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Editorial Today – Free Basics, now through the backdoor

editorial--72Issue A new TRAI consultation paper proposes models that will get Free Basics-like services back in a slightly altered form.

Background Over the last one year, Indians have engaged in a passionate debate on the concept of Net neutrality.

What is free basics It an application by Facebook which provided its own content and that of its partners free to consumers.

Reason given for banning free basics It was said that Internet was first a public good before being a market one.

Why is it in news again? Now the regulator is having second thoughts.

What is the view of TRAI (Telecom regulatory Authority of India ) now

The present consultation paper is a complete turnaround from its previous view , suggesting that these were never the problem.

Various models suggested are Reward based Model,Toll Free API Model and Direct Transfer Model.

About the suggested model  The suggested models will just make Free Basics kind of services more ubiquitous, as well as a permanent feature, and not merely a promotional one, as earlier touted by its promoters.

Problem with this The regulator seems to be drawing an interesting line — services provided by telcos are under a public goods framework, but those rendered by the Internet companies subject only to free-market principles.

Internet exceptionalism Internet Exceptionalism  refers to the internet specific laws that diverge from regulatory precedents in other media.

Problem created by Internet activists Internet activists advocating Net neutrality are often themselves guilty of it.

Conclusion

 

Issue

  • A new TRAI consultation paper proposes models that will get Free Basics-like services back in a slightly altered form — by making an absurd distinction between telecom and Internet services.

 

Background

  • Over the last one year, Indians have engaged in a passionate debate on the concept of Net neutrality, whereby all content should be treated equally on the Internet. The problem of content discrimination on the Internet got most associated with Free Basics.

What is net neutrality- Read Editorial Today #56- Why India should keep an eye on Europe

  • The Telecom Regulatory Authority of India (TRAI) has rolled out a new consultation paper, titled ‘Consultation Paper on Free Data’. This paper is third in the series of consultation papers that TRAI has rolled out since April last year with the intention to find a workable solution to the issue of increasing internet access in the country while preventing the throttling of content that is accessible through some platforms controlled by telecom service providers (TSPs), also known as the ‘Net Neutrality’ issue.
  • To understand the premise of this paper we need to take a step back and look into the two papers before this one. The paper on ‘Regulatory framework for Over-the-top (OTT) Services’ asked the question, ‘Who will pay for what is offered for free?’ and in the paper on ‘Differential Pricing for Data Services’, TRAI asked, ‘How to pay for what is offered for free?’. The first paper saw vibrant public debate around the issue that, while TSPs are investing in putting up physical infrastructure for the growth of mobile internet, application providers are piggybacking on this infrastructure without adding any value or investing in it. The paper on ‘Differential Pricing’ not only saw a public debate but was also instrumental in pushing through a regulation that effectively banned differential pricing by TSPs and put Facebook’s Free Basics platform on the back burner. In the light of these two papers, the paper of ‘Free Data’ finally seems to ask, ‘What is it that can be offered for free?’

 

What is free basics

  • It an application by Facebook which provided its own content and that of its partners free to consumers, while all other content remained paid for.
  • This violated the principle of net Neutrality.
  • But the Indian public protested and giving in to popular demand, in February 2016 the regulator banned Free Basics-like services based on discriminatory pricing of content.

 

Reason given for banning free basics

  • It was said that Internet was first a public good before being a market one.
  • In agreeing to ban Free Basics everyone thought that the regulator agreed differential pricing to be an inappropriate practice, for consumers, including poor consumers, as also for the larger society.
  • Indeed, the regulatory order eloquently argued that “price-based differentiation would make certain content more attractive to consumers resulting in altering a consumer’s online behaviour (and)… the knowledge and outlook of those users would be shaped only by the information made available through those select offerings”.
  • It further offered reasons of freedom of expression and plurality of views for banning differential pricing.

 

Why is it in news again?

  • Now the regulator is having second thoughts.
  • According to experts a new consultation paper proposes models that will get Free Basics back, though in a slightly altered, and perhaps disingenuous, way.

 

What is the view of TRAI (Telecom regulatory Authority of India ) now

  • The present consultation paper is a complete turnaround from its previous view , suggesting that these were never the problem.
  • It was not at all the issue that Free Basics discriminated with regard to the content as received by any consumer. The real problem was that Free Basics had an exclusive agreement with just one telco to do so.
  • It would accordingly be fine if Free Basics entered into a similar agreement with all telcos.

 

Various models suggested are

  • Reward based Model: Whenever users access a website/application from the ‘TSP agnostic’ platform they will be rewarded in form of data/voice usage. There is no clarity in the paper on how users who have not yet been connected to mobile internet through smart phones can use such a platform that rewards ‘after’ using a service. Also, this model misses out on the fact that a user would need to pay to be online with sufficient ‘data balance’ to use such a model.
  • Toll Free API Model: This is an alternative that would allow users access to all content from the platform but not charge them for ‘access to certain websites and applications’. This seems like a watered down version of Facebook’sFree Basics and the paper claims that such models are existing in many developed countries without going into further details.
  • Direct Transfer Model: In this model the user will use data normally and the cost of data will be transferred to her bank account, much like the direct benefit transfer prevalent for LPG cylinders. This model is very similar to the Reward based model and will also need that the user pays upfront to avail ‘free’ usage later.

 

About the suggested model

  • The suggested models will just make Free Basics kind of services more ubiquitous, as well as a permanent feature, and not merely a promotional one, as earlier touted by its promoters.
  • The only significant new feature of the proposed models is that telcos will not be able to benefit from content-based price discrimination. However, they will facilitate ways whereby content providers can pick up the tab for consumers accessing their content (and not other).
  • Other suggested models would get the telco entirely out of the picture, with consumers reimbursed directly by content providers for the access of their content.
  • At the consumer end, all these models have exactly the same effect as telco-controlled models — of incentivising accessing some content and services over others, undercutting the key equalising feature of the Internet.

 

Problem with this

  • The regulator seems to be drawing an interesting line — services provided by telcos are under a public goods framework, but those rendered by the Internet companies subject only to free-market principles.
  • It seems not to matter that the actual impact on individuals and societies of non-Net-neutral practices by either is exactly the same.

 

Internet exceptionalism

( Internet Exceptionalism  refers to the internet specific laws that diverge from regulatory precedents in other media.)

  • According to experts such an attitude comes from a problematic trend that has been called “Internet exceptionalism”, whereby the Internet is considered to be some kind of uniquely regulation-free zone.

 

Problem created by Internet activists

  • Internet activists advocating Net neutrality are often themselves guilty of it. For Example
  • The ‘Save the Internet’ campaign, by far the most active group in the Net neutrality struggles, declared in its first submission on the issue to the regulator last year that “no new regulatory framework in the telecom sector is required for Internet services and apps — and no such regulation should come into effect in future either”.
  • These Internet activists are now faced with a piquant situation when the regulator, as they themselves urged it to do earlier, is making a distinction between regulating the telcos and regulating “Internet services and apps”. This will result in people getting a non-Net-neutral Internet now through an Internet platform instead of a telco one. This group’s new submission now argues that whether Net neutrality violation is done by telcos or by an Internet platform it should be banned, apparently reversing their earlier stand.

 

Conclusion

  • Having banned Free Basics-like content discrimination services when involving a telco, it is ludicrous to now propose to allow the same by Internet companies directly.
  • This attempt to bring back the much-detested Free Basics through the backdoor, by making an absurd distinction between telecom and ‘Internet services’, is the right opportunity for us to get out of this wrong binary regulatory mindset.
  • We must consider our old and new communication systems as one important social sector requiring close regulatory watch in public interest.
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  • Some of the basic needs are important to have now in India. Some suggestion made in this article is also good alternate idea. I prefer lets we can Reward model and Reward batch along with referrals.

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