Is there a need to regulate OTT services?
Guest Column: Ritwika Nanda and Prateek Arora, Advocates for Trust Legal, share insight on the various aspects of the booming OTT scenario and whether regulations will boost or hamper the services
Published - 20-May-2019
OTTs are gaining popularity as they provide unregulated content, most of which is free and easily accessible. With the advantage of a global reach, OTTs have seen a rapid increase in the number of consumers availing such services.
Until recently, broadcasters, DTH operators, multi-system operators and cable operators were the only players in the market providing TV channels but the entry of Over The Top (OTT) services has caused a shift in the trade.
Different operators and broadcasters have been regulated under the Cable TV Regulation Act, 1995 and TRAI Act, 1997, under which they have to comply with the laws and regulations framed by the concerned authorities. As far as OTTs are concerned there is no regulation for OTT services and they are free to stream their content without any restrictions or licensing.
There are two aspects which concern the stakeholders - one regarding revenue and the other pertains to regulatory compliances. As far as the OTTs are concerned there is no regulation regulating the services but the Broadcasters, MSOs and other operators have to seek licences, pay carriage/licence fee. With regard to the revenue, OTTs generate revenue by advertisements/subscriptions but due to regulatory constraints DTH and other operators are not in a position to collect revenue from other sources like OTT.
Is there a need for regulations?
The OTTs have taken a stand that they are already regulated under IT Act, 2000, and other relevant laws and TRAI has no jurisdiction. Over regulation of OTTs will kill innovation and easy access of OTT services to the customers. Similarly, DoT Committee on Net Neutrality in its report has recommended that OTT application services should be actively encouraged and any impediments in expansion and growth of OTT application services should be removed.
Services like Hotstar/SonyLIV are broadcaster-owned streaming apps that wish to distribute their content freely and believe that over regulation is likely to kill the market. The OTTs have pushed for and voluntarily signed a self-regulatory Code of Best Practices and opposed government intervention.
Why it must be regulated
Stakeholders operating Cable, DTH and IPTV services have contended that OTT platforms have created a non-level playing field by offering the same shows/channels playing on TV on an app at the same time.OTT services may be looked at as IPTV services. Transmission and Broadcasting using internet as a means would then also require a license from the Ministry of Broadcasting.
Apart from standardised rates and licences there are many content based issues with OTTs. The Supreme Court in SLP (c) 10937/2019 - Justice for Rights Foundation v Union of India & Ors. has issued a notice on 10.05.2019 to the respondents. This appeal arises out of the final judgment passed in WPC No. 11164/2018 by the Hon'ble Delhi High Court. The writ was filed praying for an order to direct the government to frame guidelines in order to regulate the said online platforms and contents broadcasted on the online platforms. Further, the health ministry also has concerns with OTTs not displaying anti-smoking messages in TV shows and movies.
TRAI is likely to come out with its recommendation or regulations within a month. It would be reasonable to say that the regulation of content and requirements for a licensing framework looks to be inevitable for OTTs.
(The article has been authored by Ritwika Nanda and Prateek Arora, Advocates for Trust Legal.)
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