Selective banning of OTTs to create regulatory uncertainty in India: Consumer groups

One of the concerns cited by the organisations, including the Consumer Unity & Trust Society (CUTS), Consumer Guidance Society and Consumer Guild, among others, is that OTT service providers are already regulated under the IT Act 2000 which will be replaced by the upcoming Digital India Act (DIA).

   

Raising their concerns over the proposed regulation by the Telecom Regulatory Authority of India (TRAI) to selectively ban OTT apps in the event of a law and order situation, at least 11 consumer groups on Monday said the proposal would lead to overregulation and would create regulatory uncertainty in the domestic market.

One of the concerns cited by the organisations, including the Consumer Unity & Trust Society (CUTS), Consumer Guidance Society and Consumer Guild, among others, is that OTT service providers are already regulated under the IT Act 2000 which will be replaced by the upcoming Digital India Act (DIA). Therefore, such consultations should form part of the Digital India Act and any other additional consultations by regulators like TRAI will also lead to an overlap of the regulatory structure.

TRAI in July started the process to examine the issue of regulating OTT communication apps.

“The proposed framework for selective banning of OTT applications and services will be a case of overregulation, and will have unintended consequences of quelling innovation,” said Amol Kulkarni and Shiksha Srivastava of CUTS.

“Such a consultation on selective banning should form a part of the consultations over the DIA. Moreover, the technicality of how the same can be undertaken remains unclear as well,” CUTS added.

The Broadband India Forum (BIF) on Monday said that OTTs are adequately regulated under the existing IT Act, 2000, and other associated acts and rules. BIF argued that existing laws, including the IT Act and the Consumer Protection Act of 2019, sufficiently address the regulatory, economic, security, privacy, safety, and consumer grievance aspects of OTT services.

Furthermore, government agencies possess the necessary powers under Sections 69, 69A, and 69B of the IT Act for lawful interception, eliminating the need for additional regulatory burdens. BIF also firmly opposes any selective banning of OTT services, confident that such measures would not pass the scrutiny of fundamental rights. While the OTTs operate at the application layer, TSPs provide network infrastructure.

“Moreover, they do not enjoy equal rights; TSPs possess unique and exclusive rights, including the right to interference-free spectrum, right of way, a unique numbering plan, and interconnection rights, which OTTs do not have,” said the BIF.

These fundamental differences lead to the conclusion that OTT services and TSP services do not belong to the same relevant market.

“OTTs have significantly enhanced accessibility to digital tools and amenities, enriching lives and empowering individuals by boosting productivity and socio-economic standing. This has resulted in massive economic spillover effects, contributing to the nation’s prosperity,” said TV Ramachandran, President of BIF.

“We hope that the regulator and the government will allow market forces to operate freely, incentivising growth and progress in this vital sector. TSPs can compete freely, and OTTs should not face restrictions in favour of TSPs,” he noted.

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