Govt Determined To Regulate Amazon, Google, Microsoft’s Cloud Services In India; Will This Work?

The Telecom Regulatory Authority of India has now said that cloud service providers are to be regulated under its provisions. TRAI chief RS Sharma on Friday (February 28) has said that CSPs are service providers under the TRAI Act, thus it will be dealing with their issues.

AWS, Microsoft Azure, Alibaba Cloud and Others to be Regulated by TRAI

Sharma spoke at an open house discussion on a TRAI consultation paper, seeking suggestions for a framework to set up an industry body to regulate cloud service providers like Amazon Web Services, Microsoft Azure, Alibaba Cloud, VMware and CtrlS.

In October 2019, TRAI 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.

Another TRAI official also clarified that anything which is wireline, audio, sound or image, is covered under telecommunication and therefore, well within the framework of the TRAI Act.

Why are CSPs Worried About this Decision?

The Cloud Service Providers or CPSs, like Amazon Web Services (AWS), Google Cloud and Microsoft Azure, including others as well are currently regulated by the Ministry of Electronics and Information Technology (MeitY).

This is why several CSPs are worried that since they are already bounded by government departments outsourcing and contract laws, they raised questions on additional interference by TRAI.

A representative of Amazon Web Services said all the issues raised in the TRAI consultation paper are already governed by some law or the other, be it data processing or compliance needs.

They said that RBI, SEBI and IRDAI have very strict outsourcing guidelines that are enforced as well on us. Overarchingly, TRAI’s IT Act governs each of their offerings along with contract law.

TRAI Says there’s No Need to Worry

To this, TRAI chief Sharma said that all TRAI recommendations are sent to the Government of India and not to any single department. It had also sent recommendations to BN Srikrishna committee when it was deliberating on the draft of Data Protection Bill, 2019, he pointed out.

Sharma said that the industry should not necessarily criticise TRAI as it has not been trying to regulate it but waiting to see if the industry voluntary adopts best practices or conduct of codes.

In the last couple of years, India has emerged as an important growth market for cloud services. Last year, Reliance Jio had announced its partnership with Microsoft to offer cloud data services. Both the companies are working to enhance the adoption of leading technologies like data analytics, AI, cognitive services, blockchain, Internet of Things, and cloud computing for SMEs and startups.

COAI had 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.