I just read a 24-page report, on the NCC (Nigeria Communications Commission) website. It’s titled, “An Overview Of Provision Of Over-The-Top [OTT] Services”. In case you’re wondering, Over-The-Top services are any internet services that are carried over telco networks, to deliver value to the end user without the service providers getting any profit. That is, asides from regular data charges. Basically, almost everything you do on the internet today. Whatsapp calls, Skype, IM, Social media, etc.
It’s no secret that traditional, peer-to-peer communication mediums like SMS and phone calls, are quickly giving way to more…modern communication paradigms, like Twitter, Whatsapp, Telegram, Facebook, and Skype. They are cheaper for the end user, by many orders of magnitude, and come packed with many more features than boring, old SMS.
And of course, because they aren’t making as much of a killing as they used to, from end users, telcos have said that “there’s no incentive to continue to upgrade or maintain the networks”.
Whatever that means.
“Many traditional telecom service providers are of the opinion that traditional telephony and SMS revenues are under threat from newer, IP based alternatives like WhatsApp, Skype, Viber etc” the report said, “Similarly, third party web content and social networking companies such as Google and Facebook are increasingly generating huge revenues and driving high levels of data traffic which ride on the broadband networks of traditional telecom operators’.”
“Most traditional telephone network service providers therefore argue that unless there is a revenue flow to them from such services, they do not have an incentive to continue to maintain or upgrade the networks.”
LOL. If you like, don’t maintain it.
Oh, and it’s not a Nigerian – or African – problem. After extensive lobbying late last year, Brazilian telcos finally got a Judge to shut down WhatsApp for almost 100 million users, and their congress have been contemplating taking down the entire social web, as we know it.
It’s all too easy to see why telcos around the world are losing their shit. OTT services have long overtaken traditional mediums in their key metrics, while expending only a fraction of the maintenance cost.
Mobile operators spend $1/4tr a year on capex
WhatsApp sends 2.5x more messages than SMS, w/ 57 engineers
Unfair – but very, very relevant
— Benedict Evans (@BenedictEvans) February 2, 2016
It’s funny. In response, they also went as far as considering asking services like Facebook and Google to pay for access to the consumers who use their network resources. Basically, just take Net Neutrality, and toss it out the window.
“Should the OTT players pay for use of the MNOs network over and above data charges paid by consumers? If yes, what pricing options can be adopted? Could such options include prices based on bandwidth consumption? Can prices be used as a means of product/service differentiation?”
Good luck with that.
It’s not the first time a traditional industry is fighting back, to keep us in the past, when an entirely new platform comes to “spoil market” for them. Uber comes to mind.
The thing is, disruption will happen whether anyone likes it or not, and I think the onus is on telecom companies, to adapt to an ever changing landscape, and not try to keep us in the ice age, to protect their precious profits.
In all this, I’m not sure whether regulatory bodies, like the NCC exist to protect telco interests against the masses’, or vice versa. You have the facts. I’ll let you draw your conclusions.