OTT : un marché en forte croissance qui devient un candidat naturel pour la régulation

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OTT market characteristics raise regulatory concerns

The Internet services (often referred to as OTT) competitive landscape is clearly dominated by a handful of players with a worldwide approach. They clearly have a dominant position in data-based markets like search, ecommerce, cloud, social networks, online advertising, etc…

This obviously raises regulation concerns in terms of competition, around the platform model, and in terms of privacy, due to the intensive use of data. The international nature of OTT players also comes under the spotlight in regard to taxation issues, as for big corporations in other industries, reinforced by the digital nature of the activities. Finally, as telcos are often quite vocal about OTTs, key regulatory concerns also include the issue of the level playing field between different types of digital players and Net Neutrality to ensure a relevant framework for the Internet.

Europe stands out for OTT regulation, with a common framework but also diverging opinions

Regulators, sectoral and transversal (ie competition authorities), are taking the topic of OTT more seriously in general and especially in Europe, as illustrated by the fine for Google Shopping, Apple tax in Ireland or the numerous actions in the collaborative economy space. But the regulators also have to find the right balance to avoid stifling innovation.

Compared to the rest of the world, OTT regulation is fairly advanced in Europe and subject to a very different approach in Africa and Middle East. Indeed, in the latter region, OTT services are often simply banned to protect local services (like OTT communication services). Europe itself is setting potential global standards with the GDPR addressing data regulations and is at the forefront on platform assessment.

Without necessarily being the clear leader, Europe has also made some major moves around Net Neutrality and taxation (based on country of consumption rather than country of origin for ecommerce). But within Europe there are large discrepancies, with very different positions depending on the topics. While France, Germany and Italy are generally seeking hard rules; the UK is taking a more pragmatic approach, often open to the market. The Netherlands is probably the most pro-OTT country in Europe with hard Net Neutrality rules and a tax-friendly approach (Hong Kong is very Similar).

The rest of the world is less advanced

The situation in the Americas and Asia-Pacific is less advanced on the whole. Canada and India (plus to a lesser extent Japan) appear as the countries with the toughest existing or upcoming regulations. Other countries are definitely trailing (Brazil still investigating privacy rules for instance).

Finally, the USA stands out, evolving within its own advanced framework, which can be quite tough on regulations (pioneer in Net Neutrality, privacy through multiple laws, taxation for US citizens). But this framework is often softened and counterbalanced by US authorities to avoid too much impact on the key platforms, mostly US-based players.