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French electronic communications regulator ARCEP recently asked prosecutors to investigate that question after a failure by Microsoft’s Skype unit to register as a telco operator despite several requests to do so. Since
Skype provides what is, essentially, telephone service to the public, ARCEP argues, it should comply with regulations and obligations that include routing of emergency calls and implementing the means to perform legally-ordered wiretaps. Media and telecommunications companies in France also claim that they are unfairly subsidizing over-the=top services like Skype that use their bandwidth and content but do not share revenue.
For its part, Skype claims that it has communicated to ARCEP its view that it is not, under French law, a provider of electronic communications services and that it would continue to work with the regulator “in a constructive fashion.”
The issue raises larger questions about internet-based communications and what, exactly, constitutes a telco provider. Should OTT players be regulated like established telecommunications operators? What steps should telecommunications operators take to remain competitive?
The changing face of communication
In the not-so-very-distant past, customers had only one financial arrangement when it came to mobile services – with their operator. Now, users are inundated with VoIP smartphone apps that promise, rightly or wrongly, cheaper and better service. In essence, telco companies are being made to transport rivals’ data without sharing in the revenue.
Established carriers are reacting to this change in different ways. Some are launching value-added services of their own to compete directly with OTT offerings, while others are signing deals with OTT players. Skype, for instance, signed a deal with several carriers last year to allow customers to purchase credits directly on their smartphone or other device and have the charges show up on their monthly phone bill.
Others are using the power of big data to discover and analyze customer behaviors and allow them to compete more effectively with over-the-top players. If companies can understand why and how customers are using a certain platform, for instance, they can develop their own strategies for tapping into that market. An established carrier may, for example, be able to offer similar services to a given OTT player, only with improved call quality and a more integrated user experience. In this case, it would only make sense for customers to stay with the carrier.
Moving to the cloud
As telco providers put more of a focus on rich content and applications, carriers have the opportunity to transition into data-only models that distinguish themselves through branding and value-added services such as high-quality video conferencing, messaging and mobile office environments.
Providing these software-as-a-service and infrastructure-as-a-service solutions will require carriers to leverage existing assets as well as controlled and scalable carrier-grade servers. It’s essential that telco providers choose the right high-performance hardware and framework to make this change go as smoothly as possible, but, all things considered, the cloud era makes this shift not only possible, but fast and flexible.
How do you see OTT players impacting the telco industry?
Jared Jacobs has professional and personal interests in everything technology. As an employee of Dell, he has to stay up to date on the latest trends and breakthroughs in large enterprise solutions and consumer electronics buying trends. In his spare time he is tinkering with sound systems and other awesome gadgets he can get his hands on. He’s also a big Rockets and Texans fan.
