NCC mull regulating apps as telecoms

By Ted Chen ,The China Post

TAIPEI, Taiwan — The National Communication Commission (NCC) yesterday announced that it is mulling over a move to regulate mobile apps as they may fall under the classification of Type II telecommunication enterprises, a move considered by industry experts to be detrimental to the future prospects of the mobile software development sector.

Following the change, certain mobile app developers will be required to obtain an operating license from the NCC.

Reports indicate that the NCC’s decision was motivated by the rising popularity of juiker (����), a locally-developed instant messaging app following the enactment of policies barring civil servants from conducting business over popular instant messaging platforms developed abroad such as Line. Following a probe by the NCC, the regulator announced that instant messaging apps fall under the category of Type II telecommunication enterprises, which requires companies to acquire an operating license.

In addition, reports suggest that the NCC was also instructed by the Ministry of Transportation and Communications to verify whether juiker may be classified as a type II telecommunication enterprise.

According to reports, the NCC’s intended change will likely hamper juiker’s development and proliferation in the market. In addition, heightened regulatory hurdles will also stifle growth in Taiwan’s fledgling over-the-top (OTT) mobile ecosystems. Notable OTT services include the messaging platforms Line and Skype as well as the video-sharing website YouTube, which may also face increased regulatory requirements once the NCC’s proposed change take effect.

Minister without Portfolio Tsai Yu-ling (���ɬ�) noted previously that the government should focus on maintaining information security, protecting privacy, and monitoring the flow of funds in the virtual realms of the Internet, and regulatory overstepping may cause a flight from the Taiwan market by foreign companies, an unfavorable outcome that may be likely to stifle growth and innovations and deter investors’ confidence.

A backer of juiker, the Ministry of Economic Affairs stated that it hopes to see the NCC exercise prudence in the matter and examine all OTT companies equally.

OTT operators offer services that reach consumers through networks built by telecommunications carriers. Following the growing popularity of OTT operators, profits by carriers have diminished as they do not yield additional earnings from the utilization of bandwidth. In response, carriers have been keen to reverse the situation by offering their own multimedia-on-demand services such as Chunghwa Telecom’s MOD to subscribers.