TRAI (Telecom Regulatory Authority of India) has ruled against differential pricing for data services in a major support to Net Neutrality. The TRAI ruling will be a major blow to Facebook’s Free Basics, Airtel Zero and other similar data services.
Keeping in view India’s large number of internet users and content producers, both of which are rising exponentially, the Authority has taken a view that prohibition of discriminatory tariff for data services is necessary to ensure that service providers continue to fulfill their obligations in keeping the internet open and non-discriminatory, TRAI said in their press release.
But there will be a special exemption for emergencies.
Key Takeaways from TRAI order against differential pricing.
- No service provider shall offer or charge discriminatory tariffs for data services on the basis of content.
- Exemption for certain content – A service provider may reduce tariff for accessing or providing emergency services, or at times of grave public emergency: Provided that such tariff shall be reported to the Authority within seven working days from the date of implementation of the reduced tariff and the decision of the Authority as to whether such reduced tariff qualifies under this regulation shall be final and binding.
- If a service provider violates this, a fine of Rs. 50,000 a day will be charged against the service provider.
- TRAI will review these ruling every two-year or on any earlier date if needed.
In a nutshell, TRAI has ruled against differential pricing in order to keep the internet open and non-discriminatory for users. TRAI ruling aims to delink content and discriminatory pricing as some zero-rating platforms had proposed.
TRAI also mentioned that all the stakeholder responses were accounted before arriving at this decision.
Facebook reportedly spent around Rs. 300 crores on billboards and ads promoting Free Basics in India. With this TRAI ruling, Facebook’s free basics is virtually banned in India. Facebook CEO Mark Zuckerberg during his India visit recently talked about the Free basics and their mission to make few websites free of cost and accessible to the world. However critics of Free Basics and zero-rating in general argued that the practice creates an unfair marketplace. By subsidizing content, companies like Facebook get to pick and choose winners, creating incentives for customers to use certain services because they don’t eat into their data. This in turn makes it harder for smaller players to compete and quashes innovation.