Reversing the VoIP ban a step forward for Morocco's mobile segment

For up to a year in 2015 and 2016 Moroccans were prevented from making free voice calls using voice-over-internet-protocol (VoIP) apps, which have become a key communication tool across most telecoms markets. It was a contentious decision that led to vociferous objections among consumers. By November 2016 the ban was reversed and the use of VoIP apps was permitted. The reversal was welcomed by users, but not before the ban had a negative impact on the economy and cemented the image of a sector regulator working more to ensure operators’ profits than quality of service.

BACKGROUND: The move became official in January 2016, after Moroccan telecoms operators had begun blocking the use of VoIP apps such as Skype, Viber and voice calls on WhatsApp in late 2015. The National Telecommunications Regulatory Agency (Agence Nationale de Réglementation des Télécommunications, ANRT) supported these actions through an official decree, wherein it stated that only operators with an authorised telecoms licence would be able to provide communications services within the kingdom. By March 2016 the ban was extended to include fixed internet home connections. The decision was strongly contested by Moroccan consumers, who for years had been able to use free voice apps for both domestic and international calls. The ban and its reversal were further surrounded by speculation after the ANRT allowed VoIP calls almost immediately before the country was set to host the November 2016 COP22 UN Conference on Climate Change in Marrakech.

ECONOMIC IMPACT: Internationally, as in Morocco, shrinking earnings from voice consumption have been pressuring telecoms players to adapt to this new context. Improving revenues from data has been one way for operators to make up for reduced earnings. However, this transition usually takes time. The VoIP ban was considered especially punitive for lower-income Moroccans, as 41m of Morocco’s 44m mobile phone users are prepaid, according to third-quarter 2017 figures from the ANRT.

Besides pressure from Moroccan consumers, who criticised the ban on social media and organised online petitions, a study published by US-based think tank the Brookings Institution in early October 2016 might also have had an effect. The report estimated that the cost of Morocco’s VoIP ban for the economy reached as high as $320m. The same study looked at the negative consequences of 81 temporary internet shutdowns in 19 different countries, including India, Saudi Arabia, Morocco, Iraq and Turkey, among others. According to the Brookings Institution, the total loss to GDP from those bans amounted to $2.4bn globally between July 2015 and June 2016.

LEGAL BACKLASH: The VoIP ban even led to a lawsuit filed in April 2016 against the ANRT by an unnamed mobile user in the eastern city of Oujda. The plaintiff’s lawyer told local press that the case was based on the fact that the VoIP ban had been implemented to protect Maroc Telecom.

Whether it was domestic backlash, the economic costs, fear of bad publicity ahead of the UN summit or a combination of all of these elements, the episode has underlined the importance of having an impartial regulator. In Morocco’s case, the decision to ban VoIP apps was immediately perceived by the public as a transfer of financial resources from users to operators. This was especially troublesome due to the fact that the Moroccan government is an important shareholder in Maroc Telecom.

In telecoms, as in other sectors, regulatory decisions that can be interpreted as self-serving significantly reduce a watchdog’s credibility. Over the long term a divestment of state participation in the telecoms sector and a strengthening of the regulator’s independence will be critical to expanding internet usage and access across the kingdom.