In a boost to net neutrality and a blow to Facebook and other operators offering differential data tariffs, telecom regulator Trai today barred them from charging discriminatory prices for web access. “No service provider shall offer or charge discriminatory tariffs for data services on the basis of content,” Telecom Regulatory Authority of India (Trai) Chairman RS Sharma said unveiling the details of the regulations, effective today, titled ‘Prohibition of Discriminatory Tariffs for Data Services Regulations, 2016’. We explain here what it is all about:
What is net neutrality?
Net Neutrality is a concept where content and application providers get equal treatment by telecom operators. There is access to all websites, nothing is blocked, and the speed of access is not differentiated.
What is on offer?
Moves by Reliance Communications and Bharti Airtel to tie up with several websites and application owners would have led to preferential access to their applications and websites, and this would have violated the concept of ‘net neutrality’. While the access and download from the partner app would have become free, industry insiders say that even the speed of downloads from those websites was faster. The partner’s website could also become a user’s first preference by default.
Why did telecom operators and application providers eye such tie-ups?
This would bring additional revenue for the telecom operators. By entering into a partnership, the telecom operators would provide preferential access to the website or application of the provider and, in turn, generate revenue from them.
For the website owner or application provider, this provides them access to millions of customers of the telecom operator, thereby leading to a pick-up in their number of transactions, and ultimately lifting their valuation.
Telecom operators argue that they spend a lot on buying spectrum and building infrastructure, but new applications dent their SMS or call revenues. This is just an additional way for them to monetise the access they can provide.
How does it impact the consumer?
By entering into an exclusive tie-up, the telecom operator provides free access to that application, and the data usage fee for that is paid by the application provider. However, some critics say that this would restrain the customer’s first choice of access to a website. For example, if a telecom operator ties up with one website which has a search engine, then that search engine will automatically become your first preference.