Telecom Giants Jio, Airtel, and Vodafone Want OTT Firms like Amazon, Netflix to Share 5G Infrastructure Costs
Once again, major Indian telecom providers like Reliance Jio, Airtel, and Vodafone-Idea are locking horns with OTT (over-the-top) platforms such as Amazon and Netflix. The core of the dispute revolves around creating and financing India’s upcoming 5G infrastructure.
According to a recent report, telecom firms, spearheaded by Reliance Jio, have approached the Telecom Regulatory Authority of India (TRAI) with a proposition.
Reliance Jio, led by Mukesh Ambani, urges the regulator to mandate significant OTT players, especially those responsible for generating the bulk of data traffic, to share in the network costs. Currently, these costs fall squarely on the shoulders of the telecom providers.
Jio, with its submission to TRAI, emphasized the bandwidth consumption by OTT platforms – spanning communication, streaming, gaming, and social media, and how it strains the network infrastructure established and maintained by telecom companies.
Jio highlighted that while OTT platforms benefit considerably from the infrastructure, they don’t contribute financially to its development. As such, Jio believes it’s only fair that OTTs contribute to these costs, potentially through direct payments to telecom service providers (TSPs).
The proposed contribution structure could be based on traffic volume, turnover threshold, and user count and be mutually agreed upon by OTTs and TSPs.
Airtel added its voice to the debate, pointing out that 5G infrastructure would require 3-to-5 times more sites and fiberization. With the advent of 5G and the expected surge in data-hungry apps and services, Airtel emphasized the need for a strategy to distribute the financial burden of building this digital infrastructure among all stakeholders.
This tussle between telecom providers and OTT platforms is common in India. Telecom companies in the US and Europe have been lobbying their respective regulatory bodies to ensure tech giants like Google, Amazon, and Microsoft contribute to the 5G infrastructure development.
In response, big tech and OTT players, including Microsoft, Google, Facebook, and others, have rebuffed these demands. The Broadband India Forum (BIF), representing major OTTs and tech companies like Netflix, Amazon, Google, Microsoft, and Facebook-owner Meta, argues that telecoms enjoy exclusive benefits, such as interference-free spectrum, which provide them with competitive advantages.
They believe that equating the responsibilities of telecoms and OTTs is unjust and goes against the principles of equality, as outlined in Article 14 of the Indian Constitution. Moreover, they contend that they are already regulated under the IT Act, and additional regulations would hamper innovation.
Incorporating these insights, it’s evident that the debate over the financing of 5G infrastructure is complex and multi-faceted, with significant implications for the future of digital communication in India and beyond.
Ragul Thangavel
With over nine years of diverse professional experience, Ragul has made significant contributions across various domains, including Media Operations, OTT Technologies, Video Production, Ecommerce, and Social Media.
Holding an Engineering degree, Ragul's career took an unconventional turn when he discovered his passion for writing, leading him to begin his journey as a content writer.
His career has been exclusively dedicated to the growth and development of startups, where he has played a pivotal role. His unique blend of technical knowledge and creative prowess has enabled him to drive innovation and success in every venture he has been a part of.