The European Union is poised to extend telecom rules to over-the-top (OTT) web providers, such as Microsoft's Skype and Facebook's WhatsApp, in an effort to level the regulatory arena.
According to an internal European Commission document obtained by The Wall Street Journal, the European Commission's executive body plans to require Internet communications companies to implement stricter security and privacy protections, as well as make it easier for customers to move their information when they switch to other services.
The new rule proposals would more closely align Internet-based companies that provide free calling and messaging services with the same regulations that govern traditional telecom service providers such as Orange (NYSE: FTE)
and Telefónica .
Telecom companies have taken issue with companies such as Google (Nasdaq: GOOG), Facebook and Microsoft Corp. (Nasdaq: MSFT) having less regulatory scrutiny despite offering similar services, according to a story by Reuters. They're also able to cash in on the use of their subscribers' data.
The Wall Street Journal noted that traditional telecom companies have groused about making expensive investments to their networks while web providers are able to ride along on those networks to provide services such as WhatsApp or Google Hangouts for free.
In addition to the privacy requirements, the European Commission is reportedly mulling new financial obligations for OTT service providers, as well as administrative charges when they connect with traditional telephone numbers, according to The Wall Street Journal.
The European Commission is expected to update its telecom rules this fall.
— Mike Robuck, Editor, Telco Transformation