Story Of The Week

Tryst with Net Neutrality

“If net neutrality goes away, it will fundamentally change everything about the internet”

-James Hilton


Recently the Telecom Regulatory Authority of India (TRAI) has been in news for its adamant stand on net neutrality. TRAI has made it clear that Internet user’s rights will be protected against the strong lobbying by Internet Service Providers(ISP). ISPs cannot discriminate between the users and they can charge only for the speed and quality of the network, irrespective of the content. On 28 November 2017, the TRAI released its recommendations on Net Neutrality. The ruling has made clear that any violations of the rules laid down ensuring net neutrality, will be treated as a violation to license conditions. 

Too many jargons in a few sentences? Let’s break it down.

So what is Net Neutrality?

Let’s think of it this way, when you enter a library you should be able to use any book, irrespective of its content, popularity, and cost. The rules regarding the usage of the books should be identical and fair. The librarian cannot charge you extra for using a specific book or block you from using another, based on his/her whims. This is exactly what net neutrality means. It says that any information stacked away in any website, under any portal should be as accessible as any other. The Internet Service Provider cannot use differential pricing for it. You have to pay for the internet quality and speed, but not for its content specifically.

What are the two sides in this matter?

net neutrality


  • Pro Net Neutrality

The people supporting net neutrality believe that data should be available free of cost and should be easily accessible. The suppliers of the already available information cannot markup the cost of the data. The pro-Net Neutrality side argues that absence of net neutrality can stifle innovation and can block small businesses from competing with the companies with well-established resources and deep pockets.

Another argument supplementing this viewpoint is that absence of net neutrality can hamper data usage by the middle and low-income groups. This model will bolster the rich and squeeze the people living at margins.

Non-profitable organizations working through the internet can face a major set back if transmission of the internet is heavily commercialized.

The ISPs can become price makers and not price takers. The ISPs at best can collude and form a cartel where they decide the price, and at worst they can think short-term and go for aggressive consumer acquisition.  

Free flow of information can choke and prove detrimental to students, researchers, and educators. Giving ISPs a free hand on prices can lead to opportunistic commercialization.

The organizations in favor of Net Neutrality: Facebook, Netflix, Google

They are the content aggregators. Social media platforms and web streaming platforms like Netflix are in favor of net neutrality. Netflix data streaming can get slowed down if net neutrality gets repealed, this would hamper their service delivery. Facebook, however, goes back and forth on its stance of net neutrality. 

  • Anti-Net Neutrality

Suppliers of the internet like AT&T, Comcast, Time Warner, Verizon, and others are generally anti-Net Neutrality. They believe that net neutrality is hampering innovation in the high internet bandwidth consuming companies as there are no incentives. They say that since internet suppliers cannot make substantial marginal profits, there are declining investments.

If the government decides to cut a slack in neutrality, investments in the broadband can accelerate.

Another argument is that if they could charge different prices for different data availability, the delivery can be prioritized. The applications that are vital and heavy on data can be fast-tracked and the routine communications can be taken separately.  

Government intervention in price determination can slow down the development of 5G, which will enable technologies like driver-less cars, robots etc.  

So the crux of the argument presented by the anti-net neutrality side is that such intervention can cripple innovation on the internet.

The organization against Net Neutrality are: Comcast, Time Warner, Verizon

These are Internet Service Providers that provide internet to homes and offices. They invest in infrastructure and service delivery. Net Non-neutrality can help them make good profits and motivate them to make innovation.  

Net Neutrality


How does India come in the picture?

India boasts of over 460 million internet users, second only to China. 25 percent of the population used the internet in 2015 from just 10 percent in 2011. We are growing at a phenomenal rate and there is ample scope for more penetration. With the advent of E-Commerce, E-Banking (courtesy: demonetization), Online Education and social media, IT etc, the need for internet has become vital.

However, as compared to the US, who can somewhat afford net non-neutrality, India has a long way to go. There is a vast population of the country, not using the internet. The penetration is growing but is still quite low. In these circumstances letting ISPs decide the price and priority of data availability can restrain the knowledge flow, that’s essential for a developing economy.


International Perspective

Where India has a stiff stand on net neutrality, countries like the US are still debating and reinventing the system. On June 11 the net neutrality ensuring rules will expire in the US. This has caused an uproar in the country and organizations are divided in opinions.  Companies like Comcast, Time Warner, Verizon have aggressively lobbied with the government to repeal net neutrality and even went to the extent of slowing down the candidate’s website upon non-confirmation of the same.  

Countries like Canada and the European Union have a similar stance to India on net neutrality. They value freely accessible information across the internet and discourage Internet Service Provider to discriminate their consumers based on any device, application, service, or content from running on their respective networks. 

The food for thought we are left with is, what will happen if countries get divided by their stance on net neutrality? How is the going to affect international business? Can this be used as a trade barrier?