[iamswift]

Originally Posted by Steeroid

What if I built/bought a car and you got to drive it around for free, and even create a customer base of people who share the ride with you?

Thats what OTT (Over-The-Top) services do today - the telecom operator provides the bandwidth and capacity for IP, paying thousands of crores in spectrum charges and then a few thousand more to set up and upgrade the network to carry all that traffic.

Without the operator's network and their customer acquisition drives (marketing costs, customer care costs, distribution costs) on top of Network and infrastructure costs, these OTT players would not exist. So if you provide a free ride to people and then sell your 'business' to someone else for $19 Billion, people are going to ask you to cough up sooner than later.

In the ideal world, the OTT players would foot the bill as cost of services provided, but if they are not willing to do so, then the customer will have to. The customer then needs to decide whether he/she is willing to pay for what was a 'free' service thus far.

Nothing is 'free' - you either pay for it with money, or you pay for it with your privacy (lack of) as with Google/Android services. You can choose the mode of payment, but ultimately it is going to cost you something.

In another view:
Govt is building roads (bandwidth, capacity blah blah blah)
Car buyer pays road tax for using the roads (end user pays internet service charges)
Why car manufacturer should also pay road tax?

[pratyush6]

It's plain opportunistic that's all. The Indian Govt and authorities are always trying to loot money off the people by the polices.
First the bloody taxes in India which is put to use only by the politicians and never for the people who really need it, then add further taxes and say, only 2% of the population will bear it - Gosh! Pathetic state of affairs.
These companies have sprung up 'because' of the exorbitant pricing of telcos - An sms costs next to nothing to an operator; I am still billed for it - almost at the rate of voice calls, do not even talk about the ridiculous mobile internet charges. So you know see another area where you can pin people down, go ahead, make a new policy.

[binand]

Originally Posted by Steeroid

What if I built/bought a car and you got to drive it around for free, and even create a customer base of people who share the ride with you?

Mind you, isn't that customer base paying you for the privilege of being able to talk to the car owner? Doesn't that cost include the perceived value of the car operator's service to the customer? Aren't those users paying you not because of your car, but because of the quality of the drive offered by the car owner?

[kiku007]

Originally Posted by tsk1979

Its look like greed of Telcos is not just confined to the western world.
I already pay for 1GB data. What I transmit with that data should be my wish. Telco is nobody to say what kind of packets that 1GB can contain.

This pretty much sums it up. The average data usage per User should have increased considerably in the past decade and in relative terms the revenue too. So why should they cry foul now?

Originally Posted by Steeroid

There is no such thing as a free service - the cost will materialize eventually (after you're hooked to it), and that is a fact of business.


However if the overall feeling is that "free services" are viable in the long term and will continue to remain 'free', so be it - I do not aim to change anyone's beliefs, but am merely trying to throw light on some fundamental facts. Therefore if and when you all eventually have to pay for these 'free services', please remember this discussion. Until then, may your faith be your saviour.

Rightly said. We either pay through cash or through personal data or in-device ads. Many years before when Hotmail wanted to charge for their e-mail services this could have been their logic and we all know how it ended.

All I'm saying is, instead of hunting the Users and Start-ups like Whatsapp, Telcos and TRAI may better spend their time on improving quality of services and collaborate with start-ups, Device Makers etc. to innovate.

Move from Landline to Mobile Phones happened pretty quickly and no one could stop it. Perhaps we are witnessing the next phase of it wherein Users are shifting from the Mobile Carriers to stand alone apps.

[audioholic]

Originally Posted by tsk1979

Its look like greed of Telcos is not just confined to the western world.
I already pay for 1GB data. What I transmit with that data should be my wish. Telco is nobody to say what kind of packets that 1GB can contain.

That's simple and straight forward.

As long as I am paying for the data they have no right to ask what I use it for. Plain stupidity shown by TRAI to save the falling number of SMS carried by the Indian TelCos. Either they should raise data costs, or look elsewhere. Now Airtel has already got a recharge which covers only WhatsApp data usage over a certain period. Now aren't the subscribers paying for using the service?

I guess its like chasing an unseen unheard animal. TRAI cant go behind apps that are floating in online stores. If they block or ban WhatsApp another app will follow. In a similar way, even WhatsApp cant charge customers so easily since there are always other options.

Hence I doubt such moves will work, unless all the TelCos get together and block WhatsApp or VOIP traffic. Still we have BSNL broadband as a backup

[saket77]

I do not use WhatsApp. Seldom send text messages through the SMS, however, a cost of Re. 1 per message for local ones and that of Rs. 1.20 for outstation ones is what I pay to my telco operator. I have in my mind that these charges are higher for SMS, so clearly, the telcos are not eyeing much money from messaging services, as many times calling is cheaper than sending messages.

The telcos know better that whatever revenues they are generating is due to voice or data services. They also better know that being a data carrier is the future. So, more than WhatsApp and other such messaging platforms, VOIP would hit them hard very soon. So, in my opinion, rather than making a hue & cry for messaging platforms, they should be preparing themselves to fight with VOIP platforms by the method they choose to. Else, soon we would be having a similar discussion about VOIP!

[Kumar R]

To the extent such a proposal was mooted on the justification that WhatsApp (and others) were a way to bypass existing norms it might make sense. But it seems to me that the case for taxing these Apps is that they are causing a "revenue loss" to the telcos. That's a business risk and one that the telcos should have have anticipated years in advance (if not decades) [Remember the bad old days of VSNL dial-up internet connections at 33.6 kbps when internet telephony was banned by the government].

If you recall, TRAI had earlier decided to stop roaming pacts between telcos on fears that those could be used by telcos to provide services in areas where they have no spectrum/license to operate. Assuming that was indeed the case it's an example of bypassing the law using some facility intended for a different purpose (a bit like benami transactions). In such case the regulator could intercede and plug a loophole to prevent misuse of a law.

On the other hand a revenue loss happens because the service provider could not forsee that users would prefer cheaper apps to more expensive SMS. The solution is to either get better leaders or raise data charges (or maybe both ). There is certainly no case for the regulator to intercede.

What's worrying is that the news reports cite TRAI using the second ground as a means of intervention. They have certainly not claimed that messaging apps are violating the law. Tomorrow if everyone shifts to email instead of using SMS, will they charge email service providers also??

[narayans80]

Originally Posted by Steeroid

Whatsapp is probably the biggest file-sharing application today.

So are email and tons of other file sharing sites. It would be a pointless exercise if TRAI is going to chase each and charge them. Moreover at the appalling 2G speeds we get in India there is very little you can do. If not Whatsapp there are tons of other apps that are already available to replace.

If TRAI ends up doing what is on the OP, they are not going end up in any financial benefits.

[sgiitk]

The meddling busybodies, always trying to fleece the aam admi. VOIP has alays been frowned at but accepted/tolerated, what has changed now?

[fine69]

Ok so I pay some toll for the road that I use but the highway authority is saying that if I go that specific dhaba to eat I would have to pay them additional toll. If I don't eat there and use the road then not. But on the bright side, I could go to the water park, which isn't as successful as the dhaba, and not pay anything beyond the toll.

Is this similar logic or am I missing something?

[bullrun87]

I really liked the first comment on the link . If if the telecom companies feel that social networking apps are stealing their revenue then I'm sure the humble postal department also felt the same way when cellphones and the internet started to come to the mainstream. I guess the post office should also start demanding money from the telcos and internet service providers .

[Thirugnnanam]

Once upon a time, people were using Gtalk extensively in mobiles to chat. And none (read telecos) took notice of it because it was a part of "internet service". People were charged according to their usage of it. Come Whatsapp, which virtually uses the same "internet service". People ARE charged according to the usage of it. In fact, it wont be out of place to say that Whatsapp has actually motivated a lot of people to use or subscribe to mobile internet packages (my dad being one of those people; he never used mobile internet before whatsapp came). Doesn't it mean that telecos are actually benefiting from the apps?

If whatsapp hadn't been sold to FB for $19 Billion, I don't think the telecos would be resorting to these kinda moves. They are seeing the business transactions, and think "hey, let us have a piece of that pie too".

Talking about this, is there anywhere in the world where whatsapp or messengers are charged by govt?

PS: I understand that the move is initiated by TRAI, but I feel this move won't have been initiated if not for the lobbying by telecos. Hence, directly taking telecos into picture.

[shankar.balan]

This miserable protectionist quasi socialistic country's policy makers should be shot. What gives them such a sense of entitlement?

The consumer should always be King and let the service providers compete in a free market for their custom!

[charanreddy]

This proposal is disgusting. It shows a regressive mindset that cannot deal with a dynamic world. Whether any body likes it or not, technological innovations that disrupt the status quo are going to be much more frequent.

Whats app, Viber and BBM are the way forward. As long as the usage is with in data plan limitations, the Govt or telephone company has no business taxing this. This will also lead to software developers coming up with the different variations of software like Whats app that will not be caught in the Govt's radar.

The carriers need to start thinking about revamping the long term pricing strategy, not create exceptions for the short term.

The above is like saying companies A,B & C has bought some 100 tons of cable for land line phones, but the invention of mobile phone has made it redundant the companies are now facing losses. The solution is not to discourage mobile phone usage or put a 'Landline loss covering tax'. The solution is to tell the companies to 'Suck it up and move on'.. this is going to happen far more frequently in the future.

[ajaypjayaraj]

Whatsapp, FB, etc. works on a new business model which doesn't work on pay as you use method. It's free for the end user but it is earning millions in the process. That is the future of business.

A small example. I purchased a HU from spandeal for 40K including shipping to my address. The same HU costed 52K in that (HU) maker's exclusive showroom in my place. Now no one needs to explain the reason. I know why it costed me less and that the exclusive dealer is helpless in that situation. But does that mean that the dealer will tax me for getting it cheaper else where just because his business model is not designed efficient enough to sell a product cheaper yet earn bigger profits? No, he cannot help it. Unless he has enough influence on the system to make a change in it and tax me.

When telcos work on their good old business model, they would naturally face challenges. They have to think of smarter solutions to the situation rather than taxing the users who get the benefit of some one else's better ideas.

They are screaming out loud that "we din't expect smarter ideas from other enterprises than what we had and we don't know what else to do with the business we set up, so let's pass the burden on to you"