"Net neutrality" has been trending in the social media for quite some time. Thanks to Facebook's aggressive courting of even the main stream media in the last few weeks (with full page ads, Op-eds by Mark Zuckerberg himself et al), the matter has suddenly acquired an even higher profile. As is usually the case with anything digital, acronyms and jargons have taken over the discourse - data discrimination, Freebasic.
It would be useful to look at what the issue really is, and which side of the divide makes more sense.
As of today, access to internet requires subscription to a data plan from a telecom company (telco). Data plans typically are more expensive than vanilla voice plans, though the pricing has been coming off steadily.What Facebook is proposing in partnership with Reliance Communication (RCom) is a "limited access" concept. In this, accessing FB will be free, ie, a subscriber without a data plan would be able to access FB. According to FB (and others on its side of the debate) argue is that this would enhance internet access to people who cannot afford expensive data plans. FB claims that this would increase the pace of internet penetration in India by 50%.
Naysayers on the other hand have two basic objections. One, it violates the concept of "net neutrality", ie, all internet sites should be equally accessible. And two, free FB messenger (say) through RCom will restrict growth of newer, disruptive messenger apps as both FB and RCom would/could act as gatekeepers preventing access to the latter through expensive data. Andy Mukherjee, the Bloomberg columnist has weighed in with the objections quite well in a Livemint article today.
http://www.livemint.com/Opinion/elkKQzTLVAru6wKc44OUMN/Mark-Zuckerbergs-Internet-gift-to-India-looks-like-a-trap.html
I think the issues are twofold.
The first is a philosophical question. And that is simply whether data (internet) is a free commons (like air, sunlight) or a scarce natural resource (like coal, oil). The fact is that the decision on this question has already been taken. Bandwidth has been defined as a natural resource and the government auctions the same for a lot of money. Given the general acceptance of this approach, the society wants to treat internet as commercial consumer service.
The second question therefore is, what should be the regulatory approach towards this service? Coverage, or neutrality? to me its a faux divide.Taking instance from other utility and consumer services, the evidence is actually very strong in favour of differential pricing strategies (of the type advocated by FB) leading to enhanced coverage. Even utilities that are natural monopolies like power distribution, have expanded coverage through differential tariffs. On the other hand, utilities subject to intense competition have shown even better results. None better than telcos on voice telephony, where differential tariffs based on user groups, specific services (like toll free), usage duration and a lot more have made telephony cheaper and enormously helped coverage.
The scenario today is the following - when I surf www, whether I log on to FB or Google or MSN, I pay as per my data plan. A chap who cant afford the data plan is not on www today. Tomorrow, my telco would offer a plan that would make accessing FB free. Will that increase my time on FB? Very unlikely. But that certainly would pull the other chap into www, even if only for FB (and such other "sponsored" sites). Will that increase data tariffs on X-subsidisation? Given the intense competition in the space, virtually unlikely.
Which brings us to the question of neutrality, or access. That is NOT a commercial question, left to RCom or FB. That is a regulatory responsibility. As long as the regulator ensures that RCom is obliged to provide me as speedy an access to MSN messenger as it does to FB messenger, even if it is for a price, anything else doesnt matter. New apps will have the same opportunity to disrupt FB from the "paying customer" population that they have today. Technically, the free internet users accessing FB arent even a customer base for anyone today, hence net net (as they say in banking), it doesnt matter.
This leaves a last, somewhat disturbing point to address. And that is a fear that somehow free access to some sites/apps will "hook" the poor to the internet, and they will start spending money on other, "non-free" sites/apps to their own detriment. This betrays a liberal condescension for the ability of poor to make rational judgements. Not very different from saying that if you give the poor money (instead of subsidy) they will blow it up on alcohol and marriages. As an axiom, this has been debunked time and again (Esther Duflo/Abhijit Banerjee's Poor Economics is a good source of the data).
We should not let class divides come in the way of digital inclusion and exacerbate the digital divide.
It would be useful to look at what the issue really is, and which side of the divide makes more sense.
As of today, access to internet requires subscription to a data plan from a telecom company (telco). Data plans typically are more expensive than vanilla voice plans, though the pricing has been coming off steadily.What Facebook is proposing in partnership with Reliance Communication (RCom) is a "limited access" concept. In this, accessing FB will be free, ie, a subscriber without a data plan would be able to access FB. According to FB (and others on its side of the debate) argue is that this would enhance internet access to people who cannot afford expensive data plans. FB claims that this would increase the pace of internet penetration in India by 50%.
Naysayers on the other hand have two basic objections. One, it violates the concept of "net neutrality", ie, all internet sites should be equally accessible. And two, free FB messenger (say) through RCom will restrict growth of newer, disruptive messenger apps as both FB and RCom would/could act as gatekeepers preventing access to the latter through expensive data. Andy Mukherjee, the Bloomberg columnist has weighed in with the objections quite well in a Livemint article today.
http://www.livemint.com/Opinion/elkKQzTLVAru6wKc44OUMN/Mark-Zuckerbergs-Internet-gift-to-India-looks-like-a-trap.html
I think the issues are twofold.
The first is a philosophical question. And that is simply whether data (internet) is a free commons (like air, sunlight) or a scarce natural resource (like coal, oil). The fact is that the decision on this question has already been taken. Bandwidth has been defined as a natural resource and the government auctions the same for a lot of money. Given the general acceptance of this approach, the society wants to treat internet as commercial consumer service.
The second question therefore is, what should be the regulatory approach towards this service? Coverage, or neutrality? to me its a faux divide.Taking instance from other utility and consumer services, the evidence is actually very strong in favour of differential pricing strategies (of the type advocated by FB) leading to enhanced coverage. Even utilities that are natural monopolies like power distribution, have expanded coverage through differential tariffs. On the other hand, utilities subject to intense competition have shown even better results. None better than telcos on voice telephony, where differential tariffs based on user groups, specific services (like toll free), usage duration and a lot more have made telephony cheaper and enormously helped coverage.
The scenario today is the following - when I surf www, whether I log on to FB or Google or MSN, I pay as per my data plan. A chap who cant afford the data plan is not on www today. Tomorrow, my telco would offer a plan that would make accessing FB free. Will that increase my time on FB? Very unlikely. But that certainly would pull the other chap into www, even if only for FB (and such other "sponsored" sites). Will that increase data tariffs on X-subsidisation? Given the intense competition in the space, virtually unlikely.
Which brings us to the question of neutrality, or access. That is NOT a commercial question, left to RCom or FB. That is a regulatory responsibility. As long as the regulator ensures that RCom is obliged to provide me as speedy an access to MSN messenger as it does to FB messenger, even if it is for a price, anything else doesnt matter. New apps will have the same opportunity to disrupt FB from the "paying customer" population that they have today. Technically, the free internet users accessing FB arent even a customer base for anyone today, hence net net (as they say in banking), it doesnt matter.
This leaves a last, somewhat disturbing point to address. And that is a fear that somehow free access to some sites/apps will "hook" the poor to the internet, and they will start spending money on other, "non-free" sites/apps to their own detriment. This betrays a liberal condescension for the ability of poor to make rational judgements. Not very different from saying that if you give the poor money (instead of subsidy) they will blow it up on alcohol and marriages. As an axiom, this has been debunked time and again (Esther Duflo/Abhijit Banerjee's Poor Economics is a good source of the data).
We should not let class divides come in the way of digital inclusion and exacerbate the digital divide.
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