Indian telecom service providers such as Bharti Airtel, Idea Cellular, Reliance Communications, Vodafone, Aircel and Telenor have asked TRAI to allow them to fix differential data tariffs for their mobile subscribers.
TRAI feels that differential data tariffs will be against the concept of Net Neutrality.
India, the second largest telecom market, ranks 131st in fixed broadband penetration and 155th in mobile broadband penetration despite being the 10th largest economy of the world in terms of GDP. This positioning is below than some of India’s neighbouring countries like Bhutan and Sri Lanka.
7 percent of Indians have access to broadband internet. More than 300 million Indians access wireless internet. Most of the 2G users have limited consumption like 1 to 100 MB per month. Only 75 to 100 million customers have access to high speed broadband. 700 million have never connected to Internet.
The following is the highlight of response from some of the telecom network operators to TRAI (The Telecom Regulatory Authority of India).
Bharti Airtel says differential data tariffs encourage innovations. Pricing flexibility is a core tenet of marketing and innovation. The differential pricing or marketing innovation is critical for the growth of data services. TSPs should continue to have the flexibility to offer a variety of packages to consumers.
Internet access cost needs to be low enough for its adoption by the masses. Differential pricing allows the telecom operators to create the suitable / targeted tariff packages which suit the need of various types of users and hence, such differential tariffs should be continued.
Some of the telecom markets which have encouraged differential tariff plans/STVs are Singapore, Hong Kong, Thailand, Malaysia, New Zealand, UAE, Bangladesh, and Philippines.
There is differential pricing in all industry segments.
Idea Cellular supports the principle of tariff forbearance practiced by the TRAI. There is no business case for telecoms to offer free data services for any platform or program. The same is apparent by the fact that most major telecom service providers in India have chosen to distance themselves from such programs.
Zero rated plans may be essential in India’s journey towards Universal Internet Adoption. Telecoms can provide their distribution reach especially in hinterlands and deep interiors to promote and support young mushrooming digital startups in the country.
There is a need to kick-start programmes that would accelerate Internet acceptance and reach amongst unconnected populace.
Data tariffs should be kept under forbearance permitting the TSPs to price their data services as per the market dynamics. TRAI should allow the offering of differential pricings within the scope of the existing regulations itself. Imposition of any further regulations on data services will only distort the market and could be to the detriment of the end users.
Telecoms should have the freedom of developing and promoting their own websites / apps as a value add to their services on their own network. It is felt that the same should be permitted as a legal business practice. TRAI should allow the TSPs to continue with their data tariff offerings based on the market dynamics and innovations.
The competitive intensity of the Indian telecom market has resulted in largely self-regulatory mechanisms that have ensured the protection of consumer interests and have in fact created various innovative tariff offerings for consumers, all of which have significantly contributed in making the Indian telecom market one of the most competitive, innovative and affordable markets in the world.
There should be no element of compulsion in differential offerings nor any blocking or throttling. Even the US Regulator “Federal Communications Commission” (FCC) vide its Internet Order dated 26.02.15 has noted that data sponsored schemes in some instances provide benefits to consumers, increases their choice and lower the costs. Considering this, FCC has decided to look at and assess such practices under the no-unreasonable interference/ disadvantage standard, based on the facts of each individual case, and take action as necessary.