Telecom operators want OTT players to pay for use of networks

Paying for the use would ensure a more fair and sustainable business model for themselves since they invest in setting up and maintaining the networks, telecom companies said at a meeting with the Ministry of Information and Communications on April 6.

The CEO of Viettel Telecom, Cao Anh Son, said while telecom operators are witnessing a sharp decline in such services as calling and SMS, foreign OTT service providers operating in Vietnam are growing strongly, some in double digits.

“The operators provide infrastructure for OTT players, but the OTT players do not contribute to development of the infrastructure. The investment burden on the operators is big.”

Data from Viettel shows 80% of Internet traffic between Vietnam and the world is for Facebook, Google and Netflix.

A minor change in user behavior or content delivery, such as upgrading videos from HD to 4K resolution, can put a lot of pressure on network transmission. Bui Son Nam, deputy general director of MobiFone, hoped the amendments to the Telecommunications Law being drafted by the ministry would require cross-border OTT players to share infrastructure development costs with telecom operators.

Nam and Son also pointed out that if cross-border OTT players and social networks cooperate with telecoms operators, it would help the ministry manage platforms and their contents better.

In the amendments being made to the law, the ministry’s Vietnam Telecommunications Authority has called for regulating OTT services such as Zalo and Telegram.

These OTT services are similar to calling and texting, and so should be regarded as basic telecom services on the Internet and need to be brought under the Telecommunications Law.

In March European telecom operators asked big tech firms in the U.S. to pay for the use of their networks.

But the latter argued that they should not be asked to pay for the use of networks because they are already paying for the data they use as consumers.

It would stifle innovation and competition in the internet and OTT space, and could lead to higher costs for end-users, they claimed.

At a seminar held to discuss the proposed amendments on March 23 Vu Tu Thanh of the US-ASEAN Business Council said 10 years ago U.S. telecom company AT&T asked OTT players to pay, resulting in a major controversy.

Eventually, OTT players did not pay after the principle of net neutrality was invoked to prevent discrimination between various services on the Internet, he said.

“For example, high-priced services will be prioritized for bandwidth, while bandwidth for free services will be squeezed. This will make it difficult for essential social services, and services for small and medium-sized businesses.”