Highlights and impact of Net Neutrality recommendations by TRAI

Ofcom and broadband speed in UKTelecom Regulatory Authority of India (TRA) headed by its chairman RS Sharma on 28 November released its recommendations on Net Neutrality.

Interestingly, the Federal Communication Commission (FCC) headed by Ajit Pai is redrawing its Net Neutrality guidelines for the U.S. telecom market. FCC chairman Ajit Pai already announced that the current net neutrality guidelines announced during President Barack Obama’s tenure is not suitable for the wireless industry and Internet consumers.

TRAI said the terms of various license agreements governing the provision of Internet services in India (UL, VNO license, UASL and CMTS) should be amended in order to incorporate the principles of non-discriminatory treatment of content by Internet Access Services along with the appropriate exclusions and exceptions.

The above guideline will put pressure on telecom operators such as Bharti Airtel, Idea Cellular, Vodafone, Reliance Jio, BSNL, etc because they cannot offer any differential treatment to content companies including niche video companies.

CARE Ratings said the acceptance of net neutrality will provide no relief to the regulated telecom industry. The proposed guidelines on net neutrality will provide minimal scope to the telcos to offer differentiated access options.

TRAI kept the OTT players outside the scope of net neutrality recommendations while telcos wanted them to be brought under the regulatory framework. Resultantly, the OTT players will continue to have an impact on the telcos’ revenues.

TRAI said a licensee providing Internet Access Service shall not engage in any discriminatory treatment of content, including based on the sender or receiver, the protocols being used or the user equipment.

The Licensee should be prohibited from entering into any arrangement, agreement or contract, by whatever name called, with any person, natural or legal, that has the effect of discriminatory treatment of content.

TRAI is silent about the penalty to erring telecom operators. This will give more space for telecom operators to sign content promotion plans with certain content companies and promote their content on Internet.

TRAI said Internet Access Service is a service to access the Internet that is generally available to the public and designed to transmit data to and receive data from all or substantially all endpoints on.

Net Neutrality timeline

19 Jan 2015 Committee established by DoT to provide recommendations on net neutrality

27 Mar 2015 TRAI’s consultation paper on regulatory framework for OTT services

May 2015 Release of DoT committee report on net neutrality

9 Dec 2015 TRAI’s consultation paper on differential pricing for data services

8 Feb 2016 TRAI’s regulation on prohibition of discriminatory tariffs for data services

3 Mar 2016 DoT sought TRAI’s recommendations on net neutrality

19 May 2016 TRAI’s consultation paper on free data

30 May 2016 TRAI’s pre-consultation on net neutrality

19 Dec 2016 TRAI’s recommendations on provisioning of free data

4 Jan 2017 TRAI’s consultation paper on net neutrality

Internet, according to TRAI, is any service that offers capabilities that are incidental to or provide the functional equivalent of Internet Access Services, shall also be included within the scope of this definition.

Net Neutrality guidelines have always impacted the business plans of telecom operators. Mobile service providers say that they will ensure uniform Internet speed to all their users and will not offer any special treatment to some content companies as Facebook or YouTube or Netflix.

TRAI said IoT should not be specifically excluded from the scope of the restrictions on nondiscriminatory treatment. Those critical IoT services, which may be identified by DoT as satisfying the definition of specialised services, would be automatically excluded.

CDNs should not be included within the scope of any restrictions on non-discriminatory treatment, which are designed specifically to cover the providers of Internet Access Services.

TRAI has recommended that the Department of Telecom (DoT) may establish a multi-stakeholder body with framework for collaborative mechanism among the stakeholders including consumers, ISPs, TSPs, content companies, etc.

Industry response

NASSCOM said TRAI’s recommendations will promote equitable access to the internet for every citizen. It would ensure a level playing field for IT and OTT services providers to innovate and customize in India and provide a constantly expanding range of new services relevant to every individual.

Internet Association of India (IAMAI) said the TRAI recommendations recognize the requirements of expansion of digital services in the country. By preventing larger content / service companies stonewalling emerging services by colluding with ISPs, TRAI recommendations ensure level playing field in access enabling emerging service providers to reach out to target audiences at same terms with their peers.

Baburajan K