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Telecom Operators Ready to Fight WhatsApp

Posted on the 15 September 2015 by Angelicolaw @AngelicoLaw

For decades, the term “telecommunications” referred to one form of communication: the telephone. Advances in technology, however, have led to voice communications via the Internet. Now, telecom companies in Brazil claim that some of these new communications services have an unfair economic and legal advantage under the current laws in Brazil. They argue that these new communications services should also be governed by traditional telecom regulations.

Three separate but unnamed sources from Brazilian telecoms told Reuters that the telecom companies are working on a report focusing on the voice communications service of the popular messaging application WhatsApp. Traditional phone companies pay taxes on mobile telephone lines because each line is given its own number by government regulators. The phone companies want WhatsApp to pay these taxes as well.

The telecom industry is focusing on the voice communications capability of WhatsApp as opposed to its messaging capabilities. Unlike some voice over internet providers that allow users to communicate based on a username, WhatsApp works based on a user’s mobile telephone number.

In an interview with O Estado de S. Paulo, Telefônica Brasil’s CEO Amos Genish called WhatsApp “a pirate operator.” According to Reuters, Genish also said that the company planned to challenge WhatsApp’s ability to offer Internet voice calling in Brazil. While he gave no other details on what the telecom operator would do, one source told Reuters that at least one of the telecom companies plans to file a lawsuit against WhatsApp.

The telecom companies appear to be trying to quash the new competition by goading the government to impose the same regulatory requirements faced by the telecom industry on voice communications services like WhatsApp. However, it is still unclear exactly how Brazilian telecom laws would apply to these newer services.

Not surprisingly, consumer groups are unsympathetic toward the telecom operators’ case. They argue that, unlike traditional telephone services, WhatsApp uses the Internet and not a telephone line. Hence, they should not have to pay a tax meant to be imposed on telephone lines.

If the telecom operators hope to be successful, they will need to be convincing in their argument that subjecting more companies to regulation is also a good deal for consumers. A look at the other Internet-enabled services now widely available to consumers shows that it will be a tough case to make.

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