Hotstar, Amazon Prime Video might soon be regulated by TRAI

  • Trai cites threat to national security, data privacy concerns to make the case for a regulatory framework
  • Trai said video streaming services may be brought under the purview at some point in the future

NEW DELHI : The Telecom Regulatory Authority of India (Trai) is looking at the possibility of bringing over-the-top (OTT) digital communication services that provide same or similar services as telecom service providers (TSPs) under the same licensing or regulatory norms that are applicable to the latter.

This comes against the background of critics continuing to bat for the freedom of the Internet and the unique nature of OTT services such as digital media, including WhatsApp, Facebook, Twitter, Hike and others that perform the same functions of voice and messaging as telcos.

The most important argument, during an open house discussion held on Monday on the regulatory framework for OTT communication services, was the threat to national security and data privacy. Information, often false, sent on these social media platforms, especially during national or natural emergencies is a huge threat to the country and a prime example of the misuse and exploitation of these services.

“Communication services is a broad term and can include both real time and non-real time services such as email or Internet websites to govern which the IT Act is already there. We are, however, restricting our scope to those OTT services whose function is similar to those TSPs that have a licence," said Trai chairman R.S. Sharma. The regulatory imbalance between TSPs and OTT services formed the central question of the discussion and the regulatory body would come out with a set of regulations or recommendations within a month, said Sharma.

There is currently no pre-remedy to prevent the proliferation of such content in India or an official body to report grievances to, said Satyam Singh Rajput, founder of an NGO called Justice for Rights Foundation (JRF) that had filed a petition in the Supreme Court seeking regulation of content on these platforms that is often explicit and offensive.

Trai said that video streaming services such as Netflix, Amazon Prime Video, and Hotstar may be brought under the purview at some point in the future but were currently exempt from the discussion. Earlier this year, nine OTT video-on-demand services including Hotstar, Voot, ZEE5, Arre, SonyLIV, ALT Balaji, Reliance Jio, Netflix and Eros Now decided to adopt a self-regulatory Code of Best Practices under the aegis of the Internet and Mobile Association of India (IAMAI).

Further, telecom operators fully support the regulation of OTT services in view of their own interests.

“TSPs pay multiple levies including regulatory levies, duties and taxes while OTT communications service providers are not subject to any of these regulatory costs or taxes. This limits the way TSPs can do business and earn revenues while at the same time adding expenses in the form of compulsory compliances," said the Cellular Operators Association of India.

Of late, the data demand in the country has increased manifold because of the surge in popularity of video-content-based OTTs on mobile devices. The revenue earned by the operators needs to grow or the taxes and levies need to be reduced to meet the investments required for the country’s telecom networks, it said. One way of achieving a level-playing field for both is to review the existing licensing and regulatory provisions applicable on TSPs and subjecting OTT communications services to this.

Contesting these are the supporters of Internet freedom. Moreover, the government of India’s expert committee on data protection chaired by Justice Srikrishna has acknowledged that current legal provisions and practices on surveillance, including the absence of any judicial oversight, fail to adequately protect the fundamental right to privacy.

Even if a law on data protection comes into place, there is no active government proposal to either bring surveillance reform within its ambit or to regulate intelligence and policing agencies, the Internet Freedom Foundation pointed out.

“This is illustrative of the reductiveness of a debate that commences from dulling the feature richness and diversity of Internet applications and services into the straitjacket of OTT. The dangers of avoiding bright lines of regulation and the uncertainty in treatment may prevent free expression which forms the very basis for innovative thought and action. There are also concerns that overbearing and costly legal compliances and product decisions may harm India’s vibrant start-up ecosystem," it said.

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