TRAI’s Consultation Paper On Cloud Services Regulations Under Scanner

The Telecom Regulatory Authority of India (TRAI) had introduced a consultation paper on cloud services, which is now being opposed by several stakeholders. On Saturday (December 7), reports surfaced that US India Business Council (USIBC), Cellular Operators Association of India (COAI) as well as other telecom companies have raised concerns on TRAI consultation paper.

For the uninitiated, TRAI in October 2019 had sought public views on parameters for companies to become members of a cloud industry body and the likely governance structure, should there be single or multiple industry bodies which may be registered under the telecom department, fees that should apply to them, etc.

USIBC said there’s more than sufficient regulation of cloud services in the industry and Indian cloud service providers (CSPs) should not be subject to new regulation. “Contrary to widespread misconception, CSPs in India do not exist in a legal vacuum, and are amply governed by various regulations including MeitY’s IT Act and MeghRaj, Department of Telecommunications’ (DoT) TSP (telecom service providers) and OSP (other service providers) regulations,” it said, adding that it backed a light-touch regulation of CSPs.

The Concerns Around Regulations

While COAI said that CSPs do not fall within the same category of service providers as defined in the Telecom Regulatory Authority of India Act, 1997 owing to the fact that CSPs merely use the existing connectivity provided by telecom service providers and do not constitute telecom service providers by themselves.

“Additional regulation, of the kind being proposed in the CP, is likely to result in regulatory overlap with many other existing laws. TRAI should also note that the proposed draft Personal Data Protection Bill, 2018 (PDP Bill) is likely to provide a comprehensive regulation on data and the same would apply to the CSPs,” NASSCOM said.

Further, Internet Freedom Foundation (IFF) agreed with the COAI’s view of questioning Trai’s jurisdiction in the matter, adding that such a move can lead to cartelization. “It is important to establish that the mandate of creating framework for the registration of industry bodies for Cloud Service Providers should not be carried by the Trai as primarily it does not have the authority to regulate cloud services,” said IFF.

IFF also said that the cloud service providers give information technology services that are supervised by the Ministry of Electronics and Information Technology (MeitY) and not by Trai. “… their main purpose is to provide information technology services, all regulation should fall within MEITY’s ambit presently and Trai cannot exert regulatory authority and powers to frame binding directions,” it said.

Not Everyone Is Unhappy

However, Reliance Jio Infocomm (Jio) backed “light touch regulation for cloud services and the implementation” through industry bodies. It, however, said that there should not be any overlapping regulatory oversight from multiple ministries and associated regulatory bodies.

The company said that the regulatory framework, once implemented, should be uniformly accepted by all the government departments. It also added that there should not be any separate requirement of adherence to additional regulations for supply of services by the CSPs.

A CII and KPMG report said that cloud technology, enabled by IT and bolstered by a sound telecommunications network, can herald innumerable solutions to enable telemedicine, set up remote classrooms, etc.

The global companies are now working to align with the government requirements, which calls for keeping data generated about Indian customers within the country. NASSCOM research says that the Indian cloud computing market is currently valued at $2.2 Bn and is expected to grow at 30% a year to $7.1 Bn by 2022.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.