Net Neutrality: The ideological battle’s won, the real war’s far from over

According to the author, the real threat is not Facebook, but telcos, and there’s a need to be more scared about living in a walled-garden with telcos as gatekeepers

Differential pricing -– quantitative or otherwise –- is a well-accepted economic principle across industries. That’s why we pay a different set of tariffs for flying in first class, business class and economy class to experience a varying degree of service and comfort.

Let’s also take the case of DTH operators like Tata Sky and DishTV –- they charge a fee to the broadcasting companies for carry their channels on the platform and offered bundled “base pack” to consumers with very limited customisation options.

However, there’s a clear distinction between differentiation and discrimination, which is not only against the competitive spirit of free markets, but also against the spirit of social justice. In that context, the “net neutrality” debate (we support it in principle but not in the way it has played out) seems to have been won against an enemy that doesn’t exist in reality while the noise has obscured the real ones. And the real issue of making information accessible to a wider audience remains unanswered.

It’s been a quarter of a century since Manmohan Singh, as India’s Finance Minister in 1991, threw open the country’s economy to competition. However, for some unknown reasons, any socio-economic debate often turns into a verbal duel between the representatives of the “haves” and the “have nots”, with both groups clamouring for cementing their place either on the right or on the left of Marx. Ironically, both the groups have very limited knowledge of Marx.

Social media like Facebook have democratised opinion making. And the best thing about this social media-driven ideological crusade is that anyone can join in. But that’s probably the worst thing as well. The biggest strategic blunder on part of Facebook’s team empowered to rollout Free Basics in India was to convert a TRAI (India’s telecom regulator)-initiated consultative process into a numbers game. People’s role in a democracy (at least in India) ends with electing their representatives and not extending to policy making.

On the other hand, the Net Neutrality crusaders played it perfectly. What was initially a tirade against the homegrown Airtel Zero platform suddenly became an all-out war between Net Neutrality and the supposed hegemony of Facebook. With social media rock stars like Mahesh Murthy and others joining in, victory was in sight even before the battle was wedged.

In contrast, those sending emails to TRAI supporting Free Basics through Facebook were mostly my mother or aunt or some “friends” who had no clue about either and were more interested to get on with their candy crushing routine.

Victorious warriors, as Sun Tzu says, indeed win first and then go to war, while defeated warriors go to war first and then seek to win. Promoting business in the garb of philanthropy could be the worst narrative any foreign company can think of while strategising about India.

Despite achieving independence seven decades back, any foreign company’s sympathy for the have-nots is an anathema to the educated masses. Facebook willingly walked into that trap and scored a self-goal. And Marc Andreessen’s twitter rant post the TRAI ruling only proved the point.

Also Read: The Andreessen tweet debacle lifted the Wizard’s curtain

Let’s set aside the ideological debate of creating a level-playing field and bridging the digital divide. Rather, let’s focus on the real issues. Facebook is a social media giant for sure, but even Facebook needs telecom services providers (TSP) by its side to emerge as a gatekeeper. Telcos will continuously look for ways to expand their customer base – just to reiterate that the “Save the Internet” campaign was initially started against the Airtel Zero platform.

TRAI’s differential tariff regulation notified on 8 February 2016 bars operators from offering differential data tariffs through select tie-ups with content providers, which it has labelled as “discriminatory”. However, it allows operators to provide free apps and content to their subscribers on closed communication. Let’s try to understand the implication of the ruling on various data packages for TSPs.

Airtel has a music streaming app called Wynk, which is available to Android users for a basic fee of INR 90 (under US$1.5) per month and INR 120 (under US$2) per month for iOS users. Bharti users get this subscription waived off if they use the company’s 3G or 4G services. The app is available to the subscribers of other operators as well, but they incur download charges. Under the ruling, such services need to be discontinued.

However, if Airtel chooses to restrict the app only to its users, the company can continue offering the service free of data charges to its subscribers. For example, Reliance Jio can offer the Jio Chat free of charge to its users, should they restrict the access of its chat app to its subscriber base only. And here lies our greatest fears as such a strategy distorts not just the reality, but the very notion of right to information which comprises the right to inform as well as the right to be informed.

The real threat is not a social media platform like Facebook, rather a telcom service providers (TSP) like Reliance. In its quest for content to be provided through its Reliance Jio 4G services, the Mukesh Ambani-led telecom arm has been snapping up content providers -– through direct or indirect control –- especially news and current affairs producers. According to a recent article in The Caravan magazine, apart from Network18 Media and ETV, Reliance also owns NDTV through a cobweb of complex transactions.

Thus, there’s a need to be more scared about living in a walled-garden with companies like Reliance as gatekeepers. The Net Neutrality crusaders seems missing the woods for the trees, either intentionally or otherwise. As of now, the supposed victory for Net Neutrality appears to be ideological at best. The real war has yet to be wedged.

Raj K Mitra co-authored this article with Harshita Nandwani, who has a number of years of experience in equities research. She is currently Assistant Vice President of International Wealth Management with Credit Suisse.

The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email at writers[at]e27[dot]co

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