OTT: Competing or Collaborating OTT in Indonesia Telecommunications Business Mastel: Sari Pan Pacific Hotel Jakarta 5 th

1. OTT: Competing or CollaboratingOTT in Indonesia Telecommunications BusinessMastel: Sari Pan Pacific HotelJakarta 5th December 2013 Dr John Ure Executive Director, Asia Internet Coalition http://www.asiainternetcoalition.org/ Director, TRP, University of Hong Kong, Director, TRPC, Singapore

3. OTT services popular due to • The popularity of smartphones and availability of free Wi-Fi hotspots which allow users to use OTT services for free • Unlimited messages, unlimited VoIP calls • Photo/video sharing, location sharing, contact information sharing • Social networking, games • Cost of phone calls, pay-per-view services, DVDs, etc.

4. Digital Paradigms Telecoms: from stand-alone To networked ICT economy New = demand-driven Broadband offered by new entrants Smart nets Apps/content everywhere UA demand 4 Internet Rural demand for content Digital dividend + OTT Digital economy • Old = supply-driven • PSTN as utility only offered by telcos • Dumb pipes • Few apps or content • UA poorly served supply • Little revenue generation • TVs before phones • Analogue economy

5. Digital Economy Transition from Analogue Transition to Digital Bundled packages of OTT as “value-added” Consumer market = WhatsApp, WeChat, Kakao Talk, Jego, GSMA’s Joyn, Fonetwish for access to FB profiles, etc. Enterprise market = unified comms platforms & managed networks; e.g. WebRTC • Basic metered service revenues down • Substitution of OTT for voice, SMS, video, IPTV • Dumb pipe rentals grow • Drivers include Internet, IPTV, etc. • ISP services leveraging telcos’ market power

6. Competing or Collaborating

7. Regulating Digital • Quality of Service • Danger of time warp? • Different approaches • VoIP and numbering, but GLS is already one answer • QoS is a service differentiator = leave to market • OTT voice-over-BB is better QoS than PSTN! • Protect or Promote? • Protect operators from disruption? • Protect/promote consumers’ choice? • Promote digital economy?

8. Conclusions • OTT is here to stay, it’s the most efficient use of communications resources • The nature of interconnectivity is to compete and to collaborate • OTT service providers can become carriers; carriers can become OTT service providers • Commercial viability will always determine the outcomes – markets and technologies will always be unpredictable and therefore risky investments • Promoting the digital economy rather than chilling out innovations of Internet businesses is the way for society to maximize the benefits of the digital age.

9. Please visit http://www.asiainternetcoalition.org/ • www.trpc.biz

10. Appendices • Examples of OTT services offered by telcos and Internet companies • Traffic management and net neutrality guide

12. Traffic Management and Net Neutrality: A Guide for regulators? • Where within the network are the network management tools applied? Typically management techniques are applied above the transport layer, if applied in transit between networks in routers below the transport layer = red flag! • What type of tool is applied: typically for short-term congestion causing delays < 1 min, network shaping and queuing tools are used; > 1 minute access control; if access control used to block or degrade = red flag! • Who decides which tool to apply: at request of the Internet source or unilateral decision of ISP = red flag! • When and on what basis is the tool applied? To (i) an app; (ii) source/destination; (iii) service provider; and/or (iv) payments processor – if basis is (ii) or only to traffic from (iii) = red flag! • Source: Scott Jordan and Arijit Gjosh (2009) http://www.ics.uci.edu/~sjordan/papers/tprc09.pdf