Internet cos welcome TRAI decision on differential pricing

The internet and internet-based start-ups as well as industry bodies like IAMAI have unanimously welcomed TRAI's stand against differential pricing by telecom operators.

e4m by Abhinn Shreshtha
Updated: Feb 10, 2016 8:30 AM
Internet cos welcome TRAI decision on differential pricing

The internet and internet-based start-ups as well as industry bodies like IAMAI have unanimously welcomed TRAI's stand against differential pricing by telecom operators.

On Moday, TRAI released guidelines that barred telecom operators from levying separate tariffs for services provided over the internet based on their content. This means that platforms that work on zero rating system, where the data cost for the consumer is passed on to the service partner (e.g. companies like Flipkart, Times of India, etc.) or something like FreeBasics, where access is available to only a limited number of partners.

TRAI bans differential pricing, makes FreeBasics, Airtel Zero illegal

Industry body IAMAI called TRAI's decision a "bold and fair" move. It viewed the fact that TRAI would be the ultimate authority to decide in case of violations of this ruling and that the decision of the authority would be final and binding. It also expressed concern with an exception in the guideline, which says that the regulation did not apply to closed networks (intranet), stating that Telecom Service Providers (TSPs) might misuse this loophole. However, TRAI does state in its ruling that it would deal promptly with any operator found to be using this exception for gain.

"In a very clear and transparent ruling, TRAI has explicitly said “no service provider shall offer or charge discriminatory tariffs for data services on the basis of content” and “No Service provider shall enter into any agreement or contract, by whatever name called, with any person, natural or legal, that has the effect of discriminatory tariffs for data services being offered or charged to the consumer on the basis of content.” This move will ensure that the basic tenets of Net Neutrality are followed in India," said IAMAI in a media statement.

Samir Bangara, MD and Co-founder of Qyuki, commended TRAI on managing the entire debate in an "inclusive and balanced" manner and called TRAI's approach "refreshing".

"We are, of course, very happy with TRAI's decision to make differential pricing illegal. It upholds the country's promise to guarantee equality of opportunity to all. As far as making the internet accessible to all is concerned, I am sure the government's efforts along with those of private organizations, will be able to drive change soon. Already, Google Inc. is working with the Indian Railways to provide free WiFi at public spots," said Ankita Tandon, COO at CouponDunia.

Amresh Nandan, Research Director at Gartner, said TRAI’s decision was in line with what was seen in the US in 2010 when FCC favoured ‘Open Internet’ and came up with the ‘Open Internet’ order in 2015.

“The European Union also ruled in favour of treating all internet traffic equally. Though some of their amendments allowed for differentiation and have been a subject of intense criticism,” he added.

Speaking about the impact of TRAI’s decision, he pointed out that TRAI’s decision favouring net neutrality is in keeping with the government’s focus on developing start-ups as well as improving the penetration of the internet, without compromising on access to content.

“Proponents of net neutrality all over the world have been highlighting the importance of democratic values of internet and even a marginal attempt to curb it can possibly trigger all kinds of differentiation. Start-ups today are heavily dependent on open access of internet and any direction to control it can have detrimental effect on them as well as government’s push to start-up ecosystem,” he said.

Telecom operators are obviously unhappy with the banning of differential pricing. The Cellular Operators Association of India (COAI), the industry body for TSPs in the country has already made its displeasure with the decision known. Mark Zuckerberg has also posted about his “disappointment” with the decision.

Mark Zuckerberg expresses "disappointment" over TRAI decision

“Telecom service providers may not be happy with this notification, however they still have the ability and freedom to create different kind of internet access packages; as long as content is not a parameter to provide or bar access to anyone. Such practices have already started elsewhere with products such as bandwidth on demand, bandwidth calendaring etc. to create premium products. Obviously it will require changes in network and operations but that’s where the telecom roadmap goes,” opined Tandon.

In fact, Mozilla executive chairperson Mitchell Baker, in a letter to TRAI last year, had suggested the concept of equal rating as an alternative to zero rating. Equal rating, said Baker, would not lead to any differentiation on the basis of content, which is the main bone of contention against zero rating.

Meanwhile, other experts and dignitaries took to Twitter to celebrate TRAI’s decision:

For more updates, be socially connected with us on
WhatsApp, Instagram, LinkedIn, Twitter, Facebook & Youtube