TATT considers OTT… again

Mark Lyndersay writes a weekly column for the Newsday.

In mid-November, the Telecommunications Authority held another consultation on over-the-top (OTT) services, the technologies that ride on an open internet and provide value for the digital channels that users pay for.

Among service providers operating locally, Digicel has been the most vocal in articulating a position that such services, particularly those which compete with the core telecommunications package, should pay a fee for their use of the bandwidth and infrastructure built out by providers.

At the core of these discussions is the issue of net neutrality, which has been overturned in the US by the FCC, prompting cheers over at Digicel (http://ow.ly/pZUZ30gO4OJ).

The TATT discussion was convened under Chatham House rules by CTO secretary general Shola Taylor.

The conversations were managed across a range of topics, specifically the issues of licensing obligations, quality of service, taxes and jurisdiction, data protection and privacy, net neutrality, infrastructure investment, local content, emergency services and the provision of a universal service fund.

Such divisions are a chimera. All of these issues emerge from the core principle of net neutrality, which pits the providers of the internet’s hardware against the developers of its software and services.

Simon Fraser, representing the TT Computer Society, was livid at the tone of the conversations, which dominantly favoured provisions that fly in the face of net neutrality. Fraser shared his speaking notes with me after the event.

He argues that in these discussions at the highest levels, there is no decisive statement of what constitutes an OTT service and the description has shifted from phone-call replacements like Viber and Skype to include services like Facebook, Uber and Google.

Fraser worries that the scope will eventually encompass all services carried over the internet and the chilling effect that will have on development and innovation.

“When a bunch of undergraduates can download a code base from GITHUB,” he said, “spend a few hundred hours and launch what is basically a global telecommunication company from their dorm room, the status quo is disrupted.

“Balanced against these losses we must not forget the incalculable – and in my opinion far more significant – benefits. YouTube has more educational material than the top 1,000 universities.

“Zero rating allows incumbents to privilege themselves and large partners. Let’s say that we allowed zero rating in 2003.

“Microsoft could afford to pay for zero rating. If this happened would we still be using MSN Messenger? Failure to support net neutrality can kill future innovations that we can’t yet imagine.”

Dr John Prince, CEO of TATT, gave opening remarks, but did not speak during the discussions.

In his speech, he offered a window into his thinking on the matters to be debated.

“We can’t stop them by regulation, so [internet service] providers must respond by competing with the popular OTT providers,” Prince said.

“Clearly, OTT services are of great value to a wide cross-section of the community. We cannot get involved in activities like blocking OTT. Block what? I am hoping that we will get assistance from the learned members of the CTO.”

There is need for rebalancing of pricing to meet revenue expectations and to pay for the cost of infrastructure maintenance and updates.

TATT estimates the loss of revenue to OTT voice services between 2009 and 2020 to be as much as 90 per cent.

Fraser argues that while voice revenue is dying, data consumption is growing exponentially.

“Telecoms providers have mispriced their fast growing service with all-you-can-eat pricing,” he notes.

“This causes a mismatch between revenue and capital expenditure that must be addressed.”

An expanded version of this column is at technewstt.com. Mark Lyndersay is the editor of TechNewsTT.com