On 6 June 2018, GSMA Europe hosted a Mobile Meetings Series on “The rise of OTTs: user trends & policy challenges”. The event focused on the policy challenges, market dynamics and fast-changing consumer trends linked to the emergence of OTTs.
The telecommunications market and consumer habits are changing rapidly. As for other sectors, internet-based innovation has brought new challenges for mobile operators. An arising set of internet-based services, the so-called over-the-top (OTT), is increasing the demand for broadband access and the importance of mobile connectivity in our daily life. It is estimated that in few years’ time OTT companies will have captured 10% of global revenues from the telecommunications value chain.
When the Digital Single Market Strategy was adopted, OTTs were not well-placed or defined in the EU agenda yet. Now, OTTs play a big role in the digital ecosystem and the regulatory distinction between telecoms and OTTs represents a major matter in the EU digital framework, notably for the Electronic Communications Code and the ePrivacy regulation.
During the event, participants discussed the key policy challenges resulted from OTTs emergence: ensuring fair competition, providing certainty over regulation and defining the scope of OTT businesses. The discussion highlighted the dichotomy between sectoral legislation and horizontal rules as well as the need to have more flexibility to foster investments in a new generation of networks. In this regard, attendees agreed that fair competition is essential as telecommunication companies must invest in building and upgrading infrastructure in order to meet the growing demand for high-speed, high-quality internet and, ultimately, achieve EU’s Digital Agenda goals.
Connectivity is the main loop between OTTs and mobile operators. Mobile networks are essential for users to access OTTs services. Therefore, attendees stressed the importance of their partnership and that mobile industry and OTTs companies shall work together for the upgrade of networks and for handling the increasing stream of data. The debate over mobile connectivity brought the attention on the evolving role of mobile industry in content distribution (e.g. media services). To keep up with user’s demand, mobile operators are teaming-up with media companies and providing a new set of services.
During the meeting, participants also discussed the nature of OTTs and their key features. The debate emphasised the different business models of OTTs and to what extent they represent a challenge to create a level of playing field. Many attendees pointed out the need to explore the implications on competition authorities’ work and on whether competition law can address the arising issues from OTT emergence. Some of the participants agreed that the right competition tools are already in place and they need to be adapted to this new eco-system but not reviewed.
The major takeaways of the discussion were the relevance of collaboration among providers for fostering users’ access and trust as well as the need for flexibility over regulation, given the fast-moving and interrelated eco-system where mobile industry operates.
Hosted in our offices, the Mobile Meetings Series are small scale – but big scope – invitation only events for the Brussels public policy audience. Join us for a different take on the main issues affecting the mobile communications industry and its place in Europe’s information society.