1. Free data in rural areas: Trai proposal could violate Net neutrality

Free data in rural areas: Trai proposal could violate Net neutrality

The Trai proposal seems a good move, but could violate net neutrality

By: | Published: December 24, 2016 6:17 AM

Less than a year after the government banned Airtel Zero and Facebook’s Free Basics for violating net neutrality provisions, Trai has recommended an aggregator model to provide rural smartphone users with 100MB of free data a month. It examined three possible models—a ‘reward’ model where recharge for data usage is provided as a reward through a TAP-agnostic model, a ‘toll-free’ one and a direct money transfer one as is being done for LPG, and chose the aggregator model. Out of India’s 367 million broadband users, 32.6% are in rural areas—the rest of the population has limited access to the internet. The plan will provide internet connectivity to 50 million rural smartphone users and entails an annual expenditure of R600 crore. The price per subscriber—at R10 per per month—is expected to fall as data prices fall over the next few months. Under this, apps such as Gigato which allow partner websites to refund users for data consumed on their apps will be allowed to strike deals with telecom service providers—however, they cannot strike exclusive alliances with TSPs. Trai believes that the amount to be paid to the TSPs could be easily funded out of the R47,167 crore lying with the Universal Service Obligation Fund (USO Fund).

The irony is that despite all the net neutrality noise, the Trai recommendation does very little for small content providers who would have lost out to an Airtel Zero or Facebook Free Basics. There is every likelihood that aggregators could create a high entry-barrier for them. Trai wants aggregators to be registered under the Indian Companies Act, 1956. It is early days yet as far as the Indian net neutrality debate goes, but the recommendation is definitely not the ideal solution in a complex market.

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