The Body of European Regulators for Electronic Communications (BEREC) has opened a consultation on its draft report on OTT services, published yesterday. The consultation will close on 2 November.
The draft report considers that companies that offer OTT telecom-like services such as Skype and Whatsapp, should not be necessarily regulated as claimed by traditional telecom operators. The final report will be then issued by BEREC in the context of the review of the current EU regulatory framework for electronic communications (ECN/S Framework).
About the BEREC
The BEREC is composed of the representative of the communications regulators of all the Member States of the European Union. It was established by Regulation (EC) No 1211/2009 adopted in November 2009, as part of the ECN/S Framework package. It replaced the European Regulators Group for electronic communications networks and services which was established as an advisory group to the Commission in 2002.
BEREC assists the Commission and the national regulatory authorities (NRAs) in implementing the ECN/S Framework. It provides advice on request and on its own initiative to the European institutions and complements at European level the regulatory tasks performed at national level by the NRAs. The NRAs and the Commission have to take utmost account of any opinion, recommendation, guidelines, advice or regulatory best practice adopted by BEREC.
Therefore, public consultations on BEREC’s reports represent an extremely useful tool for market operators to ensure that their views and needs are taken into account by the EU regulators when preparing a legislative proposal.
OTT is a term frequently used but often not clearly defined. Some use this term to define a group of actors, while others to qualify a category of services.
In its draft report, BEREC defines an OTT service as “content, a service or an application that is provided to the end user over the open Internet.” This means that the term OTT does not refer to a particular type of service but to a method of provision, namely provision over the open Internet. The provision generally occurs independent of the Internet access provider in control or distribution of the service. BEREC distinguishes three types of OTT services:
- OTT-0 services, which are OTT services that qualify as electronic communication services (ECSs);
- OTT-1 services, which are OTT services that do not qualify as ECS but do potentially compete with ECSs; and
- OTT-2 services, which are the remaining category consisting of OTT services that are not an ECS and do not potentially compete with ECSs.
A first objective of the consultation is to define the OTT services. Part of this task is to identify which OTT services qualify as ECSs in a legal sense and therefore should comply with the current rules and regulations set out in the ECN/S Framework.
A second objective of the report is to assess if the OTT phenomenon should be considered within the ECN/S Framework review. As part of this second objective, BEREC looks at differences in the regulatory treatment of ECSs and OTT services that potentially compete with ECSs and whether or not this could distort the level playing field.
To this regard, traditional telecom providers have complained for several years that they suffer a competitive disadvantage with respect to internet-based services competing on telephony and messaging (e.g. Viber, Facebook Messenger, Skype, WhatsApp). Indeed, traditional operators are subject to rules including price caps, obligations to serve disabled users and privacy restrictions, which do not apply to the latter. However, the draft report concludes that the differences in the regulatory treatment between ECS and OTT services involve many relevant considerations and that the ‘level playing field’ is only one of them.
Finally, the draft report also considers (i) OTT services that do not potentially compete with ECS and (ii) partnerships between ECS and OTT providers. BEREC considers that although both in general lie outside the scope of NRA’s competence currently, they could have an effect on competition and consumers in the markets for ECSs.