India opts for net neutrality, bars differential pricing

India has elected for net neutrality, banning immediately any differential pricing for data – which means no content can be offered at discounted rates. The decision means that India will not allow Facebook's free internet scheme Free Basics, heavily promoted by Facebook founder Mark Zuckerberg.

Violators will be penalised at Rs50,000 per day, said the Telecom Regulatory Authority of India, stressing that "content agnostic" access to the internet is the operating principle. However, data charges can be dropped during public emergencies like flooding.

"No service provider shall offer or charge discriminatory tariffs for data services on basis of content," Trai said in a statement

Data packs that currently offer discounted rates for some content, such as Airtel Zero as well as Free Basics, will not be yanked and customers can use them till they expire, said the regulator, adding that it is the "convenience of users" that is the over-riding concern.

 Trai said that no service provider shall enter into any arrangement, agreement or contract,that has effect of discriminatory tariffs for data services being offered on basis of content. This in effect disallows subsidised data packages that offer access to only a select services, such as Whatsapp or Twitter, packages which are currently offered by various telcos to attract subscribers.

However, the regulation will not apply to tariffs for data services over closed communication networks, unless tariffs offered evade prohibition of this regulation

Trai also gave service providers six months to comply with the new rules.

The regulator's order is in the form of a regulation which does not need to be cleared by the government.

Trai suspended Free Basics a few weeks ago, arguing that it violates the principle of net neutrality, the concept that all websites on the internet are treated equally. Differential pricing would put small content providers and start-ups at a disadvantage, say critics who launched a massive consumer awareness programme to lobby Trai.

The controversy over Airtel Zero and net neutrality had died down over months but was once again triggered after Trai on December 9 released a consultation paper on differential pricing of data services. It had previous run a consultation process on the need for a regulatory framework for over-the-top (OTT) services in March-April 2015 but its recommendations are still pending in this.

Facebook though has been engaged in a war of words with Trai over responses made through the social networks' platform to the consultation paper on differential pricing of data services.

"While disappointed with the outcome, we will continue our efforts to eliminate barriers and give the unconnected an easier path to the internet," said Facebook in a statement.

Free Basics has been described by Zuckerberg as a way of bringing the internet to millions of Indians in rural India. In partnership with Reliance Telecom, the scheme, which piloted in a few states, allowed users free access to Facebook's own social network and messaging services, along with the content of its partners.

Those who have taken on Free Basics include founders of some of the most successful internet companies in India, as well as faculty at prestigious academic institutions like the IITS. They argue that if the Facebook scheme is allowed, it would confer huge gate-keeping powers on the online giant.