1. Net neutrality: Yes, but not yet

Net neutrality: Yes, but not yet

We must have a roadmap for affordable tariffs for the poor and those living in distant areas. Else, like in telephony, we will keep increasing the rural-urban and rich-poor digital divide

By: and | Updated: February 19, 2016 2:21 AM
We must have a roadmap for affordable tariffs for the poor and those living in distant areas. Else, like in telephony, we will keep increasing the rural-urban and rich-poor digital divide

We must have a roadmap for affordable tariffs for the poor and those living in distant areas. Else, like in telephony, we will keep increasing the rural-urban and rich-poor digital divide

Net neutrality is a complex and controversial issue which has led to enormous delays in a final solution in almost all the countries. It is perhaps a very progressive cliche, no one wants to differ till implementation issues come to the fore.

The matter first arose in the US in early 2000s, when Microsoft and Yahoo formed a coalition to have net neutrality enforced against Netflix’s spectrum-guzzling operation which was being transmitted on the fast lane. They wanted the “principle that all electronic communication passing through a network is treated equally” enforced.

Later, around 2006, everyone started predicting that the issue was dead, with Google, Microsoft and Yahoo realising they needed faster lanes for delivering some services. Google started negotiating with a cable company for fast-track lanes. Microsoft and Yahoo quietly withdrew from a coalition formed a few years ago to protect net neutrality.

Yahoo and AT&T entered into a deal with Microsoft providing software for AT&T’s internet TV service. Amazon and Sprint entered into a deal on Kindle digital reading device. It then appeared that the issue will be left to the market.

Yet the matter repeatedly kept springing up, until the US regulator issued a regulation on net neutrality in February 2015 that “an open internet means consumers can go everywhere and demand services, and also innovators can deliver services without asking for permission.” It also meant that spectrum guzzlers like Netflix and Youtube can ride on the internet even during peak hours—adversely affecting the services of others without having to pay anything extra—on the assumption that the consumer has paid for the services on the internet, and none else needs to pay. And if content provider pays, the telecom operator will give him priority. Though the other traffic does adversely gets affected due to heavy users, in theory, ‘net neutrality’ protects it against fast lanes.

Everyone saw problems in traffic management, with the likes of Netflix and Youtube freely riding the internet, consuming more space, and people demanding faster lanes for emergency, premium, spectrum guzzling services.

Hence, three kinds of approaches stabilised. The countries which thought the issue was too complex to legislate on, and often came in direct confrontation with traffic management and decided to watch—like Australia, South Korea and New Zealand. There were other countries which decided on light-handed net neutrality measures—for example, transparency, lowering switching barriers, etc. The countries that came in this category were those in the European Union, Japan and the UK. Then there were the active reformers like Brazil, Chile, France, the Netherlands, Singapore and the US. The cautious or tentative reformers believe that existing telecom and competition laws, with minor tweaks, can deal with the situation. The UK regulator, after examining the matter, only decided to issue six non-binding principles whose compliance the operators must report to consumers. In the UK again, the ISPs issued, with the approval of the regulator, a code of practices. The EU later joined the active reformers league and passed a legislation prescribing net neutrality, as in the US. However, despite legislation, the matter is still under discussion, and not totally implemented. Even in the space of active reformers, perhaps with the exception of Chile, the final net neutrality regime is not in place anywhere, and the orders and issues are being tested in legislature or courts, or are still under discussion.

In India, we have just started our broadband journey, and the density is sub-10%. Trai should have chosen to join the first two categories of countries rather than issue a regulation as in mature broadband category three countries, and then try to sort out numerous problems in implementing net neutrality. Traffic management is a tool used by ISPs to effectively protect the integrity of networks. It is essential for the continuous delivery of certain time-sensitive services such as voice communications or video-conferences that may require prioritisation of traffic for better quality. In India, the integrity of the internet is already under threat with totally inadequate spectrum allocation, and should not have been put to more pressure at this stage.

However, there is a fragile balance. What does Trai regulation do? On the face of it, the order ensures that, irrespective of content, free access to all sites at non-discriminatory prices will be provided. The real-life situation is not that simple. Network bandwidth generally and in India particularly is quite restricted (130 MHz, as against 400 MHz requirement assessed by Trai for 2014). As a result, if several customers use bandwidth-hogging applications such as video-streaming—as they would with the encouragement of net neutrality—the bandwidth remaining for the balance majority customers will be too limited, resulting in poor or very poor internet experience. Surely, no regulatory step that leads to such a disastrous result can be considered desirable. Thus, non-discriminatory tariff regulation for all kinds of content has major practical implementation issues. It may mean that until the infrastructure becomes very robust—and that cannot happen in a hurry considering the present status—services such as Netflix or Youtube will either have to be restricted or differently priced, again not a desirable solution. The government has recently announced that 150 MHz of spectrum would be auctioned early. The question is, whether DoT will get that spectrum from defence, and whether it will be able to sell it, looking at the network viability of operators and spectrum valuation issues. There have been past failures too. What is then the solution?

Can we have voice telephony-type forbearance in internet tariffs? Let us first look at the 2G experience? We had a revolution in 2G after tariff forbearance, technology neutrality, and lowering of all kinds of charges on the network. Whether similar signals can be generated in broadband network needs much more experience and research. Right now, we only have to concentrate on all kinds of measures to add subscribers. A sub-10% broadband density will not take us to Digital India. We have to concentrate at this stage in getting over spectrum allocation problems, and taking all steps to increase broadband density, and simultaneously research in regulations which also look after traffic management problems.

A word about Facebook’s claim that Free Basics would increase broadband connectivity. Our problem in expanding broadband is the last-mile one, and unless this is tackled—say by giving more free spectrum—broadband will not reach the interior or in poor areas. The National Optical Fibre Network, at its current speed of implementation, will take decades to complete, but will still be dependent on last-mile.

Clearly, the problem today is the last-mile one, and the government does not have a roadmap. The poor subscribers cannot pay around R1,000 monthly of broadband costs, and we must have a roadmap for affordable tariffs for the poor and those living in distant areas. Otherwise, like in telephony, we will keep increasing the rural-urban and rich-poor digital divide. Unless Facebooks or Bhartis show how they would increase broadband density through their proposed schemes, schemes like Free Basics cannot be encouraged.

Pradip Baijal is former chairman, Trai. DPS Seth is former member, Trai, and former chairman, BSNL

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