Instant messaging rules needed after $ 33 bn loss?

Apparently phone carriers lost $ 33 bn due to instant messaging apps and after Facebook’s acquisition of WhatsApp, telecom companies are calling for stringent instant messaging rules, but how are they currently regulated?

Within the European Union, the main issue is whether instant messaging apps are either a mere “software” and therefore are not subject to specific rules or fall under communications regulations which define “electronic communications services” (ECS) as:

  1. a service normally provided for remuneration;
  2. which consists wholly or mainly in the conveyance of signals on electronic communications networks, including telecommunications services and transmission services in networks used for broadcasting;
  3. but excludes services providing, or exercising editorial control over, content transmitted using electronic communications networks and services and information society services which do not consist wholly or mainly in the conveyance of signals on electronic communications networks.
The applicability of the above mentioned regime obliges, among others, to submit a prior notification (the so called “general authorization“) to the competent communications authority which will monitor and regulate its activity and pay a fee that in the case of ECS is usually quite low. Also the ECS shall comply with interception and information requests issued by the competent judicial authorities and such obligation has been subject of considerable discussions over the years also because the compliance with such requests represents a major cost for companies. 
In this respect, it is also relevant to understand in which cases local communications authority have jurisdiction on foreign instant messaging providers. Is the mere fact that a local user can perform a communication through the app extending the jurisdiction of local communications and police authorities to the foreign company managing the app? 
Finally, what happens if voice calls are added to the App and it is given also the possibility to call and receive calls from telephone numbers? The risk derives from the qualification as “publicly available telephone service” which triggers a more stringent regime. 
The scenario is still uncertain and regulators might take a position on the matter as they already did with reference to data protection issues for mobile apps. In the meantime, feel free to contact me, Giulio Coraggio ([email protected]) to discuss, and as usual follow me on my Facebook pageTwitter and Google+ and become one of my friends on LinkedIn. 

Image courtesy of Flickr by Rick Anderson 

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Giulio Coraggio

I am the head of the Italian Technology sector and the global head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our clients' success.

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