In order to regulate online content, Pakistan Electronic Media Regulatory Authority (PEMRA) has issued a draft proposal titled “Consultation on Regulating Web TV and Over the Top TV (OTT) Content Services”.
The draft was issued on January 8th, 2020. PEMRA had initially sought comments by January 31, but the last date has now been extended to February 14.
PEMRA has noted that Web TV and Over the Top TV (OTT) has seen a tremendous growth in the past few years. While Web TV is there for quite some time as an alternate medium for streaming content such as news etc. online, the OTT has become one of the widely used services where you, by subscribing to the service, can access it from anywhere in the world through public internet.
Both the services are getting popular day by day due to advancements in technology and the preferred use of small screens such as Mobile devices, laptops and tablets.
The growth of the web TV & OTT market and the excessive disruption of these services to traditional broadcast services have made regulators vigilant all over the world. Moreover, the broadcasters and TV operators and other traditional service providers are losing their market share to online web TV and content providers, added PEMRA.
PEMRA further stated that there are other regulatory issues also which necessitate it to regulate & hence license the Web TV & OTT services. For example, all PEMRA licensed broadcasters are subject to compliance with code of conduct-2015 which require the operators to have in-house delaying mechanism and editorial control to filter out content which is not in compliance with the code of conduct etc.
However, the web TV and OTT players are not subject to any code of conduct & other PEMRA laws. Since OTT & Web TV operators are competing for the same advertisement or subscription revenue as the licensed operators, therefore, it is imperative that the services be regulated at par with other services.
Web TV has been defined as broadcast of content either live or recorded made available for viewing of the public through internet either free of cost or on payment of a subscription fee in the draft.
The content to be made available will either be produced by the licensee or he should have the copyrights for it. The service is equivalent to linear TV such as the satellite TV channels licensed by the Authority, however, the difference is only in the medium i.e. it is available via internet. The content shall be in accordance with the Code of Conduct of PEMRA. Web TV shall be considered as a broadcast service, said the draft.
Over the Top (OTT) TV
Over-the-Top (OTT) TV refers to content services which are accessible over the internet and can be accessed from any place at any time on private or public internet by users using variety of devices either free of cost or by paying a subscription fee to the service providers.
The content to be made available shall be either produced by the licensee or he shall have copyrights of it. The content shall be in accordance with the Code of Conduct of PEMRA.
PEMRA also added that The Web TV or OTT Service shall only include the television or content services as elaborated above and shall not include any telecom related or any other service which is in the exclusive domain of Pakistan Telecommunication Authority (PTA) or any other regulatory authority.
The Web TV and OTT shall be two different services and Separate Licenses shall be issued for the Web TV or OTT service.
The eligibility criteria for licensing will be as follows:
- Any company registered under Companies Act 2017 having paid up capital of not less than Rs. 3 million.
- A company, directly or indirectly, cannot be granted more than one Web TV or OTT content service licence.
- The applicant company shall demonstrate, through financial & technical feasibility, that it has sufficient financial & technical resources to launch, establish and operate the Web TV or OTT Service in relevant cases.
- In case of OTT Service, the applicant company must not be holding, directly or indirectly, a broadcast media licence or a landing rights permission as required under Rule 13 of the PEMRA Rules 2009 or another OTT service license while in case of Web TV, the applicant company must not be holding, directly or indirectly, a distribution service license, an OTT Service licence or another web TV licence.
- For a Web TV Service license, the management, control and majority shareholding of the applicant company must vest in the local nationals.
- For an OTT Content Service license, for local companies, the management, control and majority shareholding of the applicant company must vest in the local nationals. However, for foreign companies following shall be the requirements:
- The company shall have to register in Pakistan with the Securities & Exchange Commission of Pakistan (SECP) under the Companies Act 2017 and the Authority may grant exemption from the requirements of management control & majority shareholding vesting with local nationals
- The company may enter into a distribution / partnership agreement with a local company registered with SECP under the Companies Act 2017 and the local company may apply for the OTT Service license to the Authority.
- The company shall have to register with income tax / sales tax etc. authorities of Pakistan and pay applicable taxes as per the prevalent laws of Government of Pakistan.
- In either case the company when granted a license shall have to comply with the Code of Conduct-2015 & other PEMRA laws.
PEMRA stated that licenses shall be awarded for a period of five (5) years.
PEMRA noted in the proposal available on its website that such a practice is not being followed in most countries and so far only four countries have tried to introduce such policies and have failed to implement them.
The study of international practices suggests that web TV and OTT services are not regulated the same way as traditional TV & broadcast services are regulated.
You can further read the draft over here.