Since November 2022, the Cellular Operators Association of India (COAI), which represents Bharti Airtel, Vodafone Idea and Reliance Jio, the three major telecom operators in India, has been demanding that platforms like YouTube and WhatsApp pay a share of the revenue to offset network costs. This has reignited the net neutrality debate.
In an immediate response to the call, the Broadband India Forum (BIF), which represents internet companies like Meta and Google, wrote a letter to the Department of Telecommunications (DoT) dismissing the COAI’s claims.
“This concept of paying to use infrastructure is an excellent concept where any entity using another entity’s infrastructure should pay for it,” wrote Debashish Bhattacharya, senior deputy director of BIF. “But the infrastructure provider earns the income [telecom operators] should also be shared with the legal entity that uses them in the same proportion.”
Mr Bhattacharya also hit out at telecom operators’ apparent claim that content providers would not build this infrastructure themselves. “The infrastructure for any communication network also includes data centers, submarine cables, content hosting centers, content delivery networks (CDNs), etc. – all built by the OTT platforms,” he said.
In 2016, internet activists celebrated when the Telecom Regulatory Authority of India (TRAI) ruled in favor of net neutrality, the concept that all traffic on an internet network must be treated equally.
The telecom regulator ended a high-profile debate on the issue, concluding that programs like Facebook’s (now Meta) Free Basics and telecom operators’ plans to charge additional fees for data calls with apps like Viber would be banned, be priced the same as was the case for all Internet access.
In 2018, the Department of Telecommunications embedded the concept of net neutrality in the Uniform License, the terms of which all telecommunications operators and internet providers are bound by.
The case for a fee
The COAI argues that their current request has nothing to do with net neutrality. “It seems there is [a] lack of recognition of the fact that net neutrality concerns the non-discriminatory treatment of content unrelated to the issue of user fees,” argued the COAI in a February 27 press release.
“We reiterate that all our member TSPs [telecommunication service providers] are committed to complying with the principles of net neutrality under their license terms,” said Lieutenant General Dr. SP Kochhar (retd), Director General of COAI.
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Last Monday, Amrita Choudhury, director of CCAOI, a cyber-advocacy-focused public policy agency, wrote: “Network charging will destroy the core of the open internet.”
Telecom operators and platforms “support each other’s growth and neither can exist without the other”.
Ms Choudhury argued the government could instead cut spectrum fees and support telecoms companies with the Universal Service Obligation Fund (USOF).
Net neutrality activists (as well as content providers) have argued that charging such a fee, even for a limited number of large players, represents a distortion of the Internet architecture, in which content providers and telecom operators maintain a symbiotic relationship without burdening one another. and users pay both in the form of fees or advertising, or both.
The debate takes us back a decade to the call for user fees in India by Airtel CEO Sunil Bharti Mittal, who in 2013 called the proposal an “internet tax” and complained that content providers were “consuming a tremendous amount of resources our website uses network” and that “someone has to pay for it”.
In essence, telecom operators have gone from demanding payment for managing scarce resources on their networks to demanding payment for massive use of their networks.
Telecom operators in the European Union also charge similar usage fees to content providers. The Electronic Frontier Foundation (EFF), a prominent advocacy group for internet rights in the US, warned against such moves.
“Basically, network usage fees are a ploy by the largest ISPs to earn monopoly rents, eliminate competition and further consolidate their monopoly power,” the EFF said in a blog post in December. “…The costs incurred by ISPs to provide the traffic have not increased drastically despite the increase in traffic.”
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The EU is holding consultations on this issue this year before finalizing its position. Electronics and Information Technology Minister Ashwini Vaishnaw indicated that the Union government will wait and see what the international movements are in this area before responding to the telecom companies’ demands. “Telecoms is an industry where everything is compared to the world,” Mr. Vaishnaw said in February. “Everything we do will be in sync with global trends.”
In 2014, in the US, where the net neutrality movement was largely taking hold, it wasn’t about the prices consumers were paying. Rather, it came after telecom operators tried to get companies like Netflix to pay them for the massive amounts of traffic they were pouring into their networks.
The US had and continues to have programs like T-Mobile Binge On, where traffic from certain content providers is “zero-rated,” meaning it doesn’t count towards users’ data limits.
In the years since, the Indian telecom industry has far surpassed the US in terms of monthly data consumption on mobile internet connections, owing to the sharp drop in tariffs following the launch of 4G services by Reliance Jio. Now Indian telecom operators are mimicking the approach that American carriers aggressively pursued a decade ago.