Regulating OTT Services in the Caribbean

By Cathrona Samuel

Over the top (OTT) services are fast becoming the medium of choice for communication and entertainment across the Caribbean. Simply put, an OTT application is any app or service that provides a product over the Internet and bypasses traditional distribution. Chat services such as Whatsapp and Facebook Messenger, for example, have been replacing traditional voice and SMS services. FaceTime and Skype are being more heavily relied on for long-
distance communication.

Although we have not seen a mass migration away from traditional cable services to on-demand television, services such as Netflix are increasing in popularity across the region. From a commercial standpoint OTT services have reduced the cost of doing business through the use of real-time communication and file transfer systems.[1]

Increased reliance on OTT services however, cannot be viewed only in the context of their demand, it has also created an avenue through which content can be produced and distributed in the region. 2015 saw the introduction of Caribbean based streaming services, and a wide range of mobile applications delivering a variety of content. The capabilities and cost savings allowed by these services also allow for an increase in innovation and the use of technologies that enable businesses and industries in the region to be more productive and efficient.

The proliferation of OTT services in the region is carries some major implications, because these services, as in the rest of the world, remain largely unregulated. In the absence of clear net neutrality provisions, operators have begun to utilise methods such as outright blocking of OTT services and throttling of bandwidth to diminish the quality of what is delivered to end-users.

In 2014, controversy began to emerge around the blocking of VoIP based services on mobile networks in the region. Criticisms of such methods have been met by calls from network operators across the region to regulate OTT services. They argue that the increased demand for bandwidth placed on the networks as a result of OTT traffic diminishes the Quality of Service (QoS) offered to consumers. Another claim is that the absence of regulatory parity makes it very difficult to compete with services that form a viable substitute to what they offer.

The Eastern Caribbean Telecoms Authority (ECTEL) has endorsed the principle of an open Internet, and in September 2015 appealed to network operators to stop blocking OTT services.[2] They also urged consumers to report such instances to their respective regulators. The Telecommunications Authority of Trinidad and Tobago (TATT) opened up a public consultation on the treatment of OTT services last year. While the Jamaican government in 2014 expressed its intent to regulate VoIP services, it has yet to introduce any legislation. It is clear that there have been varying approaches towards dealing with the proliferation of OTT services in the Caribbean, and there is definitely need for consensus in the region on this matter.

The treatment of OTT services most likely depends on how it is viewed in the market in which it is being dealt with. Some view it as a “disruptive threat,” while others view it as an “innovative opportunity.”[3]

In the Caribbean, we have benefited from the many opportunities that OTT services have made available to us on an individual basis as well as from a commercial point of view. Local developers have been encouraged to produce content tailored to our region, and it is essential that any regulatory framework allow such innovations to thrive, as oppose to stifle them. This of course has to be balanced with the need for continued investment in the crucial networks that support these services.

There are other implications of imposing regulation on OTT services. Content providers argue that such interventions would subject them to costs that would have to be passed on to consumers. This diminishes the appeal of the service and acts as an impediment to regional content providers wishing to access their audience through this means. This also goes against the philosophy of a free an open Internet on which net neutrality principles are formed.

Regulators and policy-makers should not be focussed on imposing strict rules on OTT providers, but rather seeking to promote partnership and collaboration between them and network operators, so that both can thrive in this environment and continue to equip the region to be productive. In order to increase profits, network operators can be encouraged to diversify their products through the creation and offering of their own content.[4]

Another opportunity presented is one of partnership. Traditional telecommunication companies can seize the opportunity to join forces with local content providers. This will allow them to increase the loyalty of their subscribers instead of alienating them by impeding their access to OTT services.[5]

Regulatory certainty in this instance needs to be a priority in the region. Internet users continue to be subject to the throttling of bandwidth and other prohibitive measures taken by network operators to “protect” their networks from the effects of the increased use of OTT services. Policies need to be clear on whether or not free and open Internet principles apply and how network operators and OTT service providers should interact. As mentioned earlier, this is a global issue, but we have the opportunity to address it and provide a clear framework in the region before it escalates any further.

References

[1] Towards the treatment of OTT Services, TATT 2015

[2] ECTEL Public Statement – Over the Top Services – September 2015

[3] Arthur D Little, ‘Arthur D. Little – Publications: Viewpoints’ <http://www.adlittle.com>.

[4] Antonio Ghezzi and others, ‘Generating Innovative Interconnection Business Models for the Future Internet’ (2013) 15 Info : the Journal of Policy, Regulation and Strategy for Telecommunications, Information and Media 43, 58.

[5] ‘Arthur D. Little: Mobile Voice OTT Could Become a Disruptive Force | Business Wire’ (3 November 2011).

Cathrona Samuel has a variety of passions centred on Communications, Technology and Law. She heads the Marketing & Communications Department at the Antigua Public Utilities Authority, which provides nationwide telecommunications, water and energy services. She also works on legal, regulatory and compliance issues related to the company. She is on Twitter at @cathronasamuel.