Fin24 user: Are OTTs really the future?

2016-01-27 15:38
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Johannesburg - Regulating over-the-top internet services such as WhatsApp and Skype has come under the spotlight in South Africa this month.

On Tuesday, Parliament held a meeting to discuss possible regulatory issues around OTT in South Africa.

The meeting came after MTN and Vodacom last year made calls for regulators to pay attention to OTTs which allegedly don’t contribute financially to mobile network infrastructure in South Africa.

But on Tuesday, tech giants Facebook, Microsoft and Google expressed their opposition to OTT regulation. Other analysts also voiced their concerns.

READ: Tech giants reject OTT regulation for SA

But Fin24 user Viv has come out in support of mobile networks’ criticism of OTT in South Africa. Read Viv's letter to the editor here. Also, tell us your view on Viv's letter by clicking here:

How can mobile companies innovate when the money they require to do so is eaten up by current OTTs? It is easy for most of us to stand on the sidelines and criticise, but in fact the harsh reality is, some of these mobile companies are selling insurance, yes insurance, which is odd if you consider that our mobile companies are ‘filthy rich’. Another one is selling streaming movies and so on.

Think about this: Farmer A and Farmer B goes to the market and sell their produce. Farmer A pays the municipality for the road used, while Farmer B, rides on the lorry of Farmer A (along with his produce) and pays nothing. The problem is, Farmer A sells Produce A while Farmer B gives Produce A away for FREE ... Farmer A cannot get rid of Farmer B or ask Farmer B to pay for the road used in fear of a backlash from customers so what can Farmer A do? No, Farmer A cannot sell Produce A for FREE.

In reality, working with OTT companies comes at the risk of violating net neutrality and raises the barrier of entry for other competing OTT services that could be more innovative. For example, Cell C is offering a R5 WhatsApp model, so if another similar service that is more innovative than WhatsApp is launched, would this not affect them? It would be fair for mobile operators to offer R5 for ALL similar services, but is this possible? How do new services work with operators so they are not prejudiced?

I think when a messaging app starts to behave like a telephonic company and affects the revenue of a mobile operator to unify cheaper communication through data calls via Wi-Fi or LTE, I would stand of the side of the operator on this one. It will have its longer term benefits. Video and voice calls will be of higher quality and could be offered at a much cheaper price if the invested technology is there and many people are using it. I will not stand at the side of operator if they plan to regulate the messaging side of any OTT app because it would be a tedious thing to do. This means, they will have to also regulate e-mail apps, gaming apps that offer chats during plays and so on which is not easy to classify.

Right now, it is understandable for most people to think OTT is the future, but is it really? If I want to make a telephone call right now via OTT, what are the chances of me getting through to another different OTT? How many of us have more than one OTT app installed just to call or keep in touch with various people? What is the price of making an OTT call locally in SA? Each OTT app wants to have their dominance so what does that leave the operator that carries their load?  It is a difficult question to answer like the question: Which one comes first, the chicken or the egg?

Viv.

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