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Airtel introduces data cashback program, and it is neutral

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Bharti Airtel, India’s largest telecom operator, has introduced a program called Airtel Night, which gives 50% data as cashback to those surfing using Airtel mobile connections at night (Hat tip: Sanjay Bafna). What’s important here is that it illustrates that there are options for providing cheaper Internet access that are neutral in nature, and Airtel has chosen that route, instead of something like Airtel Zero, which it had launched in April this year, and violated Net Neutrality. Some notes:

1. How does it the night cashback program work? Those who use Airtel data connections at night, between midnight and 6 am, will get 50% of data used as cashback, which can be used during the daytime the next day. So far it is available only for prepaid subscribers, and for those who have a valid data pack. The data is credited back to the MSISDN of the user (2G or 3G or 4G from a data pack). Users will receive an SMS every morning (post 0600 hours) with the amount of data cashback that is being credited to their account. The data received as cashback will have the same validity as the user’s active data pack.

2. How does Airtel benefit from this? This essentially allows Airtel to use up unutilized bandwidth capacity at night, when usage is low. Remember that traditionally, ISPs in India also tried to increase Internet usage at night, by offering cheaper night only plans and/or 50% off on utilization of data limits, if usage was at night. Of course, this, given that wireline networks aren’t as screwed up as wireless networks, would have encouraged, erm, video consumption and downloading at night. This essentially encourages data usage, and helps customers who might find existing data packs expensive (and data in India is expensive), sign up.

2. How is this neutral? It is neutral. Data cashbacks don’t dictate which websites you can use for data, and thus do not give a competitive advantage to any individual business over another. It’s not like Airtel Zero, where specific websites were made available for free, because they paid for consumer usage. It’s also not limited to a specific collection of sites being made available for free, which is the issue with Facebook’s Internet.org/Free Basics.

There are data cashback services like Gigato, which offer free data upon usage of specific applications, but as long as no one dictates what the data can use it for, there doesn’t appear to be a problem. Just goes to show that, like Mozilla Foundation’s programs in Africa (free data on purchase of a handset) and Bangladesh (ad supported free data), there are neutral ways of encouraging data usage, and services like Airtel Zero and Internet.org’s Free Basics aren’t the only alternatives.

3. What about Airtel Zero? We don’t know. On the six month anniversary of Airtel Zero, MediaNama had sent queries to Airtel for clarification on its status: whether it is live, whether there are any services live on it, what happened to all the startups that had queued up to sign up for it, and what rates Airtel was/is charging them (we’d heard it was Rs 1/mb, around four times what a consumer pays). We haven’t received a response from Airtel to these queries. That said, Airtel’s submissions to the Indian regulators have pushed for zero rating, so there is no indication that there is a change in Airtel’s stance: there’s only silence. For now.

Note that the TRAI has taken inordinately long to start the open house consultation process on Net Neutrality, and it looks like the process will be delayed further.

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