REGULATION OF OTT CONTENT: CHALLENGES AND WAY FORWARD

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Picture Courtesy:   BUSINESS-STANDARD 

Context

The Minister of Information and Broadcasting informed the Lok Sabha about the steps taken for Over-the-Top (OTT) platforms regulation.

What are OTT Platforms?  

They Provide video, audio, and other media content directly to viewers via the Internet.

OTT platforms store pre-recorded content and deliver it via a Content Delivery Network (CDN). When a user selects a video, the platform retrieves it from a nearby CDN server and streams it.

Global OTT market size is projected to reach $1,039.03 billion by 2027.

COVID-19 pandemic and lockdown accelerated the Indian OTT Revolution.  

Key factors fueling this expansion include:

Affordable Data & Internet Penetration: Access to low-cost mobile data and increasing internet penetration drives OTT consumption.

• As of June 2024, Internet connections increased to 96.96 crore.

Smartphone Usage: Among the age group 15-29 years, approximately 97.1% persons have a mobile phone (including smartphones).

Shift in Consumer Behavior: Prefer on-demand content over fixed-schedule traditional television, offer diverse content in multiple languages.

• Indian OTT market had over 547 million users in 2022.
• Market value exceeded $1.5 billion in 2022 and is expected to reach $12.5 billion by 2030. 
• OTT (over the top) penetration in India stood at 38.4%.

Growing Competition: Rivalry among both global and local OTT providers fuels innovation and content diversification. 

Current Regulatory Framework for Regulation of OTT Platform

Pre-2021, India lacked specific legislation for OTT content, which largely operated under a self-regulatory model.

The Ministry of Information and Broadcasting (MIB) introduced the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (IT Rules, 2021), framed under Section 87(2) of the Information Technology Act, 2000.

Established a three-tier regulatory mechanism:

1. Level 1: Self-Regulation by OTT Platforms: Each platform must appoint a India-based Grievance Officer and implement a grievance redressal mechanism. The officer must address grievances within 15 days
2. Level 2: Self-Regulatory Body: An independent body, headed by a retired judge or eminent person, oversees compliance to Code of Ethics.  
3. Level 3: Oversight Mechanism by the Government: Ministry of Information and Broadcasting intervene and issue directives, with an Inter-Departmental Committee to hear appeals and complaints.

The rules mandate age-based content classification (U, U/A 7+, U/A 13+, U/A 16+, and A), parental locks, and content descriptors.

OTT platforms must inform the MIB about their entity details and publish monthly compliance reports detailing grievances and actions taken.

• February 2025, I&B Ministry's advisory, strict age-based content classification as per IT Rules, 2021, and implement parental controls and age verification for mature content.
• Released advisories to OTT platforms, ensure compliance to Indecent Representation of Women Act,1986; forbids the indecent portrayal of women in media.

Digital Publisher Content Grievances Council (DPCGC), independent self-regulatory body established under the Internet and Mobile Association of India (IAMAI) handle grievances related to online content provided by its member platforms. 

Major Challenges in Regulation of OTT

Creative Freedom vs Regulation: Article 19(1)(a) of the Constitution protects freedom of speech and expression, but Article 19(2) allows for reasonable restrictions.

• The safe harbour rule, under Section 79 of the IT Act, 2000, provides legal protection to online intermediaries (like social media platforms, e-commerce sites) from liability for third-party content hosted on their platforms, provided they meet certain conditions.

Ambiguous Content Guidelines: IT Rules use terms like "offensive" and "objectionable" to define prohibited content. This lack of clear standards creates uncertainty for content creators and can lead to arbitrary content takedowns or legal actions.

Jurisdictional Complexities: OTT platforms operate internationally, presents obstacle to regulating content created outside India but consumed domestically. 

Technological Evolution and Regulatory Lag: Fast pace of technological advancement, including AI and new content delivery methods, outpace regulatory frameworks.

Market Dominance and Competition: Few dominant global players like Netflix and Amazon Prime Video command large market share, concerns about fair competition.

Regulatory Ambiguity:  MIB sees OTT as part of broadcasting, while MeitY focus on regulating it as digital media.

• OTT platforms operate "over the top" of existing internet infrastructure, do not require Unified Access Service License (UASL), granted by the Department of Telecommunications (DoT) for providing access services like voice and data communication. 

Way Forward to balance regulation for OTT platforms

Dedicated legal framework: Adopt a new comprehensive legal framework for digital media rather than amending existing IT Act.  

• Lawmakers should focus on developing clear guidelines that respect artistic freedom and are not subject to arbitrary interpretation or Social/political pressure.

Strengthen self-regulation: OTT platforms must enhance their internal content review processes.  

• Implement clear content ratings.
• OTT platforms should follow ethical guidelines for content creators provided by the Internet and Mobile Association of India (IAMAI).
• Establish three-tier system grievance mechanisms self-regulation by platforms, self-regulation by industry-level bodies; and oversight by the Ministry of Information and Broadcasting (I&B). 

Government-industry collaboration: Policymakers and stakeholders, including the government, OTT players, and industry bodies, should engage in regular dialogue to balance the interests of all parties.

Public awareness and digital literacy: About platform tools like parental controls and content filters.  

Data privacy and security: OTT platforms must ensure data privacy and security standards, transparent data collection and processing procedures.

Market-oriented approach: A light-touch, market-oriented approach is favored to encourage innovation and growth in the OTT sector.

Taxation: OTT platforms, like other business entities, should be subject to tax rule, even if they lack a physical presence in India. Bangladesh, for example, requires international OTTs like Facebook and Google to register for VAT. 

Conclusion

India's OTT content regulation requires a comprehensive, collaborative approach to balance creative freedom with societal values, addressing issues like ambiguous definitions and jurisdictional complexities, to encourage a digital media ecosystem that respects constitutional freedoms and public safety. 

Source: PIB