Facebook, COAI rue TRAI's regulation on differential pricing

Facebook is disappointed, while the COAI says telcos will lose revenue because of TRAI's regulations on differential pricing.

Published Date
08 - Feb - 2016
| Last Updated
08 - Feb - 2016
 
Facebook, COAI rue TRAI's regulation on differential pricing

Facebook is disappointed with TRAI’s decision on differential pricing. The social network giant though stated that it will continue its efforts with Free Basics. A Facebook spokesperson said, “Our goal with Free Basics is to bring more people online with an open, non-exclusive and free platform. While disappointed with the outcome, we will continue our efforts to eliminate barriers and give the unconnected an easier path to the Internet and the opportunities it brings.”

Further, Rajan Mathews, Director General, Cellular Operators Association of India (COAI), in a conversation with Digit, expressed his disappointment over the ruling, saying, "We are obviously very disappointed with the ruling. We will have to look into the recommendations, but I don't understand claims on how this negatively impacts consumers or stifles innovation." Mathews added, "We have clearly jumped the gun on differential pricing. We should have first taken a decision on Net Neutrality like the US and then decided on the issue of differential pricing." Rajan said the COAI will have to look into whether the ruling will be a major impediment to business. He noted that while the ruling "obviously impacts operators financially, it will also impact the signing up of new customers, since most of them are attracted to such plans." Mathews stated that TRAI's ruling would also have an impact on connecting those who are currently unconnected, which is the Prime Minister's agenda. Lastly, Mathews noted that "the PMO panel is most likely to concur with the regulator". He said that while the government can ask TRAI to revoke the ruling, it is unlikely to do so, since there will be "huge hue and cry about the regulator not being independent".

The Telecom Regulatory Authority of India (TRAI) today ruled against differential pricing, stating, “No service provider shall offer or charge discriminatory tariffs for data services on the basis of content.” TRAI wrote that allowing such plans would affect the architecture of the Internet and hence they wouldn’t be allowed. The statement says, “Prohibition of discriminatory tariff is necessary to ensure that service providers continue to fulfill obligations in keeping internet open and non-discriminatory.”

While Facebook is disappointed about the decision, proponents of net neutrality, like Rajeev Chandrashekhar, Member of Parliament, Rajya Sabha, congratulated TRAI, saying, “Further to Telecom Regulatory Authority of India (TRAI) issuing a regulation in favour of net neutrality ruling against differential pricing, as a person working closely on this issue, I personally think that this is a big win for Indian consumers & Net Neutrality. Congratulations to TRAI and R.S. Sharma for standing up for consumers. This is a very powerful and positive first step taken by TRAI. The days of telcos controlling regulations and regulatory policy is over and it’s consumer to the fore.”

Chandrashekhar though, in an interview with CNBC-TV18, noted that there are still issues that need to be addressed and resolved in order to achieve true net neutrality in the country. He added that there are certain powers that TRAI doesn’t have, which means it can not ensure consumer protection when issues pertaining to the same come up. He said that the government either needs to give TRAI those powers or step in itself.

With inputs from Adamya Sharma

Prasid BanerjeePrasid Banerjee

Trying to explain technology to my parents. Failing miserably.