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Johannesburg - Over-the-top (OTT) internet apps such as WhatsApp are under the spotlight in South Africa after Parliament this week held a meeting into regulating such services.
Parliament heard debates for and against regulation against OTTs this week.
READ: Mobile networks fear becoming 'dumb pipes'
Meanwhile, debate hasn’t only been raging in the corridors of Parliament but also in the public space.
Earlier this week, a Fin24 user wrote a letter questioning whether OTTs really are the future for the telecoms landscape.
“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,” wrote Viv.
“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,” said Viv.
However, another Fin24 user, ‘Kwaaikat’, has responded to Viv’s farmer analogy. And Below is Kwaaikat’s response:
“This is a response to an opinion posted by Viv defending the stance of the big mobile operators, and questioning whether OTT's such as WhatsApp really are the future.
The analogy of two farmers, and the second one getting a free ride and selling the first farmers' produce, which Viv uses, is not correct. Unlike the ‘farmer A’, the operator already gets a huge amount of revenue from OTT. Nobody forces them to sell data, and nobody forces them to sell at it at a certain price. In the real story, townspeople do pay, it is ‘farmer B's’ produce that farmer B sells (which is cheaper and better than the part of Farmer A's produce with which it competes), and farmer B does pay for the transport. The more farmer B sells, the more he needs transporting, so Farmer A is already getting a handsome sum from that.
Unlike ‘Farmer B’, the consumer already pays for the data. This is more like ‘Farmer A’ not being happy with the paid lift arrangement (which Farmer A can stop offering if he wants) and he now sticks his nose into what the lift is worth to Farmer B. It turns out Farmer B is using the paid lift arrangement to bring a new better beans to the market.
‘Ahh’, says Farmer A, ‘I could stop offering him a lift, but then he would just use another farmer, or other transport means (ADSL with Wifi), and I would lose that (very handsome, as per my last results) lift revenue (data). I could raise the price to get a bigger share of the party, but then he would go elsewhere. All of us farmers with carts can agree to charge Farmer B more if he takes those special beans, but that would be price fixing, and if one of us betrays the agreement, the rest of us would lose a lot of our transport business. So let’s lobby the mayor (ICASA) to make it a law that when guys like Farmer B take new beans to the market, we should charge a lot more for the trip. Then his new inexpensive WA (editor’s note: WhatsApp?) beans that everybody so loves would lose their edge over our expensive inferior ones (SMS beans). It would hurt the people buying at the market, and people would be jealous of other towns where the people still pay a lot less for better beans, but maybe our mayor will fall for it.".A few people at the market stand up saying that ‘It should be up to everyone to have choice. Besides, the cart pulling farmers will survive without selling the SMS beans, as they sell lots of other stuff AND they profit from the WA beans anyway with their lucrative transport (data) businesses. The people in other towns have been eating the fast growing cheaper better WA beans for months now and never looked back. Why should we be made to pay to help the declining SMS beans business?’In this town, a lot of the lower middle class of this town, beans is a major expenditure item. What will Mrs Mayor ICASA decide? May she be wise and look at the future.Kwaaikat"
