Demands for imposing revenue share between internet cos, telcos akin to rent-seeking: IAMAI

The Internet and Mobile Association of India (IAMAI) has said demands made by telcos for revenue sharing mechanisms between internet companies and telecom service providers (TSPs) ‘smack of rent-seeking’, and would disincentivise growth for OTT-based businesses.

According to IAMAI, by requiring “largest” OTT service providers to pay TSPs for data used by consumers, the telecom players would effectively be charging twice for the same service, since they already charge consumers for data.

“In any case, ‘surging data traffic’ is merely data consumed by consumers that they have already purchased from telecom companies. Therefore, the ‘strain’ on infrastructure of TSPs occurs when they sell data to consumers beyond their infrastructural capacity – a fact that has been conveniently ignored,” IAMAI said in a statement.