Why should OTTs pay fees to telcos?
'Netflex Your OTT Muscles', by V Sridhar, Rohit Prasad and Mansi Kedia. In the piece, the authors argued that OTTs that are large traffic generators (LTGs) should pay a fee to telecom companies for the capex investment they make to support the traffic generated by OTT video services.
The arguments to justify this, unfortunately, included various alternative facts and some misplaced theories, and are flawed for several reasons.
Customers are paying telcos data charges for watching OTT platforms.
Isn't the value of the telecom service linked to the demand for OTT apps, and if these are taken off, would customers stick to a particular network?
OTTs are being told that the fee is a fair share of the capex investment in the network.
Were OTTs consulted and involved in the selection of the equipment and the negotiation of the prices thereof? Wouldn't fairness and natural justice have demanded such involvement?
It is also being stated that 5G has entailed huge investments, and OTTs must pay their fair share. But did telecom companies consult OTTs and take their consent before participating in the 5G auction and committing huge sums for procuring the 5G spectrum? Is it fair to ask an entity to contribute to a cost where they had no say?
Don't telecom companies enjoy tariff forbearance by Trai, and, hence, operators are free to charge customers appropriate data tariffs to cover their costs? So, isn't asking LTGs to pay for infrastructure development double-dipping?
The August 14 article relies on the lone example of South Korea to justify paying a network fee.
