Telecom Giants Vodacom and MTN Propose Paid Services for Netflix and WhatsApp - and the Potential Downsides Explored
Mobile Network Operators (MNOs) in South Africa, primarily Vodacom and MTN, are advocating for Over-The-Top (OTT) services like Netflix and WhatsApp to pay for using their networks, sparking heated debate over fairness and potential consequences.
The shift in perspectives comes from MNOs contending that OTT platforms enjoy the benefit of their network infrastructure without contributing to its cost. According to the operators, their responsibilities include laying fiber, installing 4G/5G towers, and maintaining the equipment, while OTTs continue to stream high-definition content without contributing financially.
There is a valid argument for infrastructure investment costs, as the ever-increasing data traffic from OTT apps places significant demand on network resources. However, the notion of OTTs paying their 'fair share' remains a contentious issue, with several potential drawbacks that warrant careful examination.
First, double-dipping is a concern. Users are already paying for data, and charging OTTs for the same data could create an unnecessary additional burden. This issue is often likened to a concert-goer being charged by the band for using the stage, as the same data is at play in both instances.
Net neutrality is another significant factor. By imposing charges on OTTs, there is a risk of selective throttling or even blocking of services that have not paid the required fees. The impact on economy-tinged services like WhatsApp in countries like Zimbabwe is of particular concern, as a potential shutdown could have devastating effects.
The inclusion of startups in the proposed charger is also a worry. Given their limited resources, it is unlikely that emerging OTT players could afford the necessary fees to maintain operations, potentially stifling innovation and competition in the digital space.
It is crucial to remember that MNOs benefit significantly from their relationship with OTT platforms. In spite of the reported imbalance, it is worth acknowledging that these digital services drive data usage, ultimately benefiting MNOs financially. Indeed, many MNOs actively promote OTT usage as a means to boost data revenue.
Tiered contributions and infrastructure partnerships are being explored as potential solutions, but these solutions may not be feasible for smaller economies like South Africa and Zimbabwe. A delicate balance must be struck to avoid compromising a fair and competitive digital landscape while ensuring the long-term sustainability of MNOs and their network expansion efforts.
The guiding principle ought to be maintaining affordable, open internet access without creating insurmountable barriers for startups and smaller players. Ultimately, consumers simply want to enjoy their digital experiences without facing prohibitive costs.
Data centres play a crucial role in facilitating the delivery of content by OTT platforms, as they rely on the infrastructure provided by mobile operators. However, the finance minister of South Africa and relevant regulators need to consider the technology challenges and potential consequences before implementing decisions that may require OTT platforms to contribute financially towards the maintenance and expansion of mobile networks.
