Recent NTC Memo could kill CP Business

The NTC has made amendments to the MC03-03-2005 which regulates contents/information providers to initiate the “opting-in” of subscribers to services through push messages. It’s been the focus of a lot of issues and disputes on vanishing prepaid loads.

Normally, content providers (CP) will randomly blast free ringtones or ringback tones for free (usually to promote a popular movie or event, like a concert). However, in order to get the free ringtone, one must subscribe to the weekly service. The succeeding tones are then charged to the subscriber.

This practice is now disallowed after the NTC made the following amendments:

• Push messages shall not be allowed. Subscriptions or requests for contents and/or information shall be initiated by the subscribers.
• Commercial and promotional advertisements, surveys and other broadcast messages shall be allowed only if prior consent from the subscribers is secured.
• All subscriptions for the delivery of contents and/or information made prior to the effectivity of this Circular shall continue to be honored until the expiration of the subscription. Subscribers with valid subscriptions prior to the effectivity of this Circular may opt to terminate the subscription prior to expiration. Contents and/or information service providers and CMTS providers shall inform their respective subscribers of their option to pre-terminate their existing subscriptions.

One source who’s into the CP business tells me this amendment could kill as much as 90% of the revenues generated by the industry. The telcos are closely cooperating with the NTC to monitor the Content Providers’ activity on “push messages” and I’m pretty sure there’s a lot of lobbying happening right now.