The Cellular Operators Association of India (COAI) has reiterated its demand for large over-the-top (OTT) platforms to contribute to Indian telcos network infrastructure costs. COAI argues that telecom operators like Reliance Jio, Bharti Airtel, and Vodafone Idea bear increasing financial burdens due to surging data traffic from OTT services like WhatsApp. The association estimates that telcos spent an additional Rs 10,000 crore in 2023 alone on infrastructure expansion due to Large Traffic Generators (LTGs). It also raises concerns over spam and fraudulent communications on messaging apps, calling for stricter regulations. COAI advocates that OTT platforms be governed under the Telecommunication Act, 2023, ensuring parity with telecom operators. Furthermore, the organization opposes allocating the 6GHz spectrum band to Wi-Fi services, instead urging the government to reserve it for 5G and 6G expansion. Global telecom trends highlight significant investments by telcos, reinforcing COAI’s position that OTT platforms should share network costs.
1. The Growing Dispute Between Indian Telcos and OTT Platforms
1.1 The Revenue and Business Model of Indian Telcos
Indian telcos operate on a subscription-based revenue model, primarily earning from voice calls, data packs, and enterprise solutions. The sector has witnessed significant investment to expand 4G and 5G networks, with telecom giants like Reliance Jio, Bharti Airtel, and Vodafone Idea collectively investing billions in infrastructure. However, despite increased data consumption, telcos face declining Average Revenue Per User (ARPU), creating financial stress.
1.2 The Growth and Monetization Model of OTT Platforms
OTT platforms such as WhatsApp, YouTube, and Netflix provide services over telecom networks without directly contributing to infrastructure costs. Their revenue models include subscriptions, advertisements, and premium content. With data consumption skyrocketing due to video streaming and cloud-based applications, telcos argue that OTTs benefit disproportionately without sharing network expenses.
2. COAI’s Demand for Fair Contributions from OTT Platforms
2.1 Rising Infrastructure Costs
COAI reports that Indian telcos collectively spent an additional Rs 10,000 crore in 2023 to handle increased data traffic. This rise stems from LTGs, which account for the majority of data consumption. Telcos argue that without OTT contributions, they face unsustainable capital expenditures.
2.2 Regulatory Disparity and the Need for Policy Reform
Currently, OTT platforms operate without direct telecom regulations. COAI urges the government to regulate them under the Telecommunication Act, 2023, ensuring equal rules for similar services. The principle of “same service, same rule” would create a level playing field and prevent telcos from shouldering unfair costs.
3. Rising Concerns Over Spam and Fraudulent Communications
3.1 The Threat of Spam and Fraud on Messaging Apps
Spam and fraudulent messages on platforms like WhatsApp and Signal have surged. COAI stresses that the absence of a regulatory framework enables scammers to misuse these applications, harming users and reducing trust in digital communication.
3.2 Advocating for Stricter Regulations
COAI proposes stricter policies to curb spam and fraud, emphasizing that OTT messaging services should adhere to telecom-like regulations to ensure consumer protection and data security.
4. The Global Perspective: Telecom Industry Trends
4.1 GSMA Report on Global Telecom Investments
Ahead of MWC25, a GSMA report revealed that telecom operators globally have invested over USD 109 billion annually in mobile infrastructure. It highlights that 85% of mobile internet infrastructure funding comes from telecom carriers, reinforcing COAI’s argument for OTT contributions.
4.2 The Global Impact of Unregulated OTT Platforms
Kochhar, COAI’s director-general, pointed out that 11 global telecom companies have shut down due to financial unsustainability. Without regulatory intervention, telcos may struggle to maintain profitability and network expansion.
5. Spectrum Allocation Dispute: The 6GHz Debate
5.1 COAI’s Opposition to 6GHz Band Allocation for Wi-Fi
COAI insists that the 6GHz band should be reserved for 5G and 6G deployments rather than Wi-Fi services. It suggests Wi-Fi 7 as an alternative for broadband expansion without spectrum reliance.
5.2 Government’s Role in Spectrum Management
COAI urges policymakers to prioritize telecom operators’ needs, ensuring that essential spectrum resources support India’s long-term digital infrastructure growth.
6. Learning for Startups and Entrepreneurs
- Understanding Regulatory Changes: Startups in the digital space should stay updated on telecom regulations, as potential policy shifts could impact service costs and business models.
- Infrastructure and Fair Usage: Tech entrepreneurs should acknowledge the role of telecom networks and explore fair partnerships with network providers.
- Cybersecurity and Consumer Protection: Rising concerns over spam and fraud highlight the importance of security measures in digital businesses.
- Global Market Trends: Observing international telecom failures can offer valuable insights for startups aiming for long-term sustainability.
- Spectrum Management: Startups in wireless technology should evaluate spectrum availability and plan accordingly to align with future telecom trends.
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