Why Should India Care About Net Neutrality?

Net Netruality Jeremy

Over the past year net neutrality, which not long ago was an abstract concept of interest only to telecommunications policy wonks, has captured the public attention both in the United States and in India. This is despite the fact that as a definition, it seems somewhat dry and abstract—“Net neutrality requires that the Internet be maintained as an open platform, on which network providers treat all content, applications and services equally, without discrimination.”

The key to enlivening much broader interest in this topic over the past year, and stimulating regulatory action, has been the emergence and increasing visibility of practices that infringe net neutrality principles, such as the 2014 deal between US carriers Comcast and Verizon with Netflix in the United States, and the rise of non-neutral practices by Indian telecommunication operators such as Airtel. Such deals have provided ordinary Internet users with concrete examples of the effects of ISPs applying discriminatory policies in the access and delivery of specific content across their networks, by accepting payments from content providers to favor the delivery of that content.

This short article will provide some background about the regulatory changes in the United States that were made in the midst of this upswell of public interest, and to draw some comparisons and contrasts with the situation in India, where a similar position now confronts Indian regulators.
The FCC Acts on Net Neutrality in the United States
In March 2014 the United States Federal Communications Commission (FCC) published an order laying out rules for broadband Internet providers operating in the U.S., rules that represent a step towards net neutrality. The new rules apply both to fixed and mobile providers of broadband internet access and include three “bright line rules”: no blocking, no throttling, and no paid prioritization, as well as a general requirement not to unreasonably discriminate or disadvantage particular users, content, applications, or devices, that will be adjudicated on a case-by-case basis. The FCC allowed reasonable non-commercial network management practices that have a primarily technical justification. Network management practices are more likely to be found reasonable if they are transparent and allow end-user control or do not target or favor particular applications.

As a catch-all measure, the FCC prohibits broadband providers from causing unreasonable interference or disadvantage to consumers or “edge providers.” Edge providers are essentially the other parties with whom a broadband customer is communicating over the Internet. The FCC says that it will consider six factors in making a determination on whether conduct is reasonable:

*End-user control
*Competitive effects
*Consumer protection (including unfair or deceptive practices or breaches of privacy)
*Effect on innovation, investment, and broadband deployment
*Free expression
*Application agnostic (not targeting or favoring particular applications)

The order demand increasing transparency from ISP that are required to publicly disclose their network management practices, performance, and commercial terms to an extent sufficient for consumers to make informed choices and for other parties to offer content, applications, services, and devices that work over the broadband provider’s network. ISP have to disclose promotional rates, fees and surcharges, data caps and allowances, packet loss as a measure of performance, and specific notice of practices that are likely to significantly affect customers’ use of the service.

This regulatory action was the culmination of a long and arduous process of democratic discussion around the necessity to regulate and the form in which to do so. The FCC received 1.1 million responses to its public calling to participate in the process. Neither is it over yet, with a spate of lawsuits having rolled out in early April, from telecommunications operators and Internet service providers seeking to have the new rules overturned. Whatever the fate of those lawsuits, a precedent for strong regulation of net neutrality in the United States has been set, and more voices than ever are now engaged on this issue, on one side or the other.
Net neutrality as a global issue
But as Internet access is a concern around the world, so too net neutrality should be a concern for everyone around the world, and increasingly this is the case. In any country in which ISPs block content based on its source or destination, or discriminate against certain applications (such as P2P or video streaming), or impose special access fees that would make it harder for small websites to reach their users, net neutrality rules may be justified to counter these abusive practices.

Indian users are dealing with the just some of these problems, and are worried about what this bodes for the future of the Internet as we know it. For example, the Economic Times has reported that Indian telecom companies have been pushing government to regulate services like WhatsApp and bring them under license. Such regulation would protect their own business from the competition brought by Internet based services.

Considering that ISPs’ business is to charge for the use of their telecommunications infrastructure (that imply high sunk costs to develop), sometimes there is a temptation to justify their actions against net neutrality as an entitlement to share in content providers’ revenues. But a converse case can be made that successful new content distribution models stimulate more traffic from users, making it possible for ISPs to distribute their fixed infrastructure costs among more Internet subscriptions, thereby increasing the return on infrastructure investment (and hopefully allowing for the reduction of tariffs). Internet gatekeepers should not tamper with the disruptive competition between new message and voice applications and traditional MMS or phone calls. Net neutrality regulation has a role to accomplish in preventing that market failure.
Zero rating
Bharti Airtel, India’s largest service provider, has recently launched a new “open marketing platform” branded Airtel Zero, designed to let customers access mobile applications “free of charge,” replicating similar programs that have rolled out across other regions including Africa and Latin America.

Although anything free seems an “offer you can’t refuse” at first sight, the hidden cost of such programs is that for those users with limited Internet access to the applications selected by their ISP, this “walled garden” will become for them a substitute for the open Internet, impeding them from any exploration for new content or services beyond those pre-screened and approved by the ISP. Programs of sponsored data where the content provider pays for the users’ free access pose a particular threat for nascent Indian Internet companies that will not be able to pay the telecom companies what is required to reach those users who do not have a data plan.

A slightly different case is that of zero rating without payments and without exclusivity, as offered for some non-profit content providers as Wikipedia. Considering the persistence of the digital divide, Wikipedia has argued that some form of access is better than nothing, and should not be regarded as infringing net neutrality principles. But what precedent does this set? In India, where telecom operators are adding around 14-15 million users per quarter, or at least 60 million a year, will the next 200 million users have the ability to go beyond their walled gardens? Or will they be second class Internet users?
An Indian response to the problem
We recognize that net neutrality regulation is a domestic issue and that there is not such a thing as one size fits all regulatory approach. The U.S. regulation could be useful as a reference, but the U.S. also has a very particular set of economic, geographical, historical and competitive circumstances that have shaped its approach. By the same token, the correct approach to take in addressing net neutrality in other countries will vary based on its circumstances.

For example, countries like Japan, the Netherlands and Canada already have open access policies that require competitors to share access to network infrastructure on fair terms. In some cases (such as Australia, Sweden and Singapore) this has been accompanied by functional or structural separation of the dominant telecommunications operator, and/or by significant public funding for a national broadband network.

India is a unique case again, but the case for the adoption of a narrow, targeted open Internet regulation that can more effectively the target abuses that occur under the current law is becoming more compelling in view of recent adverse moves from Indian telecommunications companies, some of which were highlighted above.

Through the massively successful portals savetheinternet.in and netneutrality.in, members of the Indian Internet community have emerged in large numbers users to express their concern about how a non-neutral Internet could favour deep-pocketed incumbents over startups and noncommercial content providers, and thereby impede the development of local content, new business models and freedom of expression.

They have expressed their views on these important public policy issues by their contribution of a flood of responses to the white paper on net neutrality that was issued by the Telecom Regulatory Authority of India (TRAI) in March 2015. With our experience of a similar fight in the United States, and in the hope of a similar outcome, EFF will be watching developments in India with much interest.

The promise of net neutrality is to maintain an open playing field that will allow the next Facebook, WhatsApp, YouTube, Spotify, Wikipedia or Amazon to arise in India (or any other country), rather than reserving a privileged place for large incumbent players. Supporting net neutrality is to support an inclusive Internet, that allows the next billion Internet users the same privileges that the first billions have enjoyed. Our wish is that access to the open Internet will be preserved as more and more users from the world’s largest democracy come online.

Views expressed here are personal


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