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Airtel has written to the Indian telecom regulator TRAI, asking for a clarification on whether it can launch a video content service from a “Big Global Content Provider” on its platform, exclusive to Airtel customers. A copy of the letter, which MediaNama has obtained from sources, is below. Airtel has declined to comment on the letter, and also declined to comment on which content provider has approached it for a partnership.

Airtel is checking about providing this service over its “Closed Electronic Communications Network” (CECN). A CECN is an intranet, and a walled garden, where a company is providing the service only to its own customers, and isn’t the Internet.

MediaNama’s Take

1. Airtel shouldn’t be allowed to provide this service: As per the TRAI regulation (download), the prohibition on discriminatory tariffs (such as Zero Rating; a Net Neutrality violation) will apply “if such a closed network is used for the purpose of evading these regulations”.

That to us suggests that if, (for example) an online service such as NetFlix is being provided to Airtel customers on an intranet connection which is being zero rated, the choice of providing this over an intranet is merely in order to evade the TRAI regulations on Differential Pricing. The regulations are meaningless if an online entity that wants to be zero rated can tie up with each telecom operator and offer its services to customers of each telecom operator. This is collusive, and the collusion between content providers and telecom operators is one that the Department of Telecom had also warned about in its report. The specific TRAI provision:

Differential tariffs being offered for data transmitted over closed electronic communications networks, such as intranets are not prohibited by these regulations. Though the prohibition on discriminatory pricing of data services does not apply to such networks, which are not accessing the internet, if such a closed network is used for the purpose of evading these regulations, the prohibition will nonetheless apply.

Related Read:

Would telcos exploit private networks to implement differential pricing? – Vishal Misra

TRAI on differential pricing: The use of internet should advance free speech

What the DOT Committee report (summary) said in the context of Internet.org, but should be applicable in case of large content providers like NetFlix and Amazon as well:

The committee was conscious that market for content provision indicates that clear market leaders emerge in a short while, and if such market leaders are able to dictate the path to specific content, then the principles of non-discriminatory access form the user viewpoint can be compromised leading to distortions emerging in the content provision market and consequent implications for the larger Internet economy and emergence of new innovations. The committee therefore is of the firm opinion that content and application providers cannot be permitted to act as gatekeepers and use network operations to extract value even if it is for an ostensible public purpose.

Collaborations between TSPs and content providers that enable such gatekeeping role to be played by any entity should be actively discouraged. If need be government and the regulator may step in to restore balance to ensure that the internet continues to remain an open and neutral platform for expression and innovation with no TSP/ISP or for that matter any content or application provider, having the potential or exercising the ability to determine user choice distort consumer markets or significantly controlling preferences based on either market dominance or gatekeeping roles.

Thus, no collaboration should be allowed between Airtel and the content provider.

2. The politics of the whole thing: Readers might recall that the telecom operators had written to the TRAI asking for a clarification on the differential pricing regulations, specifically on the Intranet provisions. The TRAI hasn’t yet issued a clarification, and so this is probably Airtel’s way of forcing its hand. Now that it has formally asked for permission, the TRAI will be forced to clarify. Remember that Reliance Jio is also launching a number of Intranet services. If the TRAI ruling prevents the provisioning of an Internet service on an Intranet, then this might limit Jio’s services as well. Readers might recall how Airtel hived off VoIP into a separate data pack in December 2014, and withdrew this provision after the TRAI said that there would be a Net Neutrality consultation.

3. Who’s the big global content provider? The only two we can think of with a potential interest in India are NetFlix (which has already launched), and Amazon (with its Prime service). The grapevine – and this is unconfirmed – points towards NetFlix. We’ve written to Airtel, NetFlix and Amazon for confirmation or denial. Airtel has declined to comment.

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Airtel’s Letter to TRAI on

Date: 25th April 2016

To,

The Secretary
Telecom Regulatory Authority of India,
Mahanagar Doorsanchar Bhawan,
Jawaharlal Nehru Marg (Old Minto Road),
New Delhi 110002

Subject: Agreements with Big Global Content Providers for CECN

Reference: TRAI Regulation on Prohibition of Discriminatory Tariffs for Data Services Regulations, 2016 (No. 2 of 2016) dated 8th February 2016

Dear Sir,

We wish to bring to your kind attention that we have been approached by one of the big global content providers who wishes to offer their video content on exclusive basis over the Closed Electronic Communications Network (CECN) of Airtel, in compliance with the definition given in para 2 (c) of the above referred regulation. Such exclusive content would be offered in India to Airtel’s customers only.

We further submit that while such an arrangement with the global content provider over CECN along with its exclusive offerings to our customers would be compliant to the regulations, it may well be viewed by some stakeholders in violation of principles of Net Neutrality.

Prior to arriving at any business decision on such an arrangement, we request the Hon’ble Authority to kindly advise us if we can go ahead with it.

Thanking you,
Yours Sincerely,
for Bharti Airtel Limited,

Ravi P. Gandhi
Chief Regulatory Officer

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Disclosure: I am a volunteer with SaveTheInternet.in campaign for Net Neutrality in India, and MediaNama has taken a strong position in favor of Net Neutrality in India.

Image credit: Paul Varuni