Thoughts on VAS Guideline

1. Thoughts on VAS Guideline Corporate Affairs

2. Introduction and GP’s position on way forward of CP/AD guideline • CP/AD Guideline was drafted in Q3 2011 in consultation with CP/VAS service provider • The intension is to issue License for CP/AD & identify the VAS services which will be eliminated from the MNO’s service • The VAS service definition is as per this draft: apart from the basic voice and FAX all are VAS • Definition of VAS excludes – Basic voice, SMS, MMS, internet and other services which are logical.

3. From our internal study we realized… • Logic has been developed to include sixty percent foreign investment for Licensing eligibility • Our position has been clarified on interconnection and short code areas. • Intellectual property right of the sourced content is very important. Thus, a number of conditions has prepared to protect all parties’ interest. • Customer experience after sales of the content is very important, thus, the responsibility of performing the customer service has been developed. • MNOs position in the area of billing has been prepared. • From the practical point of view, the conditions and logics has been prepared for revenue sharing for the MNOs… more logics are being sourced from different international Operators’.

4. Objective of the VAS guideline To issue VAS License which will capture the service currently CPs/ Aggregators are offering. The VAS is defined all services excluding voice call and Fax transmission MNOs existing VAS needs to be migrated to VAS Licensee What about MNOs? The MNOs should, by default, become content providers. Due to the nature and source of some contents, they become properties of the MNOs. Some of them are part of the branding activities of the MNOs. Moreover, MNOs have better capability of international sourcing and spontaneous sourcing of some specific contents (sports/news update) value of which would go down if another party gets involved. Hence, for availability of better service for a competitive price for the subscriber, MNOs should be allowed to provide content services. What would be the edge for the VAS Licensees ? Although the MNOs shall be allowed to provide contents, the content providers shall be given the rights to provide some types of contents exclusively. A list of such types should be provided.

5. Eligibility – clause 7 We are a country in need of foreign investment. Content service can be a potential export business for a country like Bangladesh. One of the ways of promoting this is allowing foreign investors to invest in this industry. BTRC disqualifying foreign entities to be shareholder/partner of such business conflicts with the national policy of promoting foreign investment in Bangladesh. There can be a requirement of having at least 40% local shareholding. Interconnection – clause 8 CP/ADs should be allowed to directly interconnect with the MNOs or via ICX. Regarding cost liability of the parties, there should be provisions precise or leaving it on mutual agreement that does not jeopardize the business case for the MNOs. Short Code – clause 8 For business need, multiple short codes might be required by some CPs. This shall also facilitate buy/sale of severable services. Short codes should also be transferrable which shall make the services smoother and the business more valuable. So the provision should be: The CP/AD will be given short codes from the Commission as per their business need which shall be accessible by all the subscribers of different PLMN/PSTN operators (open-access model). Short codes can only be transferred to a Licensed CP/AD or to a MNO with approval of the Commission.

6. Responsibilities Whoever shall offer a content (MNO or CP) shall have to ensure that the content right is secured and thus no violation of IPR of any entity. If one CP establishes a platform to be availed by multiple CPs (may include MNOs), it is the beneficiaries of the platform who shall, as the original CP, ensure the IPR procurement. Intellectual Property Rights • We need to ensure that all different types of contents/applications are available for the consumer. The guideline should ensure that: • For applications hosted by the CP/AD, the CP/AD shall procure all the intellectual property rights in the application from the application developer. • For locally procured audio-visual contents hosted by the CP/AD, CP/AD shall procure the intellectual property right to use the content as mobile phone content. . For audio-visual content procured from foreign entities and hosted by CP/AD, CP/AD shall procure the intellectual property right to use the content as mobile phone content • For application based services such as e-mail, social network or browser based services, the intellectual property rights shall be handled as per agreements between an MNO and the service provider. (logic) • For contents of instantaneous nature, such as news service, the contents shall be directly hosted by the service provider through their own agent to the MNOs. The intellectual property rights shall lie with the news service provider. (logic) • For applications and audio visual contents developed by the MNO or developed under any campaign/activity/research/sponsorship of the MNO, the MNO shall be eligible to host the application or audio visual content on its own content platform or through an aggregator. Intellectual property right of such contents shall be decided as per agreement between the MNO and the developer/artists. (logic)

7. Customer Experience If, after sales services for the contents provided by the Content Providers are to be dealt by the MNOs, this would not be a viable model as the MNOs shall not have any control on the quality of the product and IPR of the content in question. MNO handling a complaint regarding content shall linger the process and cost the subscriber additional time and money. This shall also hamper the service quality of the MNOs and shall also affect the tariff of the network to recover the cost. The CPs should be obliged to set up their own call centre and publish the number (this could be the same short code used by them along with their advert. The quality of service should be the same as the quality of service of MNOs complaint management. While engaging the CPs we may bring up the issue that BTRC has the target to make all the customer service calls free. Would they be able to sustain that?  Billing - clause 8 It is very important that the parties agree to the common fields for reconciliation for transparency. So, the clause should be: Network/Solution/Platform Provider and CP/ AD will maintain the billing system in a fashion that reconciliation/reimbursement of revenue with CP/AD are done in a transparent manner as acceptable by the Commission. Network Providers and CP/AD shall bilaterally decide on which fields should be kept on management information system for reconciliation.

8. Revenue – clause 8 We have considered two different methods of revenue sharing between MNOs and CPs for multimedia and application contents. • Revenue Sharing: In this model the CP and MNO share an agreed portion of the revenue earned from the subscriber while selling the right to use the content in their device. The MNO shares a portion of the revenue for facilitating the download/installation. • Wholesale: In this model CPs buy wholesale data/transfer package from the MNOs for transferring of the data and thus no revenue is shared. CP bears the risk of investing in advance for services they may not use. However, future revenue from data transfer of playing the content (welcome tune) on MNOs system shall not generate any revenue for the CP.  • Future revenue from data transfer of playing the content (welcome tune) on MNOs system shall not generate any revenue for the CP: Why? • The CP shall only provide the content and the intellectual property right to enjoy the content on a specific device and network. However, once the right is purchased, the MNO has to provide the infrastructure and/or data service to allow the subscriber to enjoy the content. This shall not apply to contents which do not require any ongoing support/data e.g. image, songs downloaded as MP3, games downloaded and played without any data transfer. • One option for CPs to generate revenue can be forging the content with expiry date. That way subscriber may have to renew subscription of the IPR periodically and MNOs can charge the CP following one of the methods mentioned above.