The global life and business is now governed by the use of internet. E-tailer, telco faced criticism for decision to join hands for zero-ratings offering. Start-up entrepreneurs erupted in joy after the country’s largest online retailer Flip-kart retreated from a program that critics said could have resulted in an unequal Internet and thus stifled competition. By turning its back on India’s largest mobile phone company Airtel, Flipkart is responding to the pressure from within and without after severe criticism of its intention to use its substantial financial muscle to subsidised users of its app, analyst reacted. In the circumstances, due to change of heart, Flipkart’s Commerce Head, Mr. Mukesh Bansal said – “Some zero rating scenarios could have laid to some discrimination in future.” Therefore, decision to pull out took place in the last 24 hours (this was the position on 15-4-2015) after long debate with Flip-kart top leadership. Zero rating tie-up could have resulted in a two speed internet for consumers and stifled competition, say critics. The good part of this is that this move will also put pressure on other corporates too not sign zero-rating agreements. If this happens and it should happen, which will bring net neutrality to fostering innovation.
The battle for net neutrality is based on the principle that all traffic travelling across internet should be treated equally at all stages and the price rate and speed should be the same. In this regard, entrepreneurs and experts tell us why a free internet is an absolute condition for innovation and consumer choice to thrive in India.
Incidentally, it appears that India in all likelihood may go net neutrality following the US way with internet being taken as essential service and provided without any discrimination.
Internet users in India sent an unprecedented 3 lakh e-mail submissions over the last 3 days to the telecom regulator TRAI asking it to protect net neutrality. This movement, which began in response to a TRAI
“Consultation Paper”, was galvanised by the potential alliance between the country’s top line retailer and the biggest phone company.
Flipkart and Airtel faced heavy criticism on social media and even the Telecom Minister threw his weight in favour of net neutrality.
Let us understand clearly what is
‘zero ratings’? Right now, mobile users in India can access any website and applet for the same charges. What telecom companies were proposing was against this principle. Airtel Zero is an example of it. Airtel was planning to tie-up with Flipkart, under which Airtel subscribers would have been able to shop from Flipkart for free. But if you were to shop from a rival online retailer, Airtel would have charged you. This is what netizens were strongly against.
Neutrality means you can access any website, app and social media site from any telco or ISP, with no discrimination in cost or speed. It is widely pursued as a violation of the principle of net working neutrality, where all data is treated equally regardless of its origin. Against this backdrop, for many starts-up that feared larger incumbents could use their financial muscle to subsidised users, zero rating platforms presented a dilemma. Therefore, the choice would be to break net neutrality by joining such platforms or lose out to competition.
“By rejecting net neutrality, we will be closing the door on the entrepreneurial aspirations of millions and leave telecom companies to play gate keeper,” said Sumit Jain, co-founder of Commonfloor.com.
In the above circumstances, the telecom regulator had asked for separately stakeholders to submit their comments on the consultation paper titled –
“Regulatory Framework for over-the Top Services”, or services like Skype by April 24. In December last year, Airtel tried to introduce a plan to charge Internet Telephony Firms like Skype and WhatsApp a higher tariff. However, the telecom operator withdrew the plan after widespread public protest.
Meantime, online marketing trend is not restricted only to expensive goods. The demand is from clothes to cosmetics, grocery and sports goods etc. According to Internet and Mobile Association of India and Indian Market Research Bureau international report, in India online marketing turnover up to end of calendar year 2015 will be over
Rs. 1 lakh crore. The said report further says that 45% customers took the delivery of goods by paying cash, 21% pay for the goods by debit card, 16% pay by credit card and 10% make payment through internet banking. And 8% pay by prepaid cash card and mobile wallet. The said report further throws light on certain interesting findings. Financial services, matrimonial and classifieds advertisements earnings have increased online by 5.5% and further online food delivery orders have crossed earnings by 40%.
All in all, the matter is coming to a head, with the looming April 24 deadline TRAI’s ‘Consultation Paper’. If you want to keep the whole internet accessible to all, and OTTs unregulated in the interest of innovation, the time to speak up is now ! So, rise up and protect your right to net neutrality !!
D.H. Joshi
Advocate