As a small country with a large diaspora, Trinidad and Tobago has been a rapid adopter of voice over internet protocol (VoIP) to communicate with overseas friends and family. VoIP is just one form of over-the-top (OTT) content that includes audio, video or other media delivered over the internet without involvement from the network operator. One of the first OTT companies to make a major impact on the market was Skype, which popularised VoIP audio and video calls and was acquired by Microsoft in 2011 for $8.5bn. Since then other companies have entered the OTT messaging and calls market, including WhatsApp, Viber and Apple’s FaceTime. In the home entertainment space, Spotify provides online music, Netflix streams movies direct to TV, and Amazon and Apple have launched their own online television companies. However, the popularity of these services threatens the revenues of the companies who set up the networks on which OTT content relies. “Recent discussions in the telecoms industry revolve around the overlap of what is traditionally considered to be OTT solutions and telecoms operators,” Ronald Walcott, CEO of Telecommunications Services of T&T (TSTT), told OBG. “The operators invest billions of dollars to build networks that OTTs use to transport their content for free, which has led operators to regulate the bandwidth speed and hence limit the capabilities of OTTs. There needs to be a more mutually beneficial model of interaction going forward.”

Global Complaint 

Discussions about OTT in T&T mirror those playing out on the global stage. London-based telecommunications research firm Ovum estimated that in 2016 VoIP calls will cost global telecoms companies $52bn in lost revenues from mobile voice calls, equivalent to 3.5% of global voice revenues. By 2020 these figures are forecast to grow, resulting in total annual losses of $71bn, or 9% of voice call revenues. Across the globe revenues from voice calls have been falling for a number of years, but the shortfall has been more than compensated by the rapid rise in sales of data plans. T&T is no different.


According to the latest data from the Telecommunications Authority of T&T (TATT), the industry regulator, total gross revenues from mobile voice calls fell from a peak of TT$2.3bn ($354.2m) in 2013 to TT$1.99bn ($306.5m) in 2015. However, revenues from mobile internet shot up from TT$102.7m ($15.8m) in 2010 to TT$578.6m ($89.1m) in 2015. “We have seen that while domestic fixed voice revenues have slightly fallen over the years, revenues generated from mobile internet services have increased significantly,” Annie Baldeo, executive officer of policy, planning and market economics at TATT, told OBG. “This is evidence that people are becoming more data-centric, leading to higher demand for mobile data services.”

It is not only the telecoms companies whose market share is being pressured by OTT content; Netflix, Amazon Fire TV and Apple TV offer on-demand streaming TV series and movies to residences with broadband. “Until two years ago there was a widespread belief that the main driver of broadband would have been mobile data,” Walcott told OBG. “However, we now see that residential customers demand higher broadband speeds, primarily led by on-demand services and other OTT solutions.”


The growing popularity of broadband in the living room poses a dilemma for pay TV providers. Android TV boxes mirror set-top boxes and allow users to download applications from the Google Play online store, but they also scan for streaming sites and are configured to pick up TV channels from across the globe. “These boxes are illegal on two accounts. First, they are often unfairly registered as computer equipment, meaning they previously paid no import duties or value-added tax, and do not require a receiver licence from TATT. Second, the boxes violate intellectual property laws by accessing the television signals,” Bernard Pantin, general manager of DirecTV T&T, told OBG.

In July 2014 Caribbean mobile operator Digicel blocked several VoIP services in Haiti and Jamaica and threatened to do the same in the T&T market. According to Digicel representatives, the firm had seen a 40% drop in international calls between January 2014 and June 2015. Digicel retracted its decision after TATT agreed to investigate the firm’s complaint about the use of number-based VoIP applications in the country. Since then the issue of finding agreement between mobile operators and OTT content providers has been a central issue of the T&T telecoms industry.

Talk It Over

In June 2015 TATT published a report titled “Towards the Treatment of Over-the-Top (OTT) Services”, and in the same month the regulator’s annual ICT Open Forum focused on the question “Should OTT Services be Regulated?”. According to Baldeo, the paper received over 150 pages of comments from users and providers on this highly contentious issue of OTT.

“The main concern raised by the mobile operators is that they are not operating on a level regulatory playing field with OTT service providers,” Baldeo told OBG. “According to the Telecommunications Act, firms providing public telecommunications services need a concession in order to provide such services in T&T. That requires the establishment of a local presence, substantial investment in infrastructure and the payment of taxes. The mobile operators ask ‘why do we have to adhere to these rules and the OTT service companies, who use our infrastructure, don’t?’”. Although the original scope of TATT’s report was focussed primarily on the VoIP market, it has since been expanded to include all OTT content. The regulator was reviewing the comments on the paper as of April 2016, in preparation for making policy recommendations to the government, with a final decision on the matter expected before the end of 2016. The global aspect of the OTT issue will not be overlooked, and for many in the industry the decision cannot come soon enough. “Although TATT has made positive strides in recent years, a lot of our telecoms regulation remains weak,” Pantin told OBG. “TATT has been working on the OTT policy for two years, the time for its implementation is now.”

A full integration of OTT services in T&T might require time, especially given the digital divide that still needs to be bridged, even in TV content. “I expect a larger scale implementation of OTT services to happen in the next two to three years, once the necessary infrastructure is built to bring 4G LTE and fibre to all households. In addition, OTT subscriptions often require a credit card payment line and T&T has still a relatively low level of credit card penetration,” Garvin Medera, CEO of Digicel Play – Digicel’s fibre and TV service – told OBG.

Potential Solutions

While the industry waits for a decision from TATT, telecoms companies will have to develop their own strategies in the face of the growth of OTT services. It is unlikely that the mobile operators will repeat Digicel’s July 2014 position and look to block VoIP and messaging services, given how unpopular such a move would be with their clients. Potentially, operators could look to profit on the back of OTT’s popularity by allowing their usage only on premium data plans. On the fixed-line and broadband segment, Brian Collins, managing director of Cable and Wireless Communications (CWC), told OBG that “In temporary absence of further regulation, price differentiation might be the most effective tool to put a cap on excessive broadband uptake while generating more revenue. Internet services providers might switch towards using pre-paid pricing packages, in a similar fashion to what is done in the mobile segment”.

Another likely response is for operators to find ways to work collaboratively with OTT providers to boost their own data revenues. In March 2015 TSTT signed a deal with YuppTV, the world’s largest OTT player for South Asian content. Under the deal, YuppTV will provide TSTT customers with access to Bollywood music and film over their broadband connection. Rakesh Goswami, executive vice-president of strategic alliance, enterprise and Tobago operations for TSTT, told OBG “We are working with YuppTV, supporting them 100% and promoting their product. For us it means increased bandwidth usage. OTT is already here and we need to make sure we get our share of the benefits”.

The debate on the extent to which OTT services should be regulated looks set to gather momentum, and decisions taken in the US and EU may influence TATT’s eventual policy. However, the rise in popularity of OTT content means that global telecoms companies are likely to embrace partnerships with OTT firms to look for new ways to increase data usage.