Why People are Annoyed with the Draft Telecom Bill?

But why are we talking about the Licence Raj now?

Well, it seems the government may have gone overboard with a few things while drafting India’s Draft Telecommunication Bill of 2022. And it might change how people do business in India.

The entire issue boils down to a simple change in definition. The government wants to redefine what telecom services actually mean. Right now, you have to be using physical infrastructure to qualify as a telecom provider. You know like Airtel, Jio and VI. And they pay a fee to use airwaves (spectrum).

But now, it looks like the government wants to include Over-The-Top (OTT) platforms such as WhatsApp in its purview too.

Their contention is simple. Take for instance WhatsApp. It has nearly 500 million Indians on the platform. You can text, make voice calls, dabble with video calls and substitute it for most traditional telecom services. However, while telecom companies have to jump through hoops and pay large amounts of money to facilitate their offerings, messaging apps like WhatsApp can do it by simply bypassing most telecom regulations altogether. No hurdles. No fees.

And the government can’t take its cut.

So they want to fix this loophole. They want companies providing broadcasting services, e-mail services, voice, video or data services, internet and broadband services and even OTT communication services to cough up a fee before they begin servicing Indian customers.

On the face of it, you could argue that this levels the playing field. But there are a few issues.

Telecom companies aren’t like email service providers. They control access to the internet. WhatsApp is built on top of the internet. So if you think of telecom companies as entities facilitating movement across highways, WhatsApp is a mere passenger. And it would be a bit difficult to club them in the same bucket.

There’s one more thing.

The new definition will also probably include the likes of Netflix and Amazon Prime as well. In fact, it may also include any consumer internet company that offers some sort of chat or communication service within the product. And if the ambit expands indiscriminately, cab aggregators, food delivery apps, dating apps, and stock trading platforms with customer chat support could also be forced to procure a licence before operating in India.

It could even lay the foundation for many other complications. See, OTT services are bound by rules laid down in the Information Technology (IT) Act. If you ask them to abide by the Telecommunications Act (if the Draft Bill becomes law) they would now have to comply with a different set of regulations imposed by a different ministry. You could see scuffles between ministries and regulators. We’ve seen this in the past — when the Telecom Regulatory Authority of India and the Competition Commission of India tried to reign supreme over telco disputes.

Then, there’s the matter of encryption. Most OTT messaging services are encrypted end-to-end. That means, third-parties can’t see the messages. Only the sender and receiver are privy to the information.

But the government may want to take a peek sometimes. Sure they'll argue that these extraordinary powers will only be used in extraordinary situations, but sometimes governments do have a tendency to go overboard.