An industry grouping representing India’s top three telcos has accused global consumer-technology majors, such as Microsoft and Amazon, of “presumably circumventing and bypassing the legal telecom route” by using WhatsApp and other unregulated platforms to send enterprise messages to customers, causing a likely Rs 3,000-crore annual revenue loss to both the Centre and the service providers.
“Renowned international corporates such as Amazon and Microsoft are presumably circumventing and bypassing the legal telecom route by disseminating messages to Indian customers via WhatsApp, Telegram,” the Cellular Operators’ Association of India (COAI) wrote in a letter to telecom secretary Neeraj Mittal. “This is not only an alleged gross violation of licensing and security norms but is also a clear loss of revenue for the exchequer and also loss of forex earnings.”
ET has seen a copy of the letter, dated October 31, written by the industry body that represents India’s three private telcos – Reliance Jio, Bharti Airtel and Vodafone Idea.
The letter also urged the Centre to “declare WhatsApp/Telegram as an illegitimate route for such (enterprise) communication,” which includes time-barred one-time authentication passwords needed for device access or validation of transactions.
Individual companies named in the COAI letter, such as Amazon and Microsoft, did not immediately respond to ET’s emailed queries seeking comment.
WhatsApp & Telegram
Fortune 500 companies, including the technology majors, OTT platforms, some financial institutions and e-commerce sites use international A2P (application to person) channels such as WhatsApp to reach out to their customers for promotions and authentication through OTPs. The regulated SMS service offered by telcos is supposed to be used for such purposes, the industry body said.
“In utter disregard to licensing norms and regulations, we are now witnessing a surge in diversion of such traffic from the SMS channel to purely OTT channels, i.e. WhatsApp and Telegram, in a clear attempt to avoid the licensed route via telcos, thus impacting security norms while also leading to clear loss to the exchequer,” the COAI argued. If the practice is not curbed, it could encourage the use of “grey and unmonitored routes, which can pose a security threat for the nation,” said the industry grouping.
Additionally, it said, that the potential revenue loss for the industry and national exchequer would amount to Rs 3,000 crore.
A recent Frost and Sulivan report said the size of enterprise messaging for India’s telcos, in FY23, was just shy of Rs 2,500 crore. Telcos stand to lose a chunk of this revenue if enterprise messaging, increasingly relevant in the context of rapid expansion in digital payments and e-commerce volumes, moves to platforms such as WhatsApp.
During Bharti Airtel’s fiscal second-quarter earnings call, Managing Director Gopal Vittal referred to this practice and reiterated the need to have common regulations for different technologies delivering the same service – in this case telcos, and OTT communications platforms. In a separate letter to telecom minister Ashwini Vaishnaw, the telcos demanded that such communication apps be regulated by extending the remit of telecommunication services in the upcoming telecom bill.
App makers have previously pushed back on attempts to bring them under telecom regulation, saying they are already covered under the IT Act. Any further regulation will stifle innovation, they have said.
In the Oct 31 letter to the telecom secretary, the COAI reiterated that OTT communications platforms are not regulated and as such, unlike the telcos, have no obligations to maintain data privacy. By contrast, it added, the licensed route is regulated and has differential pricing, preventing unsolicited international alerts and messages prone to financial fraud.
Fees for receiving alerts
The use of unlicensed routes to send international messages to Indian consumers has been highlighted by the telcos in a discussion paper on defining international telecom traffic. While domestic enterprise communications are charged Rs 0.13 per message, the international enterprise alerts cost around Rs 4-4.5 per message. Telcos have claimed that tech companies are using the unlicensed route to avoid the international enterprise message charges.
COAI also highlighted that messaging using SMS route is regulated by the Telecom Commercial Communication Customer Preference Regulation (TCCCPR), 2018, which includes consumer consent as a caveat for businesses to be able to send out messages to customers. However, since the OTT platforms sit outside the regulatory framework, the TCCCPR mandate does not apply to them, making it easier to send unsolicited messages over platforms like WhatsApp and Telegram.
“While telcos are being penalised on every spam complaint by imposing financial disincentives, the OTT platforms (WhatsApp and Telegram) remain shielded as they have no governing framework,” the COAI said.