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Role of TRAI: Favours Net Neutrality but Conditions Apply

Quantitative Research Professional
Nov 29, 2017 1:28 PM 4 min read
Editorial

TRAI-on-Net-NeutralityThe Internet’s role has changed from a luxury to that of a utility in less than two decades. The eye-watering pace of its growth means the regulator has always played catch-up.

 

Recent debate around the ability of Internet’s gatekeepers i.e. the telecom companies and Internet Service Providers (ISPs); to discriminate between online content or services based on commercial considerations has naturally raised wide-spread concerns.

 

In plain speak, this possibility implies that a tech giant such as Facebook would be able to deliver its applications at a faster speed for a higher price through an agreement with Airtel vs. say an early stage start-up who cannot match the former’s financial firepower.

 

This discriminatory treatment goes against the very essence of the Internet as an equalising medium where, in theory, an amateur or a bunch of entrepreneurs should have the same outreach as a big corporation.

 

These concerns which push for fair access to all content available online have become the centre of the debate termed as “net neutrality”.

 

Role of TRAI

 

India’s Telecommunications Regulator (the Telecom Regulatory Authority of India or TRAI) has been at the forefront of setting the domestic direction on this issue.

 

After conducting consultations with all stakeholders for more than 2 years, TRAI released its recommendations on Tuesday – and in-principle upheld the basic idea of keeping access to the Internet non-discriminatory.

 

By clearly disallowing “preferential treatment”, TRAI forbids the transmission of any online content or service at a higher priority vis-à-vis others, including practices such as blocking, degrading, slowing down or granting preferential speeds or treatment.

 

With the US Federal Communications Commission (FCC) planning to dismantle net-neutrality, the Indian Regulator has pleasantly struck a progressive stance.

 

Its final view is aligned with an earlier decision to outlaw differential pricing for data packages in 2016, which resulted in shutdown of products such as Facebook’s Free Basics and Airtel Zero.

 

Background

 

The issue of net neutrality first gathered steam in India in 2014, after Airtel attempted to levy additional charges for making voice calls (VoIP) from its network using apps like WhatsApp, Skype, etc.

 

This was furthered by Airtel launching a marketing platform called 'Airtel Zero' which would allow customers to access apps of participating developers at zero data charges.

 

Around the same time, Reliance Communications and Facebook came together to launch Internet.org (later re-branded as Free Basics) which would enable users to access a select list of 38 websites free of charge, thereby prioritising access for in-house services.

 

These announcements posed a threat to the Internet's underlying freedom, naturally causing an outcry amongst activists who demanded regulatory intervention.

 

Core Issues and Arguments

 

A solid foundation for net neutrality will not only ensure that a customer has unrestricted access to all content available on the Internet, but will also cater to the varying concerns of stakeholders in the industry.

 

For instance, telecom companies and ISPs have consistently spoken in favour of a differential pricing mechanism as they argue that since the capital investment in network infrastructure and spectrum is theirs, they should be allowed an opportunity to monetise.

 

They also argue that Over-the-Top (OTT) services, such as WhatsApp, Skype, and YouTube, which uses the Internet to provide voice, video, and messaging services, in a way take a pie of the revenue share from the telecom companies themselves.

 

Part of these concerns may be valid, but the other part simply goes against consumer interest and reflect the inability of telecom companies to compete with new-age tech models.

 

The Internet is a thriving avenue for start-ups and a differential pricing policy has the potential to skew this level-playing field.

 

In fact, many global tech giants such as Facebook and Google rose in the shadows of this very freedom while outpacing older competitors.

 

The Devil is in the Detail

 

TRAI has not taken a blunt view by including all content or services within a non-discriminatory framework.

 

There are in fact 3 categories of services on which discriminatory pricing may be applied:

  1. the so-called “specialised” services
  2. Internet of Things (IoT) identified as “specialised” services (or critical IoT)
  3. content or services hosted on telecom companies’ own networks rather than the “public” Internet i.e. Content Delivery Networks (CDN) e.g. apps like Wynk Music, Wynk Movies, JioTV, JioMusic etc. 

 

The precise criteria and definition of “Specialised” services are unclear, with the onus of identification falling on the Department of Telecommunications (DoT). They are understood as mainly B2B services which require a minimum assured quality of service.

 

However, precedents from other jurisdictions show that aside from including essential healthcare services (e.g. tele-surgery) where a discriminatory treatment may make sense, VoIP (such as WhatsApp) and IPTV services (such as TataSky) can also be included, where the burden for higher pricing may ultimately fall on the consumer.

 

Also, though TRAI positions the CDN exemption as a measure to improve congestion over the public Internet, their admittance that by 2020 over 64% of total Internet traffic may end up on CDNs, makes this argument sound disingenuous.

 

Last Word

 

Liberals should rightly jump with joy but keeping in mind that without clear framing of detailed guidelines, vigorous monitoring and enforcement, large service providers would be able to find sufficient loopholes to bypass the spirit on their actions.

 

Though we need to have an open character for our Internet, it is important to note that a massive portion of our population still does not have access to it. For any regulator treading this fine-line between the two will prove to be a real challenge.

 

With editorial inputs from Nikhil Arora and Simi Sebastian