Critically Analyse the impact of telecom companies' demand for Over-The-Top (OTT) services to share in the costs of bandwidth on net neutrality. (250 words)

From Current Affairs Notes for UPSC » Editorials & In-depths » This topic

Introduction

Net neutrality is the principle that Internet Service Providers (ISPs) should treat all data on the internet equally, without any discrimination. It ensures an even playing field on the internet, where all data is treated equally without any bias by ISPs.

Body

Telecom Companies’ Demand: Telecom companies argue that OTT platforms like Netflix, Amazon Prime, and Disney+ Hotstar should share in the costs of bandwidth. They claim that these platforms are free riders, benefiting from the infrastructure built and maintained by the telecom companies. This demand, however, undermines the principle of net neutrality.
Impact on Net Neutrality: The demand of telecom companies to charge both consumers and content providers is not only avaricious but also undermines net neutrality. If OTT platforms were to acquiesce to the demands of the telcos, the incurred costs would trickle down to subscribers, either through increased subscription fees or degraded service quality for those platforms unwilling or unable to pay the toll.
Consumer Impact: This outcome can only be detrimental to consumers who have come to rely on OTT services for entertainment, education, and professional pursuits. It would lead to increased costs for consumers and potentially lower quality of service.
Regulatory Scrutiny: Any attempt to seek cross-subsidies instead of fully accounting for the costs could warrant scrutiny from the Competition Commission. It is essential to maintain a separation of costs between these two markets to ensure fair competition.

Conclusion

The demand of telecom companies for OTT services to share in the costs of bandwidth is a threat to net neutrality. It is crucial for all stakeholders, including policymakers, to recognize the long-term ramifications of acquiescing to these short-sighted demands.

Learn More

Net Neutrality: The principle of net neutrality was largely credited to Columbia Law School professor Tim Wu, who coined the term in a 2003 paper titled “Network Neutrality, Broadband Discrimination.” It draws from earlier notions and principles concerning common carriage, which posit that service to all customers must be provided on a non-discriminatory basis.
TRAI Regulation: Net neutrality formed the basis of TRAI’s regulation on prohibition of discriminatory tariffs for data services brought out on February 8, 2016. Later, on November 28, 2017, TRAI released its comprehensive recommendations, which have largely guided the adoption of this principle in India.
Global Adoption: Many other countries have also adopted net neutrality, thereafter. The Body of European Regulators for Electronic Communications (BEREC) and TRAI adopted a Joint Statement for an Open Internet on June 14, 2018, later reaffirmed in 2020.
Importance of Net Neutrality: Upholding the principles of net neutrality is not merely about preserving the ethos of an open Internet but is also intrinsic to fostering a conducive environment for innovation, competition, and consumer welfare, especially in countries such as India where the Internet is going to be the carrier of all Digital Public Infrastructure (DPI).

Reference: The Hindu – The cult of operational superiority, from Israel to India