ALTON decries impact of OTT on telecom operations

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The Association of Licensed Telecommunication Operators of Nigeria (ALTON) has decried the impact of over the top service (OTT) on the telecom operations in the country.

Engr. Gbenga Adebayo, Chairman, ALTON, said: “In Nigeria over the top service (OTT) providers utilizes traditional Mobile Network Operator (MNO) infrastructure to offer social networks, voice and instant messaging services to retain users loyalty and drive stickiness, with a view to create large on-line communities and eventually attract huge advertisement revenues.”

OTT services in Nigeria include Voice and Messaging service applications such as: WhatsApp, WeChat, Skype, Facebook, Viber, Imo, among others.

The Mobile Network Operators (MNO), he said, has neither rights nor control over the OTT services, as its customers have the discretion to use the Internet as desired.

“Increasing usage of OTT services by customers is adversely impacting on traditional telecoms platforms.

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.”