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Monday, June 01, 2015

WebRTC & Contextual Comms may help so-called "OTT" apps avoid regulation

Last week, the Belgian authorities tried to claim that Skype is a telecoms "operator" and should comply with a similar set of laws to fixed and mobile telcos, especially around data-retention and lawful interception.

The Indian regulator TRAI has been undertaking a consultation about whether so-called "OTTs" should be somehow "regulated". (TRAI's consultation document is one of the most woefully-written and factually incorrect pieces of official literature I've ever read).

Slightly different but in the same general domain, the UK Government is looking at ways to limit the use of encryption and anonymity with Internet communications services, again to collect metadata. (Sidenote: I think some of the proposals are rather technically ignorant and will get sidelines - and it's worth noting the UK remains one of a dwindling set of places without either official ID cards, nor a requirement to register SIM cards).

A major principle that keeps cropping up is that regulators, telcos and governments assert that services such as Skype and WhatsApp are somehow "equivalent" to traditional phone calls or SMS, and therefore should attract similar regulation.

This also intersects with another set of regulatory pushes (notably by Telefonica's increasingly shrill & incoherent policy team) to try to force interoperability onto 3rd-party communications apps. Sometimes calling it "platform neutrality" this seems to be a transparent attempt to reduce competition from new voice/video/messaging apps by dis-allowing "walled gardens". Given that the only likely medium for mass interop is the PSTN (and E.164 numbers), this is a blatantly defensive move to ensure the old phone network remains at the centre in future. It's unworkable, but unfortunately the current EU Commissioners seem more keen than their predecessors to try to implement stupid/unworkable ideas from the telco lobbyists.

Yet this is all very rearward-looking. The most successful future communications apps are not going to be yet more "free standalone messaging" services that look like SMS or WhatsApp, nor "cheap generic VoIP calling" ones that emulate Skype. 

Those ships have sailed already. It's another reason why most telcos' "IP communicator" apps will fail, especially if based on lower-than-lowest common denominators like RCS.

Instead, any new winners are going to be unique in some way - features like disappearing messages (SnapChat), blending realtime 2-way voice with asynchronous (eg Talko), embedded voice/video as a secondary feature in other social or business apps (probably with WebRTC), or with a strong contextual-comms element (using the user's physical status or intended purpose).

The interesting thing here is that not only would these be differentiated but it would also seem impossible, or at least much harder, to claim (note: I'm not a lawyer) that these are "equivalent to the phone service".

I also think existing services need to assert their "non-equivalence" much more vehemently - and point to the lack of innovation in telephony and SMS over decades. 

Regulators should not be accepting telcos' arguments that they need to cross-subsidise network investments with profits from over-priced, near-obsolete services.

In the Skype case, I'd say that one option Microsoft has in Belgium is to ditch the interconnection to the PSTN, and possibly move to a video-only model. Both would indicate that it is not a "phone service" but something entirely different. Given that there is no successful telco video-calling service (nor, with RCS & ViLTE as proposals, will there ever be) it would be much harder for the authorities to claim equivalence.

A more interesting defence of Skype's uniqueness could come from analysis of the proportion of calls preceded by a messaging session. In my view, the user experience of Skype is very different to the PSTN, as it is not based around unexpected, interruptive calls, but is instead an "escalation" method of rendezvous and arrangement. You use presence, chat with IM, and then say "OK for a call?". That is different to traditional comms experiences.
In fact, I'd argue that designing a new service to be too unique & differentiated to meaningfully interoperate with the PSTN or SMS means that:

a) It stands a chance of success, against 100s of "me too" apps and installed bases of 500m+ for entrenched competitors.
b) It will be harder to capture with pernicious regulations and telco lobbying, as it's clearly something new, and not just a cheaper substitute for protected legacy services.

Having given this a lot of thought, I've reached the following conclusions:
  • New communications apps SHOULD NOT interop with phone calls (like SkypeOut or iMessage) if at all possible. If they do, they risk being classified as "similar" to regulated services.
  • Avoid using E.164 phone numbers as identifiers as possible, for similar reasons
  • Ensure that user behaviour and features are very clearly distinct from traditional "calls" or SMS, to the degree that "interoperability" is meaningless
  • Concentrate on communications-as-a-feature rather than as a standalone service, unless it is a completely unique and differentiated format. WebRTC is the likely key enabler. (Click here for my research report)
  • Create "clear blue water" between legacy phone-calls / messages by using contextual communications capabilities that cannot be replicated in traditional telco service. Focus on how, and why a specific instance is occurring, and use external data to help reach the desired outcome.
  • Where there is a specific business need for interop, avoid using 3GPP/telco standards wherever possible (SMS, SS7, IMS, RCS) and use the web or proprietary mechanisms instead.

As a reminder, I'm running a workshop on Contextual Communications on June 15th in London, along with Martin Geddes. Sign up here.


Anonymous said...

Good piece. Small point though: while iMessage (and FaceTime) use phone numbers as identifiers, they do not interoperate with the PSTN.

Google Hangouts does, I believe, however.

Aswath said...

This may come across as nit picking and argumentative. But I would like to point out that it is possible to do contextual communication in some PSTN calls. For example, for mobile to mobile calls, it can be carried in the User-to-user information element of the SETUP message. What is lacking is the UI to compose that info or to access it and a way to dispose the call based on that.


Dean Bubley said...

Anonymous - Good point, thanks

Aswath - interesting. Has anyone done anything with it? Is it universally implemented in PSTN & mobile?