Record Cafe: Zero-rated plans can be used to kill innovation, says Vishal Misra

Net neutrality should be a platform where ISPs do not provide an edge to individual apps and services over others. Innovation has happened only because the internet has been free and not discriminated

Record Cafe: Zero-rated plans can be used to kill innovation, says Vishal Misra

Vishal Misra, faculty, Department of Computer Science, Columbia University, is an expert on net neutrality and regulation of the digital medium, with lots of research work in the area. The IIT Bombay graduate, who obtained his PhD from UMass Amherst, has been working in the area of internet economics for the past 7-8 years. His work predicted network neutrality related controversies five years ahead of the very public fight between Netflix and internet service providers in the US. In an interaction with the Express Group journalists, Misra discussed his idea of net neutrality, wherein ISPs should not offer any competitive advantage to anyone on either quality of service parameters or pricing. In short, Misra sees the Airtel Zero kind of platform or that like Facebook’s against the tenets of net neutrality. Excerpts:

How do you define net neutrality and do platforms like Airtel Zero conform to it?

To me, network neutrality is not about how you treat packets but about how you treat competition. It should provide a level-playing field. Net neutrality should be a platform where ISPs do not provide an edge to individual apps and services over others. Innovation has happened only because internet has been free and not discriminated. If you are offering a zero-rating platform, you price something, and by doing that, you give a huge advantage to somebody.

Such an approach is fine in the developed world where internet penetration is full. In developing countries like India, telecom operators have invested hugely in building their network, which provides access to internet. If you tell them that some apps will use your network infrastructure for free to offer voice and data services, it’s like giving services—which took years to develop—to somebody for free. Then who is going to build the network? In the process, internet penetration would suffer. What do you say?

The issue is how are you going to charge from players such as Flipkart or Snapdeal. A zero platform provides access to some who have the money and resources and block others. Players can use this tool to kill innovation as smaller players would need an operator (ISP) to compete in the market. That will kill innovation. Worldwide, telcos have come to a conclusion that they are not in voice but in data segment. Why should there be a difference here. I will give an example. Skype introduced real time language translation. You can talk in language real time! Can Airtel provide services like that. Internet is a very democratic space and we should cherish it. I am all for that.

In many cases, the control, the channel, the pipe … everything is controlled by the same person. Where in the world have you seen this as a good model?

I think the UK is a good model. Nordic countries, South Korea, Japan and others have good net neutrality related laws. In the US, the issue was that theirs was a total flare up with ISPs and lesser competition at the last-mile connectivity. The US has an island of monopoly, which threatened net neutrality. They can afford to do so because their customers have nowhere to go and so they rarely compete. In the US, everyone takes his own last mile and you use that last mile. This model is inefficient.

In India, telcos have no objections to Voice over Internet Protocol (VoIP) for international calls. They do not have objections to messaging on apps such as WhatsApp, but when it comes to domestic calling, they have a problem, because they lose a lot of revenue and can’t compete with over-the-top (OTT) players because they pay license fee and other charges to the government, whereas OTTs don’t pay anything. Shouldn’t there be a level-playing field here?

This is progress. You are paying for data. What happens on top of that is innovation. Telcos are going voluntarily into auctions, buying spectrum and building the network. They are doing this because they are making profits, but there is no guarantee to anything. Tomorrow, any innovation will come and take it away. There are a lot of content providers that are challenging big houses. You need competition and then everything is fine. It should not be prevented. Once the competition enters, the focus increases.

What should then be the role of the regulator in matters relating to net neutrality?

The regulator should be careful to look at where cartels come up. They must prevent anti-competitive things happening and should design laws to ensure that things don’t go out of hand. As a regulator, you must ensure that there is competition. Vertically-integrated services are very dangerous. You are providing a platform and you are providing services. There could be a conflict of interest.

What about managed services? Are these also against net neutrality?

Managed services are fine as they do not discriminate between general consumers, who can be referred to as open customers. So far you are not restricting the bandwidth which you are providing to open customers, there’s nothing wrong with managed services. And ISPs would never restrict the bandwidth to open customers. Pricing has to be fair for a set of consumers who are of a similar category.

Note: An earlier version of this article accidentally misspelled Dr Misra’s name. The error is regretted.

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First published on: 14-08-2015 at 00:31 IST