Transcript Policy and Regulatory Options for Over-the

Policy and Regulatory Options for Over-the-Top
Services
Presentation to the Portfolio Committee on
Telecommunications and Postal services
26 January 2016
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
POLICY REVIEW PROCESS
(4 STAGES)
FRAMING PAPER
GAZETTED
GREEN PAPER
GAZETTED
DISCUSSION
PAPER
GAZETTED
WHITE PAPER
April 2013
January 2014
November 2014
March 2016
* UNDERPINNED BY INVITATION TO
STAKEHOLDERS TO PARTICIPATE
* WHOLE OF GOVERNMENT APPROACH
Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Core approach
ICTs are a means to realise Constitutional rights, socio-economic
development and NDP goals
* Rights based approach
* Ensure equitable access to ICTs by all
* Address supply and demand
* Flexibility and certainty
Reliant on partnerships and coordination across government,
public, private and community sectors
* Whole of government approach
* multi-stakeholder approach
* Ensure sustainable development
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Objectives
Freedom of expression
Access to diverse
content, services,
applications
Facilitate ICTs for social
development to
improve quality of life
Uphold constitutional
standards and values
Universal access and
service
Enable economic
growth, employment
Promote innovation,
creativity and SA
content in all languages
on all platforms
Stimulate investment
Ensure accessibility to
all – incl persons with
disabilities
Protect privacy and a
safe communications
environment
Maximise public benefit
from public resources
Fair competition
Transparency and
accountability
Environmental
protection
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Over-the-Top Services (OTT)
• Open Internet (Net Neutrality) - OTT;
• Several submissions received on Net Neutrality/OTT during the
Green Paper and Discussion paper consultation process;
• Stakeholders raised various policy and regulatory issues
pertaining to Net Neutrality/OTT.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Definition of Over-the-Top Services
• What is OTT services: OTT refers to services provided over the
Internet rather than solely over the provider’s own managed
network.
• The user’s ISP/telco is not involved in the supply of an OTT service
• Examples of OTT Services include:
Chat applications (WhatsApp, WeChat, Facebook Messenger);
Streaming video services (Netflix, Amazon Prime, YouTube);
Voice Calling and Video chatting services (e.g. Skype, Facetime)
•OTT players which rely on IP based networks to reach their
customers do not make any direct contribution towards the cost of
providing it;
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Over-the-Top Services
• The following points about OTT services, which have been put forward by
the ITU (ICT Regulation Toolkit: Regulating ‘Over-the-Top’ services):
 Proliferation of content and applications services is to be welcomed
(add utility for users).
 Change is inevitable. As network operators migrate to next generation
networks, voice services will become software applications riding over
the network. During this transition, policy-makers are finding different
paths to balancing innovation, investment and competition.
 Regulators cannot hold back the tides of change to maintain the status
quo.
 These changes are disruptive and inconvenient for those with a stake in
existing arrangements, but the benefits of change outweigh the costs.
 Regulators generally support innovation. They prevent fixed and mobile
operators from blocking or degrading competing services.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Net Neutrality Defined
• OTT discussions: broader policy issues of Net Neutrality and
Open Internet;
• The European Parliament defines a net neutrality policy as a
set of rules that ensure Internet traffic is: “treated equally,
without discrimination, restriction or interference, independent
of the sender, receiver, type, content, device, service or
application”;
• Such a policy could also specify that no preferential treatment
should be given to any data and include requirements relating
to equal charges regardless of user, content, site, platform, or
mode of communication.
• Key Policy Issue for South Africa is: Should OTT be regulated or
Not? Should we put in a place a Net Neutrality Policy?
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
International Benchmarking on OTT
regulation
A number of jurisdictions have introduced net neutrality policies,
including Chile, USA, the European Union, Brazil and the Netherlands
etc.
Chile
•In 2010, Chile introduced net neutrality principles in its National
Telecommunications Act;
•Telecommunications Act states: “No [ISP] can block, interfere with,
discriminate, hinder, nor restrict the right of any Internet user of using,
send, receive, or offer any content, application, or legitimate service
through the Internet, as well as any activity or legitimate use conducted
through the Internet.”
•Chile further banned “zero-rating” in May 2014.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
International Benchmarking on OTT
regulation
Netherlands
•In 2011, The Netherlands became the second country globally to
introduce net neutrality principles into a law;
•The law prevents mobile operators from blocking or charging
consumers over and above the regular data charges, for using VoIP
based apps and other internet-based communication services.
•Zero-rating access deals are also outlawed in the Netherlands.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
International Benchmarking on
OTT/Net Neutrality policies
United States
•In the USA, for example, network carriers have reacted to OTT;
•When Apple’s iPhone was released, AT&T imposed a restriction on VoIP
services over its 3G network;
•However, due to pressure from users and the US regulator, the
restriction was finally lifted;
•It is understood that US providers have realised they can’t fight that
battle, and that they should content themselves with reaping the
benefits of offering good 3G and 4G connectivity for those who use OTT
services;
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
International Benchmarking on
OTT/Net Neutrality policies
United States cont..
•Some network service providers even have their own OTT service
(which is finally not really OTT, but rather an alternative to it), with
favourable rates to its customers;
•In March 2015, the FCC released new internet rules on which further
strengthens the network neutrality concept in the US. These rules,
called as bright-line rules are:
a.
No Blocking: broadband providers may not block access to legal content,
applications, services, or non-harmful devices;
b. No Throttling: broadband providers may not impair or degrade lawful internet
traffic on the basis of content, applications, services, or non-harmful devices.
c. No Paid Prioritization: broadband providers may not favour some lawful
internet traffic over other lawful
traffic in exchange for consideration of
any kind—in other words, no "fast lanes.“
(Not yet incorporated as law though)
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
International Benchmarking on
OTT/Net Neutrality policies
India
•The Telecom Regulatory Authority of India (TRAI) took a decision in
August 2014 not to regulate OTT;
•TRAI’s argument was that the mobile operators recover their losses
through increased data revenue;
•Mobile operators had claimed that the use of applications such as
Skype and WhatsApp would annually cost them over US$822 million in
lost revenue;
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Written Submissions on Net
Neutrality/OTT
• Inputs from ICT Policy Review stakeholder consultation on Net
Neutrality and OTT include:
• Stakeholders that proposed a net neutrality policy raised
concerns that if the policy framework does not enforce this,
broadband providers might act as gatekeepers of content and
use their last mile infrastructure to block internet applications,
content (websites, services, protocols) and competitors by, for
example, using deep packet inspection to discriminate between
over the top content, services or applications
• Others argued that this is a particular concern given
convergence as, for example, network providers could
themselves provide or partner with content services and limit
access by audiences to competitors.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Written Submissions on Net
Neutrality/OTT
• Others expressed concern that “access tiering” would be
introduced by broadband providers if a net neutrality policy is
not developed.
• This could result in a ’fast-lane’ for rich and powerful creators,
and a ‘slow lane’ for less powerful users”.
• Some proposed that South Africa follow the Netherlands model
for full network neutrality;
• Other stakeholders suggested that we adopt a slightly different
approach, proposing that a net neutrality policy should require
broadband providers to be transparent about their network
management policies, thus suggesting that fair traffic
management should be permitted;
• The focus is on the need for transparency of traffic management
policies and that providers should be upfront if they limited
streaming from any media source.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Written Submissions on Net
Neutrality/OTT
• Others stated that service providers should “probably be
prevented” from manipulating access to specifically harm a
competitor but should not be stopped from providing more
choice to customers.
• All these written inputs have been earnestly considered in the
process of drafting a National Integrated ICT Policy White
Paper.
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Policy and Regulatory Issues on OTT
Consumer aspects:
Protection of rights;
Internet should be free and open;
Data protection and privacy
Competition aspects:
Promote service-based competition (greater consumer choice);
Better pricing of services
To regulate or not to regulate ECS providers? Regulation of services
and/or content and not entities?
Two licenses: ECNS (regulated) and ECS (not regulated),
Implication for vertically integrated players?
What is the real issue? Stimulate innovation or stifle it?
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
What are the Regulatory Issues
pertaining to OTT/Net Neutrality
• Economic aspects: who should pay, and for what? Consumers
currently pay for: bandwidth, IP no’s and equipment's.
Cost of communications
• Technical and regulatory Issues: transparency, non-blocking,
throttling, reasonable speed, traffic management for congestion.
Where is the dividing line for traffic management? In what
instances might regulators interventions be justifiable?
• Technological aspect: embrace technological developments and
encourage more innovation
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Policy making
• Facilitate the availability, accessibility and affordability of ICT
services
• Consumer protection
• Embrace market developments and digital opportunities
• Create a competitive and enabling policy environment
• Promote investment and innovation
• Policy need balance innovation, investment and competition
• Consider the benefits of change vs. costs
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Thank you…
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Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development
Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development