ALTON Fights Back as OTT Soars, Erodes Revenue

Citing the high mortality rate of telos in Nigeria, Association of Licensed Telecoms Companies of Nigeria (ALTON), has called on the Nigerian Communications Commission (NCC) to take a second look at the activities of Over-The-Top (OTT) players.

ALTON insists the time has come for the regulator to re-examine its position on issuing technology neutral licences because of emerging issues in the industry.

Gbenga Adebayo, chairman, ALTON, also said that OTT services, have social implication, economic implication, security implication and if they are not licensed.

“That means they are not regulated and if they are not regulated, there is no limit or scope to what they can do.  And no control over their services and content they can provide” Adebayo said.

In real truth, the problem is the proliferation of Over the Top messaging apps and internet call, which use the internet to deliver content, is eating into the revenue telcos used to enjoy.

According to Ovum, the independent analyst and consultancy: The growing adoption of OTT services by customers instead of traditional telecoms services will occasion global revenue loss of $386bn over a period of six years (2012 – 2018) for the traditional telecom operators, thus endangering network development.

Some of the ’displacement effect’ according to Adebayo are ‘declining voice minutes due to impact of OTT while VoIP has been increasing, OTT Data flux has been increasing as shown with the 2016 data, Telcos are losing money due to this trend.’

He said that urgent action is required to save Telcos further loss due to activities of OTT players who do not invest in infrastructure.

“Telecom Operators incur the Costs while OTT players make the money. Telecom operators invest a lot on network infrastructure in order to provide basic and innovative services to customers. Core voice and SMS revenues are decreasing continuously due to impact of OTT players who offer voice, video and messaging services free of charge to their users. Telecom operators will continue to invest a lot to make the networks support the data tsunami, with the required quality of service and numerous innovative services.

“On the top of their infrastructures and customers, they will strive to keep with huge investments, the OTTs are offering contents & applications, using huge amount of Telcos bandwidth, collecting revenues but paying nothing to the Telco operators and to the government.”

He added that, the increasing adoption of OTT applications by telecom subscribers negatively impact on incoming international traffic as well as SMS at huge cost to the Telcos but revenue to OTT.

“OTT players also hold many customers personal data they can use for any desired purpose without risk of being sanctioned by the government while Telcos are not permitted to use or disclose subscriber information to third party.”

ALTON however recommends in line with international trends, ’same service, same licensing” regime to avoid distortion in the digital landscape.”