A Premium Times report says the Nigerian Communications Commission (NCC) is considering a framework or policy to put simply to enable it come up with ways to regulate what it calls over-the-top services. In other words, the NCC is thinking of ways i can step into the regulation of services such as Skype, WhatsApp, Facebook, Twitter and the likes. So basically they (NCC) believe that since the millions of users in Nigerian leverage on data services from telecom operators that they already regulate, they may be able to regulate services that depend on apps and services that depend on data from them. Well this means services like Voice over Internet Protocol (VoIP) will eventually come under scrutiny or some form of regulation as well. In a report titled ‘An Overview of Provision of Over The Top [OTT] Services’ published recently by the Policy, Competition & Economic Analysis Department of the Nigerian Communications Commission, says OTT services were becoming a threat to the traditional telephone network operators.
To clearly understand their concerns which I believe is now global as well, services like VoIP, WhatsApp, Facebook Messenger all offer alternatives to text messages and traditional voice telephoning. This means potential loss in revenue to agencies like the NCC as networks see a decline in revenue.
But How Much Can The NCC Do About This?
You need to visit the Premium Times website and see the comments from Nigerian already who disapprove of this in high numbers. It is practically impossible to do this without also affecting revenue negatively as well because what it means is that, if you place some form of regulations on global services, it means more and more Nigerian won’t see the need to buy data in the first place as majority of the population have now subscribed fully to these OTT services or what you can simply call value added services (VAS).
Prof. Umar Danbatta (Executive Vice Chairman/CEO NCC)
There is a thin line between regulations and censoring and this could very well be the result here and this won’t be good for a big telecom market like Nigeria. From various researches online, Nigerian companies still rake in mega revenue as more people subscribed to data services. At a time when countries are thinking of migrating and accommodating more people on the coming 5G network, there’s no Nigerian telecom operator that offers even 4G in commercial capacity just yet and this should be the focus here even though MTN offers this service in its native South Africa. Etisalat which is considered fourth among the major operators by subscribers reported revenue in billions of dollars and this would give you a picture of MTN’s revenue at a subscriber capacity at least three times Etisalat. The point here is that they are not doing badly in spite of infrastructure challenges they still face.
VoIP and other app based services like WhatsApp are free internet based services and are protected internationally by patents in some cases and other frameworks that allow them leverage on networks across the world. They don’t interfere with frequencies therefore regulations by governments across the world is limited.
See more on our 5G report here.
Networks Should Compete With These Services In Other Ways
Major operators should come up with ways they can wither compete or manage to improve on data services on which these apps depend. Airtel for example has a service similar to Spotify or Cloud 9 in Nigeria it calls Wynk, MTN and Glo have all got services that are in direct competition with smaller players in Nigeria. The most recent example is in Uganda where MTN is appealing a $660,000/131m Naira/67m KES fine by a Ugandan court for “sabotaging” a mobile business. So the question again to NCC is this; who protects smaller businesses from the likes of MTN?
If data is the future, why not star looking at expanding capacities in High speed networks instead? Just a thought
There are ideas around voice based Valued Added Services (VAS) like Interactive Voice Response (IVR) services that can leverage on telecom capacities to thrive. There are enhanced location services that will be more accurate if done by Telecom companies. Companies like Uber among others can leverage on such partnerships in the future. This should be an opportunity to increase revenue in other areas and not one to make decisions that don’t conform with international best practices.
I guess at this point we’ll just have to wait for the “framework” before we can make more comments on the subject.