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Saturday, 25 April 2015 11:29
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Telcos get together, and pose the right question

With rival telcos finally getting their act together, and commissioning their own social media strategy, the battle has truly been joined—to better the 2 million mails sent to Trai on its net neutrality paper, telcos are targeting 10 million missed calls in their support and have got 2 million already. And at their press conference in the capital, the heads of 6 major telcos including Bharti Airtel,Vodafone and Idea posed the questions rightly to help the government, and Parliament, take the right decision. Since there have been few instances of telcos ‘throttling’ data services or providing ‘fast lanes’, the heart of the net neutrality debate is really cheap Voice-over-Internet-Protocol (VoIP) calls like those offered by Skype and WhatsApp. Though some activists alleged various sites would be blocked and that telcos would charge per Facebook post or YouTube video without net neutrality, the telco CEOs reiterated they were not in favour of any of this, but just wanted ‘same rules being applicable for the same services’—that means Skype also needs to pay a 15% revenue share to the government, has to provide intercepts for the intelligence agencies, and things like that.

The question that the activists raise, and rightly so, is why the telcos continued to charge 50 paise for voice calls when a VoIP call costs 4 paise since even a 15% revenue charge on Skype can’t take its costs to 50 paise. In the initial years when VoIP was allowed, such calls were not possible on mobile networks, but they were after 2010 when 3G services came in. While there are technical issues concerning the efficiency of VoIP and on intercepts for the law enforcement agencies, the real issue, as the telecom CEOs pointed out, is commercial. Telcos, to quote their numbers, have invested R750,000 crore over the past two decades in providing mobile and data services and just 86 million of 1 billion-plus Indians have broadband internet—179 million have narrowband. In order to reach the target of broadband internet for everyone, telcos estimate they need to invest another R500,000 crore over the next 5 years. If VoIP calls are allowed without telcos being able to charge a higher rate for them—that would violate net neutrality rules—the telcos would get badly hit. While that may not be of concern in a competitive world, the question is how this extra R500,000 crore is to be got, and how India’s unconnected are to become digital citizens—hence the Sabka Vikas, Sabka Internet slogan that telcos decided to adopt, marrying the prime minister’s Digital India plan as well as election slogan. And if telcos drop voice call rates to compete with Skype, they will have no option but to dramatically hike data rates. That’s the real equation. At the end of the day, net neutrality is not as much a technical issue as it is a commercial one.

Rahul Gandhi’s demand for a debate on net neutrality suggests he will pose it as a rich versus poor debate, and he will be right in doing so. Except, in this case, it is the other way around. The well-heeled, with broadband internet connections and smart phones, stand to benefit from cheaper VoIP calls while the less well-off, with cheap phones, can’t even access the internet unless more funds are invested in the broadband infrastructure. That is what the government, and Parliament, will have to keep in mind once the Trai gives its recommendations.

 
 

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