Will India win net neutrality battle?

The article by Pratap Vikram Singh and Taru Bhatia was published by Governance Now on January 5, 2016. Sunil Abraham gave inputs.

India is gearing up for an era of startups and entrepreneurship and the man pushing it as one of his biggest development and self reliance agenda is none other than prime minister Narendra Modi, who launched the ‘Startup India, Standup India’ campaign this year. Few technology giants, led by the likes of Facebook and some telecom service providers, however, have thrown a technology spanner. It is important to note that a significant number of the startups in India are internet-based – next only to the US and China in having maximum number of tech startups, according to industry body NASSCOM.

For these to flourish and for India to have next Facebook or Google it is important to have an open and neutral internet, believe digital rights experts. A network which doesn’t discriminate between the data packets (smallest unit of information sent in binary format over a network) and provides level playing field for all. “It is critical for the Startup India campaign. If we let the principles of net neutrality be compromised, then it makes it very difficult for entrepreneurs and startups to compete against established players, who can close off the market for upstarts by schemes like differentiated pricing and zero rating (toll free access to websites or apps),” said Vishal Misra, associate professor, department of computer science, Columbia University.

A prerequisite for startups

A few months from now, country’s telecom regulator, the Telecom Regulatory Authority of India (TRAI), is going to decide whether internet would remain neutral and whether it will continue to foster innovation. A major threat to net neutrality, according to civil society and digital rights experts, comes from zero rating – toll free access to a few selected websites or apps, a strategy adopted by internet service providers or internet platforms to hook users to those select few sites. For telecom and internet service providers zero rating is a new stream of revenue, a way to secure optimal return on investment from their existing subscriber base – without requiring additional investment. The ISPs are arguing that they should be given more flexibility in managing their network – in a way they should be allowed to assume the role of gatekeeper of the internet.

For ISPs, net neutrality is an obsolete and utopian idea. Facebook, which has grown into a mammoth internet platform since its inception in 2004, has recently joined this bandwagon. Under its Free Basics initiative (erstwhile internet.org), the internet giant provides toll free access to a set of websites (including Facebook obviously!) handpicked by itself to the users. In India so far it has partnered with Reliance Communications.

Facebook by far is the most audacious and aggressive proponent of ‘zero rating’ scheme. From lobbying the prime minister to giving back-to-back ads in television channels and two-page ads in national dailies to circulating a vaguely written letter in support of Free Basics on its social media site, Facebook is pitching for  ‘digital equality’ by giving access to 'basic internet’ or say a slice of the internet.

Cautioning against zero rating, Prabir Purkayastha, chairperson, Society for Knowledge Commons, said the way zero-rating is being discussed, it seems Indians are only the consumers of internet, which is not true. “Indians are also the innovators on internet,” said Purkayastha. “Internet has given the innovators the right to connect to the users without having a huge amount of money. This is the character that will be destroyed if zero-rating will be implemented,” he says.

That’s true. Be it US-based Facebook or Google or Indian Flipkart or PayTm or SnapDeal, had it not been for open and neutral internet they wouldn’t have become what are today.

Raman Jit Singh Chima, global public policy director, Access Now, a New York-based firm working for digital rights, said the idea is to prevent a telco or an internet platform from assuming a role of a gatekeeper and control access. Misra, too, has written extensively on the counter-productiveness of zero rating: stifling of innovation and service providers loosing incentive to improve service and keep prices low. Both Misra and Chima testified their views on net neutrality to the standing committee on IT in August after the department of telecommunications submitted an expert committee report on the neutrality issue.

Whither public consultation

To formulate a regulation on how internet will shape up, the TRAI has come out with two consultation papers concerning net neutrality in the last nine months. The first consultation paper on ‘regulatory framework for over the top players (OTTs)’, which came in March, was written in favour of telecom and internet service providers. “It was embarrassing,” said Purkayastha. Over 1.2 million people wrote to the regulator. This was result of the savetheinternet.in campaign ran by free internet activists and lawyers, who were later joined by All India Bakchod (AIB) whose video on net neutrality went viral on YouTube (the video has received three million views in last eight months). This was unprecedented in the history of TRAI consultations. However, the fate of those responses is still unclear.

In December the regulator brought another paper. This time it was titled ‘regulation on differential pricing’. Contrary to the initial paper, this paper is far more objective and reasonable, said Nikhil Pahwa, founder, MediaNama portal and a key volunteer behind savetheinternet.in campaign. The regulator has sought comments on its second paper by December 30 and counter-comments by January 7. Till the time a final call is taken, the telecom regulator has instructed Reliance Communications, Facebook’s India telecom partner, to put Free Basics on hold.

The savetheinternet.in campaign has formulated the responses to the new consultation paper and has made it available for everyone favouring net neutrality to send it to the TRAI. The AIB team has released another video titled ‘Save the Internet - 2 – Judgement Day’, which has been viewed close to one million times in just four months.

The neutrality debate started in India in December 2014 when Airtel, country’s largest telco, announced – although it later backtracked – that the company would charge consumers more for using VOIP services, on top of the data charges. Later, it went on to launch Airtel Zero, wherein it struck deal with online services providers for user access at zero rate. Facebook had already introduced internet.org by then. While it was initially led by civil society, the debate was later joined by politicians – Naveen Patnaik, M Chandrashekhar, Jay Panda, Rahul Gandhi and Arvind Kejriwal – who strongly came out in support of net neutrality.  

Facebook has termed its zero rating platform as a philanthropic activity intended to connect billions of unconnected population so that they can access education, health and employment related information. It has urged users to sign a petition, cautioning them against "a small, vocal group of critics" lobbying to prevent 1 billion people from accessing 'affordable internet'. Under Free Basics, Facebook claims, it doesn't charge app developers and includes them if they comply to its 'objective tech specs'.

Free Basics: A camouflage?

Critics, however, call it a walled garden. In providing free access to close to a hundred websites it continues to play the role of a gatekeeper. It is not the poor who decide what to access but Facebook! While it says that it is not making money out of Free Basics as it doesn't display ads in the Free Basics version of Facebook, it keeps the option of monetisation open in the future.

“It [Free Basics] has been camouflaged as charity," said a senior TRAI official, in an off the record conversation. While speaking to the Guardian on Facebook’s zero rating in December, Tim Berners Lee, founder of world wide web (www), said, “In the particular case of somebody who's offering... something which is branded internet, it's not internet, then you just say no. No it isn't free, no it isn't in the public domain, there are other ways of reducing the price of internet connectivity and giving something... [only] giving people data connectivity to part of the network deliberately, I think is a step backwards.”

Speaking in favour of zero rating, Payal Malik, associate professor, economics, Delhi University, said that it is wrong to assume that all consumers will get hooked to zero rated sites. “In a way you are saying that all humans have same preferences and likes and dislikes, which is very unlikely,” said Malik.

Experts representing telecom industry argue that the net neutrality regulation should be geography specific and the telecom players should be given more flexibility in dealing with the network. Mahesh Uppal, a senior telecom consultant and director, ComFirst India, while speaking at a round table discussion in Delhi, said that a majority of population in the West including countries opting for strict net neutrality – including Netherlands, Slovenia and the US – are already connected. "The data connectivity is primarily through fixed lines - copper, co-ax cable or optical fibre wired — wherein it is easier to add capacity to meet traffic growth. However this is difficult to do so for wireless networks," said Uppal. In developing countries, including India, mobile telephony and internet majorly runs on wireless. Hence, he argued, telecom and internet service providers should be given flexibility to zero rate. For Uppal, if zero rating or sponsored content is implemented properly “it can be one of the ways to scale up internet access” to the unconnected regions.

Neutrality proponents, however, differ. “It is basic economic theory, and zero rated sites get a price advantage. There are studies that show customers stay within the world of zero rated sites and never venture outside or are aware of the full internet,” professor Misra said.

Zero or equal rating?

So is there a middle ground? Are there ways to increase access without tampering with open and neutral character of the internet? Experts believe there are. Some of the solutions are not completely black and white, but in between. While there is a fierce opposition to zero rating, it might work, according to Sunil Abraham, executive director, centre for internet and society (CIS), if provided with an amount of equal rating (giving free data pack to users so that they can access any site or app they want).

Mozilla Foundation advocates equal rating. The foundation has sought to create such an alternative in Bangladesh and countries in Africa within the Firefox OS ecosystem. The foundation has tied up with telecom operator Grameenphone in Bangladesh to provide 20 Mb data per day for free to users, in exchange for viewing an advertisement. The model could be easily replicated in India, said Pahwa of MediaNama.

For African countries, the foundation has partnered with Orange. Both allow Africans to purchase $40 Firefox OS smartphones that come packaged with free three to six months of voice calling, text, and up to 500 Mb of monthly data. Purkayastha of Knowledge Commons said that zero-rating plan by telecom operators only makes sense when government services are provided for free through it. “That is the form of zero-rating I would support.”

There are a few platforms which are reimbursing data in megabytes to users accessing partnering apps. The user can then use the free data pack to access any other site or app. Some of them include: mCent, Gigato and DataMi. mCent, owned by Boston-based firm Jana,  is a pioneer in this area. It is being used by 30 million users cross 98 countries. In India, according to Jana, one out of every 10 internet users has subscribed to mCent.

Yes, it does violate neutrality as it puts those app providers not having enough money at a disadvantageous position vis-à-vis to those having deep pocket to reimburse data to users. “I think it’s a grey area,” said professor Misra. On the surface it seems to be just like Free Basics, however, Gigato (or mCent) is making no pretense that what they are doing is philanthropy of increasing access, said professor Misra, adding that it is still acceptable as user will have the data to venture out of the walled garden. The senior TRAI official too finds it acceptable. “In my opinion, Facebook should become like Gigato,” he said.    

If the regulator is going to protect consumers’ right and also not stifle startups and entrepreneurism, it will have to ensure some broad, core principles of the internet. It will have to prevent both the ISPs and the internet platforms from becoming gatekeepers. It must not allow any throttling, blocking, fast and slow lanes, discrimination based on price or quality of service and distortion of level playing field. How and whether TRAI is going to do these would be clear in a few months.