Above: Illustration by Simpson33/123RF.com

BitDepth#1373 for September 26, 2022

The Telecommunications Authority (TATT) published its new discussion paper on the issue of Over The Top (OTT) services at the end of August.

The new paper reframes a contentious top-level discussion about OTTs that’s been going on since 2015.

Early discussions about the impact of these services were prompted by the burgeoning success of new Voice over IP services like Viber and WhatsApp, that were just beginning to take a chunk out of the incomes of local telecommunications providers.

In its newest iteration of this running discussion, TATT describes an OTT as a “Content, service or application, accessed by the public via the Internet, that may be a direct substitute for, and/or may compete with a public telecommunications and/or broadcasting service.”

Today, this describes almost everything that people use with any regularity on the public internet, and over the past seven years, most connected users have become quite comfortable with accessing alternative services using internet protocols.

In the face of increasingly entrenched expectations, TATT is forging ahead with plans for both short-term and long-term regulation of OTTs using existing legislation and developing international law as a guide with a view to proposing amendments to local law to regulate these services.

With the market for OTT media services pegged at US $121 billion, there is an increasing expectation that these services should contribute to the infrastructure expansion that is undertaken to accommodate it.

Why would TATT want to regulate OTT services?

OTT services now use existing telecommunications infrastructure at a rate that few providers might have anticipated.

During covid19 lockdowns, for instance, video conferencing surged dramatically with a commensurate demand on service providers, while streaming video has been using increasing bandwidth.

TATT does not report on the penetration of OTT services, but some idea of the scope of that use can be inferred from its impact on the numbers that the authority does report.

For instance, between 2012 and 2020, according to TATT’s 2021 annual report, total internet subscriptions doubled from 646,000 to 1,147,000.

In that time, revenue from outgoing long distance calls dropped from $263.5 to $58.5 million.
PayTV subscription numbers rose slowly during that time, rising from 198,700 to just 242,400.

Netflix does not break out the Caribbean in its reporting for the Latin American region, but the region accounts for roughly 35 per cent of the company’s subscriber base, but delivers a growth rate of only one per cent. Europe is growing at 11 per cent; the US and Canada at 10 per cent and the new Asia-Pacific region is at nine per cent.

It’s worth noting that Netflix, the first major streaming provider to officially offer its product to the TT market announced availability in 2011.

Estimates of broadband use on local networks by the streamer in recent years have ranged from 50 per cent to as much as 80 per cent of bandwidth in use.

TATT sensibly notes that, “Trinidad and Tobago may face limitations in establishing regulatory structures on multinational OTT providers. On its own, the market size may be too small to offer significant incentives for OTT providers to retain their services in the country following authorisation requirements.”

Even if the authority is somehow able to persuade the region to act collectively in this matter, the aggregate size of the Caribbean is unlikely to persuade any streaming service to abide by any regulation it considers too onerous.

Which regulator wants to explain to Bridgerton fans why Netflix isn’t available to them anymore?

The two-decade-old history of cable TV’s struggles to license content for its channels provides a useful precedent for that ambition.

In April, Flow announced an arrangement to deliver Paramount+ to Caribbean viewers, signalling an inclination to partner rather than battle.

Digicel has taken a local lead in developing OTT services such as D’Music and BiP, but they are still to make a tangible impact compared to juggernauts like WhatsApp, YouTube, Netflix and Spotify, which command local markets.

Fighting for local content contributions on streaming services is an opportunity for the creative sector, but there’s little in existing catalogues that meets the technical requirements of major streamers (other services cater for Caribbean legacy content) and developing content for these platforms will be the work of the future.

Finding a lever point between growing market demand for OTT services and the diffidence of these foreign-based services to regional regulation it isn’t clear what TATT’s effective intervention strategy is here, particularly since it continues to fail to enforce something as straightforward as number portability even with the force of a legal ruling backing them.