This article has been written by Vishakha Shakya and Kartikeya Misra, 3rd year law students at Dr. Ram Manohar Lohiya National Law University, Lucknow
The past two months have been turbulent for the Over the Top (OTT) Services Sector. The change has been dramatic from the earlier tussle between ministries and regulators to the Telecom Disputes Settlement Appellate Tribunal’s (TDSAT) order ousting the Telecom Regulatory Authority of India’s (TRAI) jurisdiction over OTT platforms. The introduction of Draft Broadcasting Services (Regulation) Bill, 2023 has further fueled conversations on the regulation of OTT platforms. Thus, there is a dire need to understand the regulatory landscape and the issue of overlaps to establish a clear regulatory framework.
THE TIGHTROPE OF OTT PLATFORM REGULATION: WHO AND HOW?
Currently, the OTT platforms are regulated under the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, which propose a soft-touch regulatory approach. However, in the past, OTT platforms have been in muddy waters relating to who actually has regulatory power over them. In October 2019, the government, made a significant move and brought OTT platforms under the regulatory ambit of the MIB. On many such occasions, the ministries and departments that overlap have seen differing views on some issues. For instance, in 2022, in a consultation organised by Department of Telecommunication (DOT), DOT backed the regulation of these OTT platforms, while the Ministry of Electronics and Information Technology (MEITy) sided against any regulation. Interestingly, in the consultation, MIB refused to provide its views due to the belief that regulating these spaces came entirely under its domain. DOT sent all the suggestions as a reference to the Telecom Regulatory Authority of India (TRAI) to relook its stance of no regulation of OTT platforms since the 2020s.
Section 2(21) of the Draft Telecommunication Bill, 2022, included OTT platforms in the definition of telecommunication services. MEITy had raised issues about the regulation of OTT in the manner provided by the Draft Telecom Bill in the consultation, after group consultation, after which the issue has been under consideration.
TRAIs stance has also differed from time to time. For instance, in 2020, TRAI recommended against the regulation of OTT platforms. But, since 2022, TRAI has been actively interested in discussions about the regulation of OTT spaces and had released a consultation paper for the regulation of OTT spaces.
So, the regulatory tussle can easily be classified into two questions: Who? And how?
THE TDSAT ORDER AND ITS IMPACT ON THE OTT REGULATION
According to a report by Deloitte, the Indian OTT realm is highly price sensitive. Platforms like Hotstar have chosen to offer free access to their content in this competitive market where numerous OTT platforms compete for viewers’ attention. One such case of providing free content by downloading their OTT application on mobile phones and permitting viewers/customers to view Star Sports free of charge has come to the limelight. The case was heard by the TDSAT. The discussion went around whether TRAI regulates OTT platforms.
The case stemmed from a petition filed by the All India Digital Cable Federation against Star India Pvt Ltd. Petitioner alleged that Star India was violating Regulation 3(2) of the Telecommunication (Broadcasting and Cable) Services Interconnection (Addressable Systems) Regulations, 2017 by offering free streaming of Cricket World Cup matches on their OTT platform while viewers accessing Star Sports had to pay for the channel. The petitioner had requested for interim relief, asking the respondent to stop offering the said channel for free on the OTT platform.
During the proceedings, the petitioners argued that although the definition of a ‘Distribution Platform’ in Regulation 2(r) did not explicitly mention OTT platforms, it could be interpreted broadly. In response to this, the respondents contended that OTT platforms were not covered by this definition, emphasizing its exhaustive nature.
Finally, in the order, the TDSAT held that OTT platforms are not under the purview of TRAI. The ruling clarified that an OTT platform is distinct from a television channel and, therefore, does not require government permission or licensing.
This order stood in stark contrast to the evolving stance of TRAI regarding the regulation of OTT communication services like WhatsApp and Google Meet.
By explicitly stating that OTT platforms do not fall under the purview of TRAI, this ruling has created a distinct demarcation, indicating that OTT platforms differ from traditional television channels and do not require governmental licensing or permission for operation. This decision had accentuated the prevailing ambiguity regarding regulatory oversight, casting doubts on TRAI’s role in governing these platforms.
THE NEW BILL AND THE EVOLVING OTT SPHERE
The proposed Broadcasting Services (Regulation) Bill, 2023, heralds an attempt to modernise India’s broadcasting regulations by encompassing OTT platforms and digital news services. This, indeed, is a commendable and positive step towards regulation of the OTT, by the MIB. In the proposed Bill, Sec 20(2) brings News and Current affairs programmes “as part of a systematic business, professional, or commercial activity” to be at par with the OTT Broadcasting Network Operator but with the practical differences between them being kept in mind.
However, the bone of contention lies in what would be classified under OTT broadcasting services and what not. For instance, financial influencers might be subjected to the same obligations as an OTT broadcaster under the new Bill. This implies that YouTube, classified as a social media intermediary, might not need to comply with the Act. However, the paid subscription service, YouTube Premium, could qualify as an OTT broadcasting service and thus be subject to the Bill. Differentiating between news content and user-generated content on social media is a challenging task, regulated by the MIB and the MeitY respectively. Therefore, the ambiguity arises from uncertain platform classifications and the split regulatory authority over various content and services. This lack of clarity poses challenges for effectively enforcing the proposed regulations. To address these issues, clear guidelines are essential to establish a more defined framework for compliance and regulation in the digital domain.
There has been much development in the sphere of OTT regulation recently. It is clear from the attempts until now that OTT space is a complex area of regulation that requires coordination and cooperation among different ministries and departments. Although the new bill has improved the clarity in the regulation of OTT platforms, there persists a need for these overlapping ministries to coordinate and develop guidelines to develop a clear and robust regulatory framework to increase the overall regulatory control of this domain that caters to industry needs and safeguards individual rights within this domain.