South African Telecoms Demand OTT Services Contribute to Network Costs
According to Developing Telecoms, South Africa’s Association of Communications and Technology (ACT), a body representing telecom giants such as MTN, Vodacom, and Telkom, is calling for over-the-top (OTT) platforms like Netflix, YouTube, and WhatsApp to financially contribute to the cost of maintaining and upgrading network infrastructure. This push highlights a growing global debate about whether content providers should share the financial burden of telecom infrastructure investments.
Telecom Operators Push for a ‘Fair Share’ Framework
The ACT argues that OTT platforms place immense pressure on network bandwidth by delivering high-bandwidth services such as video streaming and real-time messaging, yet these platforms are not regulated nor required to invest in infrastructure. ACT CEO Nomvuyiso Batyi emphasized that the ongoing expansion of 5G and other next-generation services necessitates consistent network upgrades, a cost that telecom operators are struggling to shoulder alone.
To address this imbalance, the ACT proposes a new regulatory framework under South Africa’s Electronic Communications Act that would compel OTT providers to share the financial load of maintaining network infrastructure. While most ACT members, including MTN and Vodacom, support regulatory intervention, Cell C has indicated a preference for “constructive engagement” over mandated solutions.
Global Context: A Common Struggle in Telecom Markets
The issue of OTT providers not contributing to network costs is far from unique to South Africa. Telecom operators worldwide, from Europe to India, have raised similar concerns. For instance, the Cellular Operators Association of India (COAI) has repeatedly called for regulatory mechanisms to ensure that OTT platforms contribute financially to network development. Similarly, in Europe, discussions about a “fair share” contribution intensified in 2023 as operators warned that their profitability—and thus their ability to invest in infrastructure—was at risk.
In developing markets like South Africa, this issue is even more pressing due to limited financial resources for infrastructure expansion. The rollout of 5G services, along with increasing consumer demand for high-speed internet and data-intensive applications, has significantly increased network investment needs. According to a Statista report, global telecom infrastructure spending is expected to grow by 5.8% annually, driven primarily by the adoption of advanced network tiers.
What This Means for the Future of OTT Providers and Telecoms
From an industry perspective, a shift towards regulatory frameworks requiring OTT providers to pay into infrastructure development could create ripple effects across the digital economy. Passing these costs to lightly regulated tech giants may spur innovation and collaboration, but it may also lead to higher service fees for consumers. Industry analysts believe that such measures could incentivize stronger partnerships between telecom operators and OTT businesses, potentially leading to bundled service offerings or shared revenue models.
Furthermore, with 5G adoption accelerating, telecom operators are under pressure to resolve this funding issue quickly. According to Deloitte’s 2025 telecom forecast, global 5G-enabled connections could surpass two billion by the middle of the decade, further underscoring the importance of sustainable infrastructure financing.
The ACT’s proposal could also inspire similar debates in neighboring regions, particularly in Africa’s developing telecom markets, where infrastructure disparity remains a major barrier to digital connectivity. However, critics caution that imposing additional costs on OTT services might stifle innovation or limit the affordability of streaming and messaging services for consumers in price-sensitive emerging markets.
What Do You Think?
South Africa’s demand for OTT contributions could represent a pivotal moment for the global telecom industry. Should streaming giants like Netflix and YouTube help shoulder network costs, or does this responsibility solely belong to telecom operators? Share your thoughts in the comments below!
