WhatsApp, Facebook Messenger, Telegram etc. might have to pay for their usage of telecom networks as their services can be substitutable of traditional telecom services.

I had discussed last year about the investigation launched by the Italian communications authority on “social apps” where it is made reference to “consumer communication services” that allow the real time exchange of voice, text, photo and video contents such as WhatsApp, Facebook Messenger, Skype, Telegram, WeChat and Viber. The discussions about these apps derive from the reduction to the usage of traditional telecom services as a consequence of their growth which led to major complaints.

Following such investigation the Authority has now issued its opinion on the matter whose main findings are the following:

Social apps are NOT currently regulated

The current definition of “electronic communications services” (ECS) does not include for the time being social apps as according to the Authority such services are not responsible to carry the signal on communications networks. Therefore social apps are NOT currently subject to the framework of regulations relating to the communications sector.

But, given the technological development of the last years, it might be necessary to amend the definition of ECS to include social apps. According to the Authority, this is due especially because with reference to instant messaging applications which are deemed by consumers substitutable of traditional SMS.

Shall WhatsApp, Messenger and Skype be regulated?

The Authority is of the opinion that the regulatory barriers for telecom providers are currently considerably higher than those applicable to providers of social apps that use communications network to provide their services without dealing with regulatory obligations. On the contrary, social apps providers face considerable technical barriers since the different apps are not interoperable because users of an app cannot communicate with users of the other, with the consequence that new entrants in the market might find a disincentive to the entrance in the market.

The extension to social apps of the same rules applicable to communications operators might lead to a delay in the technological development and in any case the latter are remunerated by their users who pay for data connection services.

The need of ad hoc regulations shall be monitored to assess whether the market itself can solve the current distortions.

What are the regulatory options?

The Authority considers to adopt the following possible measures:

  1. Measures enabling the Authority to ask information to providers of social apps and in general to all the over the top (OTT) -> this would be a right that can be enforced not only towards ECS, but all the OTTs;
  2. Measures relating to the interconnection for data transports and interoperability -> the option is the provide an “obligation to negotiate” between network operators and OTTs as to the modalities of data transport and pricing in order to make sure that the former are remunerated by OTTs for the usage of their network. This obligation might be coupled with an obligation on social apps to ensure their interoperability i.e. the possibility to communicate between users of different social apps;
  3. Measures requiring authorizations for the usage of the service and for the exploitation of numbering resources -> these measures might create a barrier to the entrance in the market and therefore the impact on competition shall be carefully assessed;
  4. Measures aimed at protecting social apps users -> telecom specific obligations are imposed on providers of ECS when it comes to transparency of contractual terms and of obligations, while no similar obligations are imposed on providers of social apps byb sector specific rules.

The conclusions of the Authority

The Authority is of the opinion that the current definition of ECS is obsolete and shall be replaced by a broader definition able to include also social apps. This is because the distortions in the market might not be sorted by the market dynamics themselves.

The new definition of ECS shall be flexible and assess on a case by case basis whether the new services can be considered substitutable of traditional telecom services.

Once social app are regulated the minimum measures to be adopted will relate to transparency obligations towards users and the provision of emergency numbers, but different options are available to regulators.