Current Public Administration Magazine (January - 2016) - Internet power to the people

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Information & Communication Technology

Internet power to the people

The regulations issued by the Telecom Regulatory Authority of India (TRAI) barring differential pricing of data based on content have created a global impact. A friend, who runs a major international software company, called it the most important victory for the people in the tech space in the last 20 years. India has joined a select few countries that have protected net neutrality and barred zero-rating services.

What makes this “victory” even more surprising was the complete asymmetry of the two sides involved. On one side was Facebook, a company whose market cap is greater than the GDPs of 144 countries, allied with a bunch of big telecom companies (telcos). They had already “won” easy victories for their platform in a number of countries, and felt India would be no exception. They had an ad campaign that estimates put at Rs.400 crore. On the other side was a motley group of free software and Internet activists, with unlikely allies such as comedy group AIB, a bunch of start-ups, and some political figures and formations.

The argument that Facebook was using appeared simple. Why should anybody deny the poor getting some access to the Internet — even if this was limited? Isn’t something better than nothing? Mark Zuckerberg not only wrote articles terming his opponents “Net Neutrality fundamentalists”, but also appeared in advertorials in the electronic media to push Free Basics. Some commentators wrote plugs for Facebook in the guise of opinion pieces, all more or less posing different variations of the broad theme that Zuckerberg’s heart beats for the Indian poor.

To beat back such an offensive, backed by the full power of Facebook’s media blitz, was no ordinary event. So why did Facebook’s campaign fail?

People’s campaign prevails

First is, of course, the energy and the creativity of the groups fighting Free Basics. They not only ran an innovative and creative campaign, but were also able to bring tech activists on to the streets. What surprised even them was the response of the people.

I am convinced that Facebook and their ad agencies completely underestimated the Indian public. Even if all of them do not use the Internet, they understand the difference between having access to the full Internet, with nearly a billion websites, and the so-called Free Basics platform that provides Facebook and a few other sites. They are sophisticated enough to know that Free Basics would not offer them any of the things they really want to access. No search, no email, no access to various services; no pictures or video clips for entertainment either. No access to the rich diversity of views and material on the Internet. Only a sterile walled garden where, at best, you can see what your friends are doing.

A level playing field

What is the flip side of such a platform? Other people who want to have the full Internet could still access it, so why is Facebook’s Free Basics harmful?

TRAI has correctly pointed out that the tariff principle at play is whether we can have differential pricing of data based on the content we see. If we accept this principle, what then prevents telcos from charging various websites and Internet services for accessing their subscribers? Accepting that one form of price discrimination is okay opens the door to all other forms of discrimination as well.

This is where Net Neutrality comes in. The most important characteristic of the Internet is whether it is the richest corporation in the world or an individual writing a blog, both are treated identically on the Internet. If the blogger had to negotiate with the Internet service providers (ISPs) — in today’s world the telcos — to reach the telco subscribers, she would have to negotiate with thousands of such ISPs. Telcos would then be the gatekeepers of the Internet. Only the biggest corporations could then survive on the Net. This is how the cable TV model works; for their channels to be carried, the TV channels have to negotiate with all the platforms such as Dish TV, Tata Sky, etc. If we accept that telcos can act as gatekeepers, we would then lose what has given the Internet its unique power, the ability for us not only to be consumers but also creators of content.
In its nascent phase, the big telco monopolies tried to levy a “tax” on all Internet content providers. The Internet companies were then the new kids on the block. They and the Internet user community fought back such attempts. This was the first net neutrality war, and it established the principle of non-discrimination on the Internet between different types of content or sites.

The scenario has changed dramatically today. We have the emergence of powerful Internet monopolies that are much bigger than the telcos. Not surprisingly, these companies now see the virtues of monopoly. They would like to combine with telcos to create monopolies for their platforms, ensuring that they control the future of the Internet and freeze their competition out.

Today, we have nearly a billion websites on the Internet and 3.5 billion users. This means that nearly one out of three users is both a content provider as well as content consumer. What the Internet monopolies want is that we should be passive consumers of their content, or at best generate captive content only for their platforms. This is why they have joined hands with telcos to offer various forms of zero-rating services.

Future-proofing policies

The two most common forms of zero rating used by telcos are (a) no data charges for a select set of sites, e.g. Facebook’s Free Basics, and (b) a few content providers such as Netflix not being subjected to data caps by telcos. The TRAI order bars both these forms.

The other issue that TRAI dealt with is whether regulatory policies should be crafted to prevent harm ( ex ante ) or be applied only after harm has been established. The argument of the telcos has been, “prove there has been harm, otherwise we should be allowed to do as we please”. TRAI has again correctly pointed out that not crafting the right policies for the Internet would distort the basic character of the Internet itself. It would then help the well heeled, who would be able to take advantage of a lack of policy. The TRAI order also points out that without the right policies, each tariff proposal would have to be analysed on a case-by-case basis, imposing high regulatory overheads.

The last issue we need to examine is how a powerful monopoly can bend policy by virtue of its control over its users. Facebook not only launched a media blitz but also ran a completely misleading campaign on Free Basics to its 130 million Indian subscribers. Through its various pop-ups and user interface, it pressured its users to send TRAI a boilerplate statement of support for Free Basics. It even painted this as providing basic Internet to the poor, without informing its users that Facebook was the sole arbiter of what constitutes a basic Internet.

The question is, can a platform monopoly — of the type Facebook, Google are — use this monopoly to run a campaign on a country’s policy? Facebook is a foreign entity and has argued before Indian courts that it is not accountable to Indian laws. Should such entities have such power over our peoples’ lives?

A media company is supposed to differentiate between advertisements and news. Facebook did not identify its plug for its Free Basics platform on Facebook as opinion but presented it as truth. How should online media conduct itself in the future on such issues?

TRAI had rebuked Facebook on its attempt to convert TRAI’s consultation on differential pricing to a numbers game. TRAI wanted clear answers to the questions they had posed, not boilerplate emails saying how people loved Free Basics. But it still leaves unanswered the question of what are the rights and duties of such platform monopolies towards their users. With Google and Facebook emerging bigger than many nation states, this is the key question for the Internet in the future.

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