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India’s Draft New Telecom Policy 2011: The Policy That Could Change India’s Digital Business Forever

India’s Draft New Telecom Policy 2011 makes one key recommendation that could revolutionize the digital space from a content and services perspective, without directly making any specific content references. It’s not about spectrum and network sharing , or mergers and acquisition, but a key change in the licensing regime.

The Draft NTP-2011 suggests the creation of technology neutral Unified Licenses (under the One Nation-One License) policy, that is envisaged in two separate categories – the Network Service Operator / Communication Network Service Operator (CNSO), which is licensed to maintain converged networks for delivering “various types of services e.g. Voice, Data, Video, broadcast, IPTV, VAS etc.”, very importantly, in a non-exclusive and non-discriminatory manner.

The second would be a Service Delivery Operator (SDO) / Communication Service Delivery Operator (CSDO). The Service Delivery Operator (SDO) would be licensed to deliver any/ all services e.g. tele-services (voice, data, video), internet/broadband, broadcast services, IPTV, Value Added Service and content delivery services etc.

What this means

This is a clear separation of content and carriage: This is clearly a separation of content and services from their carriage, a theme that we’ve written about before here, here and in our recommendations to TRAI on MVAS.

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While the devil will be in the details, this could mean that network service operators will become what they were always intended to be – modes of access to content and services for consumers, and content providers will be able to provision their services to customers independently of network service providers. You can say that that is already possible, and this is what the mobile VAS industry has been doing, but the way things have panned out, especially with the revenue share regime, what is being provided to customers is not in the hands of the content and service provider, but the telecom operator. The telecom operator – apart from the case of the mobile Internet – controls what is on the pipe, and that control is also used to push the revenue share regime, which rarely favors the content owner. As one content owner told MediaNama a few years ago, “it’s like a toll charge that is based on the value of goods (content) that I’m carrying, and not a uniform fee.”

It’s a closed ecosystem, and there is a fear that network neutrality on the mobile Internet might be compromised as well. For example, Chitrita Chatterjee from the IAMAI summarized Sunil Mittal’s statements as follows (embhasis is ours):

Sunil Mittal voiced his concern over the New Wave Companies (Google/Apple/Facebook etc.) that are not regulated. These companies do not pay taxes, nor do they have massive investments in infrastructure. These companies ride on the existing Telecom Network Infrastructure, and they also refuse to offer any kind of revenue share. He was also greatly concerned about the digital applications being able to by-pass the Telcos and depriving them of revenue through these streams. If this trend continues then the Telcos would have no choice but to increase call rates, which in turn would be counterproductive for the services to the rural and backward areas. He suggested there should be Regulations to ensure the Digital media does not violate the Telco’s space.

The telecom operator stand against net neutrality and the closed nature of the MVAS ecosystem is anti-consumer: The way the current regime works is that telecom operator, instead of providing consumers access to content and services, it provides content and service providers access to consumers. It’s a small but key difference – they control what is on the pipe.

A regime that separates content licenses on a converged ecosystem, we hope, will allow unrestricted access to the consumer through the converged telecom networks, and allow businesses to address a large consumer base without any significant curation – like in case of the Internet.

We hope it will allow the convergence of broadband and Internet Protocol, and IPTV, which has so far been restricted by lack of wireline connectivity and demand, and having two ministries to deal with – Department of Telecom and Ministry of I&B, will be unshackled. Mobile Virtual Network Operators are still not permitted in India, and unable to offer customized offerings for specific segments of consumers. Digital Ubiquity is the future, and our belief is that digital content and services should be made available across platforms: converged networks, a unified license and the separation of content and carriage enables that.

There are a few things that worry us:
–  Cost of license: this could be an inhibitor. The Service Delivery Operator (SDO) can offer tele-services (voice, data, video), internet/broadband, broadcast services, IPTV, Value Added Service and content delivery services. There might be a price to pay for such a broad license, which could be an inhibitor for a Startup wanting to, for example, only provision on-demand advertising supported farming tutorials to rural areas, across mobile, BWA and Cable TV Networks.
–  Cost of carriage: While the Network Service Operator is supposed to operate on a non-exclusive and non-discriminatory manner, cost of carriage on a network could well be a means of discriminating in the provisioning the service.
– Regulatory control over content:  Licensing invariably leads to the exercise of regulatory control, and this could be a means that the government could use to control the kind of content that gets delivered on networks. We’re reminded of what an industry executive said about the IT Rules…the government may be dangling the carrot, and making the industry accept the stick.

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Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



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