Real Motives behind Regulation of WhatsApp and Google Hangouts
The Parliament Portfolio Committee on Telecommunications & Postal Services had a meeting on the 26th of January 2016 to discuss the need for regulating WhatsApp and other over-the-top (OTT) service providers.
Over-the-top services, such as WhatsApp, Google Hangouts & Skype, make it possible for people to make calls using the internet and thus their existing data to connect with others across the globe. Users only pay for the data they use, meaning that they don’t have to pay per SMS or call.
For MTN and Vodacom the problem is that they don’t earn anything on the calls or texts from OTTs. WhatsApp, Skype and Google Hangouts are able to offer the services free, because they make money from advertising. Since they are internationally based, they can offer their services across geographical boundaries, unlike MTN, Vodacom and Cell C that can only offer services to subscribers within their jurisdiction. Mobile network users pay high amounts for international calls, making it a better option to use for instance, Skype to call overseas.
The mobile networks argue that they are licensed and because of the regulations, they have to invest a lot of money annually to upgrade their networks, make services available nationally and ensure best quality of service regardless of how many users are in a geographic location. They want OTTs to be regulated in the same way.
They argue that OTT services are available through internet connectivity and thus use data (bandwidth) with the users connecting to the internet through Telkom or one of the mobile networks. As such, the OTTs run on the existing communication infrastructure and don’t need to develop infrastructure of their own. Surprisingly, Cell C came out in support of non-regulation, arguing that corporate greed is behind the drive for regulating of OTTs. Other stakeholders have added that since users already pay for the data from the mobile networks, how they use the data shouldn’t be regulated.
If the OTT services are licensed, Google and Facebook will then have to charge users, reducing their competitive edge. Any such regulation in terms of taxation, having to pay for infrastructure development and having to ensure availability nationally will mean expenses to be carried for offering free services.
The two giants will have to rethink whether the services should be available to South Africans at all. In the worst case scenario, the public will end up paying for the services or have no access at all. Regulation will also mean control over content and the privacy settings of users, taking away the freedom to discuss issues without Big Brother lurking.
Many players feel that the mobile networks want to stifle competition through regulation so that they can keep their prices at existing levels. In South Africa, where many consumers cannot afford the high communication costs of mobile networks, WhatsApp provides a welcome alternative. If users have to pay for the OTT communication, they will end up paying double, because they’ll be paying for both the bandwidth and the service.
Fast, efficient and cheap communication will be something of the past and we’ll move backwards in time to a period where mobile networks had monopolies over text communication.