Skype will be subject to telecom sector regulations

Skype will be subject to telecom sector regulations
After a long-standing legal tussle, the European Court of Justice has ruled that Skype should be classified as a telecoms operator. The news will have a big impact on all VoIP apps.

Microsoft’s popular VoIP and messaging service Skype will now be classified as a telecoms operator, according to a ruling from Europe’s top court. The platform’s ‘SkypeOut’ service, which allows users to make phone calls to fixed or mobile phones for a fee, was one of the key reasons for a long-standing dispute between the company and the Belgian telecoms regulator.
The tussle dates back to 2011 when the Belgian Institute for Postal services and Telecommunications (BIPT) had requested Skype to provide notification of its services under the existing telecoms laws. The company however argued that it did not transmit signals itself or provide electronic communications services as defined by the current EU laws.
BIPT, along with a Belgian court, had sought guidance from the European Court of Justice – the top court in the EU. Despite the arguments made by Skype, the ruling has declared that VoIP services such as Skype are subject to European telco regulation. Essentially, the ruling means that VoIP calling apps are an electronic communications service under the EU laws. Since Skype charges customers for these calls and also enters into agreements with communications services providers to send and terminate calls, it will also be subject to these regulations.
Microsoft has stated that it will comply with the ruling which will subject Skype to much stricter EU guidelines.

The impact of the ruling

The ruling means that VoIP services such as SkypeOut will be regulated under existing EU laws which cover areas such as privacy, registration, consumer protection and calling to emergency services, among others. Interestingly, similar services in the US that allow calls to phone numbers are either not subject to telecoms regulations or are very lightly regulated.
In a bid to bridge the gap between traditional telecoms operators and newer digital communications services, the European Commission had already released a new European Electronic Communications Code last year which expanded the definition of ‘electronic communications service’ to include the likes of Skype, WhatsApp and other VoIP services. The new rules will kick in December 2020.
According to legal analysis platform Lexology, the court ruling may also have implications beyond just telephone calling apps and apply to other digital services too. Since the existence of agreements with telecom providers has been one of the key reasons behind the ruling, the regulation may be extended to other digital services which charge users. In addition, the European Court of Justice is already examining whether email services such as Gmail and others should be covered under the same domain of electronic communications services and subject to telecom regulations.
It appears that the regulators are slowly reining in digital service providers which have long enjoyed a light regulatory touch. With digital services and telecom operators increasingly on a level playing field thanks to regulations, will this become an opportunity for forward-thinking communications services providers? It will be very interesting to see who makes the next move.