ITV

Tag: Net Neutrality

  • Facebook’s Mark Zuckerberg disappointed with TRAI’s decision favouring net neutrality

    Facebook’s Mark Zuckerberg disappointed with TRAI’s decision favouring net neutrality

    MUMBAI: Everyone in the world should have access to the Internet says Facebook founder Mark Zuckerberg.

    Voicing his disappointment over Indian regulator – the Telecom Regulatory Authority of India’s (TRAI) decision, which upheld net neutrality and ruled against differential pricing of data services, Zuckerberg took to his social networking website and said, “Today India’s telecom regulator decided to restrict programs that provide free access to data. This restricts one of Internet.org’s initiatives, Free Basics, as well as programs by other organizations that provide free access to data.”

    With an aim to provide basic internet services to all, Zuckerberg launched Internet.org with many different initiatives — including extending networks through solar-powered planes, satellites and lasers, providing free data access through Free Basics, reducing data use through apps, and empowering local entrepreneurs through Express Wi-Fi.

    “While we’re disappointed with today’s decision, I want to personally communicate that we are committed to keep working to break down barriers to connectivity in India and around the world. Internet.org has many initiatives, and we will keep working until everyone has access to the internet,” he added.

    He added that with Internet.org, more than 19 million people in 38 countries have been connected through its different programs.

    “Connecting India is an important goal we won’t give up on, because more than a billion people in India don’t have access to the internet. We know that connecting them can help lift people out of poverty, create millions of jobs and spread education opportunities. We care about these people, and that’s why we’re so committed to connecting them,” he voiced.

    Zuckerberg said that Facebook’s mission was to make the world more open and connected. “That mission continues, and so does our commitment to India,” he said.

    It may be recalled that Facebook faced a lot of flak recently when it asked its users to support Free Basics via a poll. Free Basics has been criticised over grounds that it curbed people’s freedom to access the internet of their choice.

  • TRAI rules against differential pricing for telecom services; imposes penalty of Rs 50,000 per day for offenders

    TRAI rules against differential pricing for telecom services; imposes penalty of Rs 50,000 per day for offenders

    NEW DELHI: In what is clearly a major win for crusaders of net neutrality, the Telecom Regulatory Authority of India (TRAI) has ruled against differential pricing and said no service provider will enter into any arrangement or contract that has the effect of discriminatory tariffs for data services.

    TRAI reserved the right to either ask a service provider to withdraw any discriminatory tariff or impose a penalty of Rs 50,000 per day (subject to a maximum of Rs 50 lakh) for discriminatory tariffs charged by service providers. The decision of the Authority as to whether a service provider is in contravention of this regulation will be final and binding. 

    ‘The Prohibition of Discriminatory Tariffs for Data Services Regulations 2016,’ issued today comes into effect immediately and will be reviewed every two years.

    TRAI said allowing service providers to charge differently for data could compromise the entire architecture of the internet. “Prohibition of discriminatory tariff is necessary to ensure that service providers continue to fulfill obligations in keeping internet open and non-discriminatory,” TRAI said.

    The Regulation has been issued after reviewing the responses received by the regulator to its Consultation Paper on Differential Pricing for Data Services issued on 9 December last year. As was reported earlier by Indiantelevision.com, major broadcasters like Star India, Sony Pictures Networks India and Zee Network submitted their comments to TRAI in favour of net neutrality citing the drawbacks of differential pricing for telecom services.

    TRAI said the paper was issued because two key principles of tariff regulation – non-discrimination and transparency were getting impacted from such practices and required consultation. 

    While almost all the broadcasters opposed differential rates, the telecom and internet service providers felt that this was necessary particularly in view of the deluge of over the top (OTT) services expected to come in.

    The general economic concept of ‘price differentiation’ covers all practices where a seller of goods or provider services charges different prices from different consumers, either for exactly the same goods or service or for slightly different versions of the same goods or service. The ‘service’ being referred to in the context of differential pricing of data services is the units of data or bits that a person consumes in order to access the internet. This understanding is also qualified by the fact that the current regulation refers to a particular category of price differentiation – that is content-specific. 

    While ruling out differential pricing in such cases, TRAI put a proviso: “Provided that this regulation shall not apply to tariffs for data services over closed electronic communications networks, unless such tariffs are offered or charged by the service provider for the purpose of evading the prohibition in this regulation.”

    It also said, “A service provider may reduce tariff for accessing or providing emergency services, or at times of grave public emergency, provided that such tariff shall be reported to the Authority within seven working days from the date of implementation of the reduced tariff and the decision of the Authority as to whether such reduced tariff qualifies under this regulation shall be final and binding.”

    The penalties will be imposed only after the service provider has been given a reasonable opportunity of representing against the contravention of the regulation. The amount payable by way of financial disincentive under these regulations will be remitted to such head of account as may be specified by TRAI.

    The regulator also said, “Nothing contained in these regulations shall affect any packs, plans or vouchers with unexpired validity subscribed by a consumer before the date of commencement of these regulations, provided that no such pack, plan or voucher shall be valid beyond a period of six months from the date of commencement of these regulations.”

    Explaining the rationale for the paper, TRAI said, “Some practices have come to the notice of the Authority wherein differential tariffs were offered based on the content, websites, applications, platforms.”

    It also said the appropriate regulatory response on the issue of differential pricing must necessarily be grounded in a sound understanding of the basic architecture of the internet. Any proposed changes in business models and commercial practices must also be seen in the context of the need to preserve the unique architecture of the Internet as a global communication network.

    The Internet and Mobile Association of India (IAMAI) welcomed the Regulation as a bold and fair move. It said net neutrality would be ensured with TRAI explicitly clarifying its stand in a very clear and transparent ruling about differential tariffs and agreements. The association had taken a ‘no exception standpoint’ against differential pricing.

    “This ruling vindicates the associations stand on the issue. The internet Start-up eco-system and the internet user community are delighted,” IAMAI said. 

    IAMAI has also welcomed the move that TRAI will be the ultimate authority to decide the cases of violations of this ruling and that the decision of the authority will be final and binding. 

    However, the association voiced a concern on the exceptions as to how this will pan out. The association hoped that the exceptions to the rule will not be misused by the TSPs. The exception states “…regulation shall not apply to tariffs for data services over closed electronic communications networks…”

    Meanwhile, the campaigner change.org claimed a massive victory and said “History has been created!” It said nearly 3.75 lakh Change.org users had supported Net Neutrality. 

    The nationwide campaign that unfolded over almost a year was started by Sandeep Pillai, a techie from Kollam in Kerala.

  • TRAI rules against differential pricing for telecom services; imposes penalty of Rs 50,000 per day for offenders

    TRAI rules against differential pricing for telecom services; imposes penalty of Rs 50,000 per day for offenders

    NEW DELHI: In what is clearly a major win for crusaders of net neutrality, the Telecom Regulatory Authority of India (TRAI) has ruled against differential pricing and said no service provider will enter into any arrangement or contract that has the effect of discriminatory tariffs for data services.

    TRAI reserved the right to either ask a service provider to withdraw any discriminatory tariff or impose a penalty of Rs 50,000 per day (subject to a maximum of Rs 50 lakh) for discriminatory tariffs charged by service providers. The decision of the Authority as to whether a service provider is in contravention of this regulation will be final and binding. 

    ‘The Prohibition of Discriminatory Tariffs for Data Services Regulations 2016,’ issued today comes into effect immediately and will be reviewed every two years.

    TRAI said allowing service providers to charge differently for data could compromise the entire architecture of the internet. “Prohibition of discriminatory tariff is necessary to ensure that service providers continue to fulfill obligations in keeping internet open and non-discriminatory,” TRAI said.

    The Regulation has been issued after reviewing the responses received by the regulator to its Consultation Paper on Differential Pricing for Data Services issued on 9 December last year. As was reported earlier by Indiantelevision.com, major broadcasters like Star India, Sony Pictures Networks India and Zee Network submitted their comments to TRAI in favour of net neutrality citing the drawbacks of differential pricing for telecom services.

    TRAI said the paper was issued because two key principles of tariff regulation – non-discrimination and transparency were getting impacted from such practices and required consultation. 

    While almost all the broadcasters opposed differential rates, the telecom and internet service providers felt that this was necessary particularly in view of the deluge of over the top (OTT) services expected to come in.

    The general economic concept of ‘price differentiation’ covers all practices where a seller of goods or provider services charges different prices from different consumers, either for exactly the same goods or service or for slightly different versions of the same goods or service. The ‘service’ being referred to in the context of differential pricing of data services is the units of data or bits that a person consumes in order to access the internet. This understanding is also qualified by the fact that the current regulation refers to a particular category of price differentiation – that is content-specific. 

    While ruling out differential pricing in such cases, TRAI put a proviso: “Provided that this regulation shall not apply to tariffs for data services over closed electronic communications networks, unless such tariffs are offered or charged by the service provider for the purpose of evading the prohibition in this regulation.”

    It also said, “A service provider may reduce tariff for accessing or providing emergency services, or at times of grave public emergency, provided that such tariff shall be reported to the Authority within seven working days from the date of implementation of the reduced tariff and the decision of the Authority as to whether such reduced tariff qualifies under this regulation shall be final and binding.”

    The penalties will be imposed only after the service provider has been given a reasonable opportunity of representing against the contravention of the regulation. The amount payable by way of financial disincentive under these regulations will be remitted to such head of account as may be specified by TRAI.

    The regulator also said, “Nothing contained in these regulations shall affect any packs, plans or vouchers with unexpired validity subscribed by a consumer before the date of commencement of these regulations, provided that no such pack, plan or voucher shall be valid beyond a period of six months from the date of commencement of these regulations.”

    Explaining the rationale for the paper, TRAI said, “Some practices have come to the notice of the Authority wherein differential tariffs were offered based on the content, websites, applications, platforms.”

    It also said the appropriate regulatory response on the issue of differential pricing must necessarily be grounded in a sound understanding of the basic architecture of the internet. Any proposed changes in business models and commercial practices must also be seen in the context of the need to preserve the unique architecture of the Internet as a global communication network.

    The Internet and Mobile Association of India (IAMAI) welcomed the Regulation as a bold and fair move. It said net neutrality would be ensured with TRAI explicitly clarifying its stand in a very clear and transparent ruling about differential tariffs and agreements. The association had taken a ‘no exception standpoint’ against differential pricing.

    “This ruling vindicates the associations stand on the issue. The internet Start-up eco-system and the internet user community are delighted,” IAMAI said. 

    IAMAI has also welcomed the move that TRAI will be the ultimate authority to decide the cases of violations of this ruling and that the decision of the authority will be final and binding. 

    However, the association voiced a concern on the exceptions as to how this will pan out. The association hoped that the exceptions to the rule will not be misused by the TSPs. The exception states “…regulation shall not apply to tariffs for data services over closed electronic communications networks…”

    Meanwhile, the campaigner change.org claimed a massive victory and said “History has been created!” It said nearly 3.75 lakh Change.org users had supported Net Neutrality. 

    The nationwide campaign that unfolded over almost a year was started by Sandeep Pillai, a techie from Kollam in Kerala.

  • Facebook’s Free Basics in a pinch in India; Zuckerberg comes to rescue with op-ed

    Facebook’s Free Basics in a pinch in India; Zuckerberg comes to rescue with op-ed

    MUMBAI: Facebook founder and CEO Mark Zuckerberg is on a mission – digital equality in the world. His means to achieve it? Internet.org that has been rechristened as ‘Free Basics’ in India. What’s standing in his way? The Telecom Regulatory Authority of India (TRAI).

     

    The prolonged debate over net neutrality and whether Free Basic will be detrimental to it has not only led to the establishment of online communities such as savetheinternet and online celebrities like All India Bakchod (AIB) to release a three part series on the subject, but also caught the government body’s attention. TRAI has asked Facebook’s only partner in the project, Reliance Communications to cease all work on Free Basics till it takes a call on the fairness of operators placing prices on certain online content and services.

     

    A move that only egged on Facebook further and that’s when it came up with an extensive online campaign that asked users to sign a petition addressed to TRAI in support of Free Basics.

     

    To further abate the growing skepticism over the service amongst Indian netizens, the social media giant also went offline with their advertising campaign. From full page advertisements in leading newspapers to billboards across the country’s metros, Facebook has made its presence felt and motive clear: it will leave no stones unturned to make Free Basics a reality.

     

    The idea behind the campaign was to highlight the need for Free Basics in India, especially for the underprivileged.

     

    “Hundreds of millions of people in India use the Internet every day and understand the benefits it can bring. This campaign gives people the opportunity to support digital equality in India. It lets people speak in support of the one billion people in India who remain unconnected, and lets them participate in the public debate that is being held by the Telecom Regulatory Authority of India on differential pricing for data services. And it gives them the opportunity to support Free Basics, which is proven to bring more people online and accelerate full internet adoption,” a Facebook spokesperson tells Indiantelevision.com.

     

    The campaign did gain ground and as per a survey commissioned by Facebook, overall, 86 per cent of respondents support Free Basics when presented with arguments for and against the service

    conducted by David Binder Research in partnership with India’s Hansa Research, the survey was sampled from 3000 people in India.

     

    “At the heart of the results was awareness of the importance of the Internet in shaping India’s future. A majority (65 per cent) of Indians agreed with the statement that, ‘a connected India is a stronger India and connecting more people makes India stronger, more informed, and more competitive in the world’ and more than half support the Digital India initiative,” the report states.

     

    Nevertheless, questions were raised on whether Free Basics truly adheres to what the advertisement campaign claims —  internet for all.

     

    In fact, the Advertising Standards Council of India (ASCI) received several complaints and petitions from netizens across the country stating that the advertisements were insensitive and only painted a one dimensional picture about rural India and its basic needs. Several argue that it is a very simplistic way to sell their product projecting Free Basics as some sort of a magic wand that waves away underprivileged India’s problems.

     

    While TRAI still awaits an official response from Facebook over the credibility of their campaign, Zuckerberg’s op-ed in one of India’s leading daily clearly addresses the subject.

     

    “More than 35 operators have launched Free Basics and 15 million people have come online. And half the people who use Free Basics to go online for the first time pay to access the full internet within 30 days. If we accept that everyone deserves access to the internet, then we must surely support free basic internet services. That’s why more than 30 countries have recognised Free Basics as a program consistent with net neutrality and good for consumers. Who could possibly be against this? Surprisingly, over the last year there’s been a big debate about this in India,” writes Zuckerberg,” adding, “Instead of wanting to give people access to some basic internet services for free, critics of the program continue to spread false claims – even if that means leaving behind a billion people.”

     

    One would argue that Zuckerberg is almost suggesting that India accepts Free Basics without any questions asked as it at least solves its problem of internet for all. The question of net neutrality is secondary to a developing country.

     

    Citing an example of a farmer in India, Zuckerberg highlights the power of internet in connecting India. “A few months ago I learned about a farmer in Maharashtra called Ganesh. Last year Ganesh started using Free Basics. He found weather information to prepare for monsoon season. He looked up commodity prices to get better deals. Now Ganesh is investing in new crops and livestock.”

     

    What is interesting to note here is that the example is in line with their campaign that speaks of rural India urging everyone to focus on immediate advantages of free internet for all.

     

    Regarding its long term effect on net neutrality and Facebook’s advantage over other players in market, the CEO argues, “There is no advantage because the platform is open to all developers. Facebook does not receive or give any money to developers, telcos or anyone else for their participation in Free Basics, nor does Facebook generate any revenue from the version of Facebook within Free Basics as there are no ads in it. Our connectivity efforts have brought 15 million new people online and is consistent with net neutrality because the actual results from the program prove it serves as a bridge to the full internet for people, and is non-discriminatory.”

     

    And while Zuckerberg rallies for Free Basics, even as he takes his paternity leave, a Reliance Mobiles’ TVC on ‘New Ways To Facebook’ has surfaced, adding an interesting angle to their partnership, and its impending impact on free competition in the market.

    Promising free access to Facebook even on offline mode through their specially designed ‘Go To Facebook’ button, which is available exclusively to Reliance Mobile users, the mass media campaign might not go down well with the ‘save the internet’ crusaders.

     

    Whether this will dent the progress Free Basics has had in convincing netizens in favour of it, or Facebook’s mission of Free Basics will be possible, one thing is for sure, it’s certainly made the space more exciting and started many a conversations.

  • Decision on net neutrality case in US likely to affect Internet users globally

    Decision on net neutrality case in US likely to affect Internet users globally

    New Delhi Even as net neutrality became a major issue in India earlier this year when reports of Internet censorship began filtering in, a Federal Appeals court in Washington is to decide a major case in this regard early next month.

     

    The outcome of this case is expected to set a trend that may affect Internet all over the world.

     

    The issue being taken up is the United States net neutrality rules banning telecom and cable companies from unfairly discriminating against new or potential rivals.

     

    If the court gives a rule in their favour, Internet providers could begin favouring preferred websites and control what services consumers can access from their smartphones, tablets and PCs.

     

    Interestingly, one of three judges who will hear this matter on 4 December is of Indian origin, Judge Sri Srinivasan who was appointed in 2013.

     

    The other judges are Judge Stephen F. Williams and Judge David S. Tatel. Tatel along with two other judges held in 2014 that the Federal Communications Commission misused its powers to impose net neutrality on Internet providers which led to a lot of debate in the US. The case was a petition filed by Verizon against FCC. 

     

  • Facebook’s Mark Zuckerberg on India, Internet.org, net neutrality

    Facebook’s Mark Zuckerberg on India, Internet.org, net neutrality

    MUMBAI: Facebook co-founder and CEO Mark Zuckerberg has set his sights on the Indian market in a big way, which according to him is one of the key markets for the social networking company.

     

    In his second visit this year to the country, the young entrepreneur visited the Indian Institute of Technology (IIT) Delhi, where close to 900 students attended the Question & Answer session.

    Zuckerberg addressed issues such as Net Neutrality, internet access as well as Facebook’s initiatives to invest in India.

    Speaking at the event, Zuckerberg said that his mission was to connect everyone in India to the internet.

    According to a UK based consultancy We Are Social and Facebook India, of the 1.49 billion people who check Facebook at least once a month, more than 130 million are in India. It is more than anywhere outside the US and the number has been rising in recent years.Facebook had 118 million users in 2014 as compared to a year earlier, which was 93 million.

     

    Zuckerberg explained that Facebook’s initiative Internet.org has nothing insidious but aims to provide connectivity for access to education, health care and financial services to millions of Indians. Internet.org was launched in 2013 for a global effort to provide web access to unconnected users in the developing nations.

     

    Speaking on the investment on Artificial Intelligence Systems, Zuckerberg said, “AI is really exciting. We will be able to see smarter computers being built. With AI, it’s going to be less about products and making the existing ones smarter. We are working on a project where AI can describe photos to blind people. Second example, right now the best way to let people know you are safe in terms of a crisis is by yourself or through your friends. In the future maybe satellites and other technologies can help with this.”

     

    He said that almost three million people said they were safe by using Facebook’s safety-check feature after the recent earthquake in Afghanistan. “When there’s a disaster all you want to know if your loved ones are safe,” he said.

     

    He further spoke on Net Neutrality saying, “Most of the people pushing for net-neutrality already have access to Internet. But those who aren’t, can’t sign an online petition for an increase in the Internet. We all have a moral responsibility to look out for those who don’t have access and make sure the rules don’t get twisted to hurt those who don’t have a voice.”

     

    Later, taking to his Facebook page, he posted an update about the Townhall Q&A in Delhi saying, “We just wrapped up our Townhall Q&A in Delhi! People asked great questions about how we can connect everyone in India to the internet, how we provide everyone with a great education and how to build a strong company. I really appreciate these Q&AS. Hearing what you care about makes Facebook better. Thanks to everyone who asked a question or tuned in!”

  • Mark Zuckerberg on Internet.org and Net Neutrality in India

    Mark Zuckerberg on Internet.org and Net Neutrality in India

    Over the past week in India, there has been a lot written about Internet.org and net neutrality. I’d like to share my position on these topics here for everyone to see.

    First, I’ll share a quick story. Last year I visited Chandauli, a small village in northern India that had just been connected to the internet.

    In a classroom in the village, I had the chance to talk to a group of students who were learning to use the internet. It was an incredible experience to think that right there in that room might be a student with a big idea that could change the world — and now they could actually make that happen through the internet.

    The internet is one of the most powerful tools for economic and social progress. It gives people access to jobs, knowledge and opportunities. It gives voice to the voiceless in our society, and it connects people with vital resources for health and education.

    I believe everyone in the world deserves access to these opportunities.

    In many countries, however, there are big social and economic obstacles to connectivity. The internet isn’t affordable to everyone, and in many places awareness of its value remains low. Women and the poor are most likely to be excluded and further disempowered by lack of connectivity.

    This is why we created Internet.org, our effort to connect the whole world. By partnering with mobile operators and governments in different countries, Internet.org offers free access in local languages to basic internet services in areas like jobs, health, education and messaging.Internet.org lowers the cost of accessing the internet and raises the awareness of the internet’s value. It helps include everyone in the world’s opportunities.

    We’ve made some great progress, and already more than 800 million people in 9 countries can now access free basic services throughInternet.org. In India, we’ve already rolled out free basic services on the Reliance network to millions of people in Tamil Nadu, Maharashtra, Andhra Pradesh, Gujarat, Kerala and Telangana. And we just launched in Indonesia on the Indosat network today.

    We’re proud of this progress. But some people have criticized the concept of zero-rating that allows Internet.org to deliver free basic internet services, saying that offering some services for free goes against the spirit of net neutrality. I strongly disagree with this.

    We fully support net neutrality. We want to keep the internet open. Net neutrality ensures network operators don’t discriminate by limiting access to services you want to use. It’s an essential part of the open internet, and we are fully committed to it.

    But net neutrality is not in conflict with working to get more people connected. These two principles — universal connectivity and net neutrality — can and must coexist.

    To give more people access to the internet, it is useful to offer some service for free. If someone can’t afford to pay for connectivity, it is always better to have some access than none at all.

    Internet.org doesn’t block or throttle any other services or create fast lanes — and it never will. We’re open for all mobile operators and we’re not stopping anyone from joining. We want as many internet providers to join so as many people as possible can be connected.

    Arguments about net neutrality shouldn’t be used to prevent the most disadvantaged people in society from gaining access or to deprive people of opportunity. Eliminating programs that bring more people online won’t increase social inclusion or close the digital divide. It will only deprive all of us of the ideas and contributions of the two thirds of the world who are not connected.

    Every person in the world deserves access to the opportunities the internet provides. And we can all benefit from the perspectives, creativity and talent of the people not yet connected.

    We have a historic opportunity to connect billions of more people worldwide for the first time. We should work together to make that happen now.

     

    DISCLAIMER: The author of this article is Facebook Chairman and CEO. The article has been sourced from Mark Zuckerberg’s Facebook page. The views expressed here are purely personal views of the author and Indiantelevision.com does not necessarily subscribe to them.

  • Enforcing Net Neutrality: A continuous monitoring challenge

    Enforcing Net Neutrality: A continuous monitoring challenge

    NEW DELHI: Participants at a discussion on net neutrality feel that the Department of Telecom’s (DoT) recommendations on the subject are ‘soft approaches’ for bigger violations that impact principles of Net Neutrality.

     

    Furthermore, it was felt that there seem to be no recommendations on quantum of penalty or punishments in case of deliberate violations on Net Neutrality.   

     

    The Indian Legal Foundation (TILF) – a New Delhi based Think Tank organization – in association with Grandmasters India conducted the Brainstorming and Forum Discussion focusing on the various aspects of Net Neutrality with participants from corporates, government, politics, NGOs and startups.

     

    Even as the DoT panel lead by A K Bhargava released its report on Net Neutrality, there still remained concerns among the free Internet proponents about the enforcement of principles of Net Neutrality.

     

    The DoT panel suggestions on enforcing Net Neutrality included enacting a law, amending licensing conditions, creating a DoT monitoring cell and also creating training institutions to monitor Net Neutrality violations.

     

     “While we appreciate the overall intent of DoT report, but where does it talk about penalties, like we saw in the recent AT&T case in United States,” asked TILF chairperson, government affairs Renu Jha.

     

    Jha further said, “We need to create a regulatory body with powers to impose fine and punishments. It is a necessary step towards creating and regulating Net Neutrality in India.”

     

    While welcoming DoT recommendations, Samsung general counsel Rajendra Sharma said, “There still needs to be a lot of work in creating an appropriate legislation around the governance of Internet in India. We need to incorporate best practices from EU and United States to ensure freedom of Internet in India.”

     

    The Think Tank Event was presided over by Member of Parliament and mediaperson Tarun Vijay, who is among the most vocal proponents of free Internet in India and has equated net neutrality to Human Rights of Digital Age. 

     

    “Net Neutrality is core and essential to the government programme on skill development, Digital India and Make In India. Government and Indian parliament is committed to Net Neutrality. Any apprehension on recent DoT recommendation will be debated and government will fight for democracy of Internet,” said Vijay.

     

    The event was also marked by a number of startups concerned about their growth in case telcos are allowed to disseminate discriminatory tariffs or bandwidth to users.

     

    “Will it not be a classic case of crony capitalism if startup applications are discriminated as they are unable to cuff up extra bug for telcos,” asked Yogesh Kochar, a social media start up for school students in India. Agreeing with young startup entrepreneurs, Jha stated, “India is hub of startups for quality software and mobile applications. Any pricing or accessibility discrimination against newer applications by Telcos will certainly kill their growth and stifle innovation.”

     

    The Government’s hypothesis needs to be supported – “Good” regulations are better than “No” regulations at all. We do not want Indian Government or DoT to be silent on this important subject. If they remain silent and do not positively support Net Neutrality, ISPs on a later date can disrupt access to websites that do not pay them or compete with their interests. Indeed, the survival of Internet depends on DoT and Government of India and it’s implementation and enforcement of principles of Net Neutrality.

  • Strong subscriber growth boosts Netflix revenue in Q2 but profit declines

    Strong subscriber growth boosts Netflix revenue in Q2 but profit declines

    MUMBAI: Movie streaming service provider Netflix has added as many as 2.5 million new subscribers in Q2 2015, taking its total subscribers worldwide to a whopping 65.6 million and counting.

     

    However, while the company’s Q2 revenue saw a boost at $1.5 billion as compared to $1.223 billion last year, its profit showed a decline by almost 63 per cent. The company earned $26.3 million (6 cents per share), in the second quarter, which was down from $71 million (16 cents per share) during the corresponding period last year.

     

    Of the 65.6 million subscribers, 42 million are in the US, whereas the remaining 23 million were from international markets. By the end of the third quarter, Netflix predicts that its subscriber number would touch 69 million. The company has ambitious growth plans and plans to make its service available throughout the world by the end of 2016.

     

    Q2 results and Q3 forecast:

     

    Netflix’s higher than anticipated level of acquisition was fuelled by the growing strength of its original programming slate, which in Q2 included the first seasons of Marvel’s Daredevil, Sense8, Dragons: Race to the Edge and Grace and Frankie as well as season 3 of Orange is the New Black.

     

    US revenue growth was also driven by a five per cent year over year increase in ASP due to uptake in its HD 2-stream plan. The company will continue to target a 40 per cent US contribution margin by 2020, even though it is running ahead of plan given stronger than expected top line performance and lower content and other streaming costs. Netflix forecasts Q3 US net adds of 1.15 million, which is slightly higher than the year ago period.

     

    “Our international segment is growing at a rapid pace. We did not add additional markets in Q2 but saw continued improvement across existing markets, including a full quarter of additions from our successful 24 March, 2015 launch in Australia/New Zealand. We project Q3 international net adds of 2.4 million,” Netflix CEO Reed Hastings said.

     

    International revenue grew 48 per cent year over year, despite an -$83 million impact from currency (+five per cent ASP growth x-F/X). “As we expected, international losses increased sequentially with a full quarter of operating costs in AU/NZ. We expect this trend to continue in the second half as we launch additional markets (Japan in Q3 and Spain, Italy and Portugal in Q4) and prepare for further global expansion in 2016, including China as we continue to explore options there,” Hastings added.

     

    EPS for Q2 amounted to $0.06 after adjustment for our 7-for-1 stock split (EPS would have been $0.42 using pre-split share count). Netflix said it remained committed to running around break-even globally on a net income basis through 2016, and to then deliver material global profits in 2017 and beyond.

     

    Content:

     

    Netflix is making progress shifting to exclusive content and expanding its original content, which differentiates its service, drives enjoyment for existing members and helps motivate consumers to join in.

    In Q2, Netflix launched its largest number of original series to date. On 10 April, Marvel’s Daredevil debuted to strong audience engagement, particularly for a new show. Grace and Frankie, the bittersweet comedy starring Lily Tomlin and Jane Fonda, which launched on 8 May, also has found a broad and appreciative audience around the world. Both series have already begun their second season of production.

     

    The company’s global expansion extends to its content strategy as well. Sense8, the mind-bending cinematic thriller from the Wachowski siblings and J. Michael Straczynski that debuted 5 June, is an ambitious, truly international show with talent behind and in front of the camera from multiple countries. Similarly, on 7 August, Netflix will launch in all territories its first non-English language original, Club de Cuervos, a family comedy set in the world of futbol from Mexican filmmaker GazAlazraki, and on 28 August, Narcos, a gripping account of the roots of the cocaine trade, shot in Colombia and starring the great Brazilian star Wagner Moura as Pablo Escobar.

     

    The original documentary Chef’s Table and its latest DreamWorks Animation series Dragons: Race to the Edge are among its most viewed new originals to date.

     

    Netflix closed the quarter with season 3 of Orange is the New Black, which went live on 11 June and set off a social media shockwave around the world. On the following Sunday, Netflix members globally watched a record number of hours in a single day, led by Orange, despite the season finale of HBO’s Game of Thrones and game five of the NBA finals also falling on that Sunday.

     

    “Global enthusiasm for the third season of Orange underlines our ability to create franchise properties that bring new members to Netflix as well as delighting current ones. Nearly ninety percent of Netflix members have engaged with Netflix original content, another indicator that we are on the right path,” Hastings said.

     

    “We anticipate that as our global content spend approaches $5 billion in 2016 on a P&L basis (over $6 billion cash), we will devote more investment to originals both in absolute dollars and percentage terms. This includes not only series, documentaries and stand-up but also original feature films,” Hastings added.

     

    Netflix is moving into the original film business in order to have new, high-quality movies that can be found only on its platform. “As with series, we’ve chosen to take a portfolio approach covering a wide variety of genres and based around creators with great track records and stories they are passionate about. The first of our films, Beasts of No Nation, a gripping war drama from the award-winning director Cary Fukunaga and starring award-winning Idris Elba will be available to all Netflix members and in select theaters in October. In June, we announced War Machine, a provocative satirical comedy starring Brad Pitt, which will be exclusively available to Netflix members and in select theaters next year,” Hastings said.

     

    Strong Net Neutrality:

     

    “Charter Communications made net neutrality history by committing to open and free interconnection across the Charter/TWC network, if their pending merger is approved. This move ensures that all online video providers can aggressively compete for consumers’ favour, without selective and increasing fees paid to ISPs. Charter’s interconnection policy is the right way to scale the Internet. It means consumer will receive the fast connection speeds they expect. The Charter/TWC transaction, with this condition, would deliver significant public interest benefits to broadband consumers, and we urge its timely approval,” said Hastings.

     

    DVD:

     

    The company’s DVD-by-mail business in the US continues to serve 5.3 million members and provided $77.9 million in contribution profit in Q2. 

  • Net Neutrality: DoT Committee suggests plan of action, roots for expansion of OTT services

    Net Neutrality: DoT Committee suggests plan of action, roots for expansion of OTT services

    NEW DELHI: User rights on the Internet need to be ensured so that Telecom Service Providers (TSPs) and Internet Service Providers (ISPs) do not restrict the ability of the user to send, receive, display, use, post any legal content, application or service on the Internet, or restrict any kind of lawful Internet activity.

     

    However only the Government can decide what constitutes legality in relation to the content, application or service, with scope for judicial adjudication in case of any dispute.

     

    This has been stated by a Committee constituted by the Department of Telecom (DoT) and headed by member (Technology) A K Bhargava on 19 January this year to study Net Neutrality and its implications. 

     

    Other members were A K Mittal who is senior DDG TEC; Shashi Ranjan Kumar joint secretary (A); V Umashankar joint secretary (T); Narendra Nath – DDG (Security); and R M Agarwal – DDG (NT) who was also convenor of the committee.

     

    The Telecom Regulatory Authority of India (TRAI) issued a consultation paper in March this year titled “Regulatory Framework for Over-the-Top (OTT) Services” where the issue of Net Neutrality in the backdrop of OTT services came to the fore.

     

    The TRAI consultation paper sharply intensified the debate on Net Neutrality with broadcasters and telecom operators giving radically opposite views.

     

    At the outset, the DOT Committee said India has 997 million telecom subscribers and 99.20 million broadband subscribers with an access to internet at speeds higher than 512 kbps. Out of about 300 million subscribers accessing the internet, around 93 per cent subscribers are on wireless media, whereas seven per cent are on fixed wire line media. Currently, both broadband and internet penetration in India is comparatively low in the global context.

     

    In India, Internet traffic is likely to increase manifold in the next few years. There is a constant pressure for investment in network infrastructure and to expand capacities and increase penetration. Telecom infrastructure, being a capital intensive industry, will require significant investments by operators to meet the network capacity demands brought about by increasing broadband penetration, increasing speeds and increasing data usage.

     

    Telecom service providers have also started facing competition from unlicensed application platforms, termed Over-the-Top (OTT) players, in their traditional voice communication field.

     

    With an objective of enhancing revenue streams and to face competition from OTT players, telecom service providers have been exploring new opportunities for generating revenues from users and the content providers. Some of the models attempted by TSPs, such as charging higher.

     

    The Committee said content and application providers cannot be permitted to act as gatekeepers and use network operations to extract value in violation of core principles of Net Neutrality, even if it is for an ostensible public purpose.

     

    The Committee refrained from making any specific recommendation on search-neutrality, however, flags this issue as a concern for public policy. 

     

    In the report that runs into more than 100 pages, the Committee unhesitatingly recommends that “the core principles of Net Neutrality must be adhered to.”

     

    The Committee suggested an enforcement process where the core principles of Net Neutrality may be made part of license conditions and the licensor may issue guidelines from time to time as learning process matures. Since Net Neutrality related cases would require specialized expertise, a cell in the DoT HQ may be set up to deal with such cases. In case of violations, the existing prescribed procedure may be followed. This would involve two stage process of review and appeal to ensure that decisions are objective, transparent and just. 

     

    The tariff shall be regulated by TRAI as at present. Whenever a new tariff is introduced it should be tested against the principles of Net Neutrality. Post implementation, complaint regarding a tariff violating principle of Net Neutrality may be dealt with by DoT. Net Neutrality issues arising out of traffic management would have reporting and auditing requirements, which may be performed and enforced by DoT. QoS issues fall within the jurisdiction of TRAI. Similarly reporting related to transparency requirements will need to be dealt with by TRAI. TRAI may take steps as deemed fit.

     

    National security is paramount, regardless of treatment of Net Neutrality. The measures to ensure compliance of security related requirements from OTT service providers need to be worked out through inter-ministerial consultations.

     

    India should take a rational approach and initiate action in making an objective policy, specific to the needs of our country. It says both innovation and infrastructure have to be promoted simultaneously and neither can spread without the other. 

     

    The primary goals of public policy in the context of Net Neutrality should be directed towards achievement of developmental aims of the country by facilitating “Affordable Broadband”, “Quality Broadband” and “Universal Broadband” for its citizens.

     

    OTT application services have been traditionally available in the market for some time and such services enhance consumer welfare and increase productivity. Therefore, such services should be actively encouraged and any impediments in expansion and growth of OTT application services should be removed.

     

    There should be a separation of “application layer” from “network layer” as application services are delivered over a licensed network. 

     

    Specific OTT communication services dealing with messaging should not be interfered with through regulatory instruments.

     

    In case of VoIP OTT communication services, there exists a regulatory arbitrage wherein such services also bypass the existing licensing and regulatory regime creating a non-level playing field between TSPs and OTT providers both competing for the same service provision. Public policy response requires that regulatory arbitrage does not dictate winners and losers in a competitive market for service provision. 

     

    The existence of a pricing arbitrage in VoIP OTT communication services requires a graduated and calibrated public policy response. 

     

    In case of OTT VoIP international calling services, a liberal approach may be adopted. However, in case of domestic calls (local and national), communication services by TSPs and OTT communication services may be treated similarly from a regulatory angle for the present. The nature of regulatory similarity, the calibration of regulatory response and its phasing can be appropriately determined after public consultations and TRAI’s recommendations to this effect.

     

    For OTT application services, there is no case for prescribing regulatory oversight similar to conventional communication services.

     

    Legitimate traffic management practices may be allowed but should be “tested” against the core principles of Net Neutrality. General criteria against which these practices can be tested are as follows:

     

    1.       TSPs/ISPs should make adequate disclosures to the users about their traffic management policies, tools and intervention practices to maintain transparency and allow users to make informed choices.

    2.       Unreasonable traffic management, exploitative or anti-competitive in nature may not be permitted.

    3.      Tariff plans offered by TSPs/ISPs must conform to the principles of Net Neutrality set forth in guidelines issued by the Government as Licensor and TRAI may examine the tariff filings made by TSPs/ISPs to determine whether the tariff plan conforms to the principles of Net Neutrality.

     

    New legislation, whenever planned for replacing the existing legal framework, must incorporate principles of Net Neutrality. Till such time as an appropriate legal framework is enacted, interim provisions enforceable through licensing conditions as suggested by the Committee may be the way forward.

     

    Since enforcing Net Neutrality principle is a new idea and may throw up many questions and problems in the days ahead, an oversight process may be set up by the government to advise on policies and processes, review guidelines, reporting and auditing procedures and enforcement of rules.

     

    Capacity building through training, institution building and active engagement with stakeholders is essential. In order to deal with the complexities of the new digital world, a think-tank with best talent may also be set up.

     

    Click here to read IAMAI welcomes DoT recommendations on Net Neutrality