S P Kochhar, the Director General of the Cellular Operators Association of India, has argued that there should be a profit-sharing arrangement between Over-The-Top (OTT) service providers and telecom companies when it comes to using 5G networks.
He pointed out that while telecom companies handle the traffic of both voice and data, the majority of network usage is driven by OTT players who transmit large amounts of data to end users. These OTT players source content from providers, distribute it through their platforms, and deliver it to users without compensating the network providers who have invested in creating the infrastructure.
Kochhar mentioned that OTT platforms like Netflix, Amazon Prime, Zee5, and SonyLIV have substantial user bases in India and stand to benefit from the deployment of advanced technologies like 5G.
He used the analogy of building a house, where one floor is occupied by the owner, and the other floors are rented out for commercial purposes. However, the tenant using these floors for business doesn’t pay any rent to the owner. Kochhar deemed this situation as unreasonable, suggesting that while he doesn’t expect the entire profit earned by the tenant to go to the owner, there should be some form of compensation for the use of the infrastructure.
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Telecommunication companies are experiencing financial difficulties due to the substantial capital expenditure they’ve invested in deploying 5G infrastructure. Kochhar further stated that they are seeking equitable compensation for establishing, upkeeping, and operating these networks.
According to reports, India’s video Over-The-Top (OTT) market is projected to reach $12.5 billion (approximately Rs. 1,03,890 crore) by 2030, primarily due to improved network access, digital connectivity, and widespread smartphone usage.
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