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Whatsappening? Telcos call out tech companies over business SMSes

By using WhatsApp and other unregulated platforms to send enterprise messages to customers, an industry group representing India’s top three Telcos has accused global consumer technology majors like Microsoft and Amazon of “presumably circumventing and bypassing the legal telecom route” and likely costing the Centre and the service providers Rs 3,000 crore in lost revenue annually. The Cellular Operators’ Association of India (COAI) wrote a letter to telecom secretary Neeraj Mittal stating that “renowned international corporates such as Amazon and Microsoft are presumably circumventing and bypassing the legal telecom route by disseminating messages to Indian customers via WhatsApp, Telegram.”

“This clearly represents a loss of revenue for the exchequer as well as a loss of forex earnings, in addition to the alleged flagrant violation of licensing and security norms.” In addition, the letter urged the Centre to “declare WhatsApp/Telegram as an illegitimate route for such (enterprise) communication,” citing the necessity of time-barred one-time authentication passwords for device access and transaction confirmation.

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SMS Service Provided by Telcos:

Fortune 500 firms employ international A2P (application to person) channels like WhatsApp to reach out to their clients for promotions and verification using OTPs. These organisations include the technology giants, OTT platforms, some banking institutions, and e-commerce sites. The trade association stated that these kinds of uses are intended for the regulated SMS service provided by Telcos.

According to a recent Frost and Sulivan research, India’s Telcos’ enterprise messaging business was worth little under Rs 2,500 crore in FY23. If business messaging shifts to platforms like WhatsApp, which is becoming more and more relevant given the explosive growth of digital payments and e-commerce volumes, Telcos may lose some of this revenue.

Managing Director Gopal Vittal brought up this practice and emphasized the need for uniform laws for various technologies providing the same service—in this case, Telcos and OTT communications platforms—during Bharti Airtel’s fiscal second-quarter earnings call.

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