Reliance Jio believes that a Net Neutrality exception should be created for “Specialized Services”, payments services, online customer care services. The Indian telecom regulator TRAI is is currently holding a public consultation on whether Internet Service Providers (ISPs) and Telecom operators (telcos) should be allowed to block, slow-down or speed-up certain websites and apps, referred to as blocking, throttling and traffic management. Thus, this consultation about discriminatory speeds of Internet access, and is a follow up to the one concluded last year, which looked into discriminatory pricing of Internet access.

A lowdown on Jio’s current stand:

1. Net Neutrality exceptions recommended by Jio

  • For Specialised services: Jio points out that specialised services “need singular treatment on basis of their requirement for higher standards of quality and network resource requirement. Real time services can be provided separate treatment as long as these services are not at the expense of the regular Internet”…”Specialized services are exclusive high quality and bandwidth services which provide value added services to end users supplementing the benefits of open Internet. Specialized services are not generic and earmarked for specific end usage and applications. This kind of specialized services fosters investment and can benefit all stakeholders, specifically end users.”
    Also, “We also believe that there should be Internet Neutrality, where the service sold is billed as Internet Access without discriminating based on content. However, this should also not bar offering other non-Internet and specialized services over the same physical broadband access and infrastructure.”
  • For enterprise services and managed services: ‘Enterprise services are customised as per the requirements of the respective business and is on the basis of the Service Level Agreements between TSPs and Enterprise, therefore, enterprise services are different from public internet services. Since they are in the nature of private networks rather than public communications, they do not affect Net Neutrality. Managed services, which are perceived as enterprise-related services get the highest priority of QoS along with voice and video. This may be allowed without affecting the minimum guaranteed QoS of “Best Efforts public Internet”. Managed services are necessary requirement for businesses and enterprise, and suitable exceptions may be made for treatment of such services in the Net Neutrality context.’
  • For Customer self-care services: “Customer self-care services should be treated as exception to any regulation on TMPs. These self care services are in customer interest and often customers need priority access to these to maintain their services, recharge etc.”
  • For Digital payment services / financial transactions: Jio feels that financial transactions and digital payment services “should be excluded from any regulation of TMPs, as there is a risk of transaction failures and loss to stakeholders in case there is a delay in connectivity. This would be in line with the Government’s push towards digitisation of financial services in the country.”

Our take: Here’s a question for Jio: Where do we draw the line with such exceptions? Why not telemedicine, since it could save someones life? Why not online MOOCs, since education is a priority? Why not an exception for panic button services? Among “customer self-care” apps, it’s interesting to see Jio include recharges in this mix. That gives the operator recharge service an advantage over third party recharge aggregators like Paytm, Freecharge and others. Or does Jio want to treat all recharge businesses as a “Specialized Service”?

Would live-streaming of a Mumbai Indians IPL game be considered a “real-time” service, and a specialised service, and hence given an exception regarding Net Neutrality rules? What has Jio not done in case of “Specialized Services”? Given examples of what would constitute one. However, Jio does cites the BEREC (European Union) ruling on Net Neutrality, saying that it allowed exceptions for specialised services such as “Internet TV and new innovative applications“.

In addition to this, it’s questionable why an exception should be created for enterprise and managed services. The purpose of licensing of spectrum is to ensure that there is a public need which is met: that of access to knowledge, communication and freedom of expression. The networks should not discriminate between users, whether they are enterprises or individuals. This allows individual users to compete on the basis of equal treatment from ISPs and TSPs. More on this here, from Prof Ajay Shah.

Also, the list specialised services could be ever expanding. The list of services that meet the government agenda can be ever expanding. It is sneaky of Jio to ask for an exception for digital payments, given that the current TRAI Chairman, RS Sharma, was previously leading the UIDAI (Aadhaar) project, and has looked at ways of ensuring that policy formation assists seamless digital transactions and Aadhaar authentications. It’s a reasoning that comes up often in his speeches.

But really, the agenda of the government from the perspective of Internet access should be to grow connectivity, and push telecom operators to deploy sufficient infrastructure so that we don’t have capacity issues that require prioritisation.  As it is, Idea and Airtel have said on their conference calls that they have sufficient capacity. Grow the pie, not split the pie.

Also read: Reliance Jio’s submission on the first TRAI Net Neutrality paper, where it suggested regulation for all Internet companies

2. Case-by-case approach: Jio has gone back to the approach that the TRAI rejected earlier, of suggesting a case-by-case approach to dealing with Net Neutrality violations. It says “A national committee can be structured under the aegis of the TRAI to deal with issues related to Net Neutrality on a case to case basis. The committee should have representation from various stakeholders (TSPs, content providers, consumer groups etc) to ensure a more collaborative approach. The committee will have recommendatory powers.”

It justifies this by pointing towards regulations in other jurisdictions, including the US and the EU, saying “Even those markets that have adopted open internet regulation, have often opted for case-by-case assessment of such practices. For example, TSPs and end users are free to conclude commercial agreements under the recently adopted Open Internet Regulation of the European Union, unless such practices are assessed to have material impact on consumer choice.” It points towards the US FCC saying that they allowed “Existence of specialised services and case to case evaluation of adherence to the principles of Net Neutrality”.

Our Take: This goes against the TRAI’s own approach to Net Neutrality regulation. In its ruling on differential pricing, the TRAI had noted:

Intuitively, the case-by-case approach may seem reasonable. However, this approach creates substantial social costs as noted by Barbara Van Schewick in “Network Neutrality and Quality of Service: What a NonDiscrimination Rule Should Look Like,” Stanford Law Review, 2015.

First, a case-by-case regime will fail to provide much-needed certainty to industry participants. In the absence of a clear rule setting out the permissible and impermissible business practices, service providers may refrain from deploying network technology. This would be due to the fear that their conduct may subsequently be construed as being discriminatory as per the case-by-case analysis.

Second, it will create high costs of regulation on account of the time and resources that will be required for investigating each case. It will also lead to further uncertainty as service providers undergoing the investigation would logically try to differentiate their case from earlier precedents.

Third, there is also the concern that this approach provides a relative advantage to well-financed actors and will tilt the playing field against those who do not have the resources to pursue regulatory or legal actions. This may include end users, low-cost innovators, start-ups, non-profit organisations, etc. The Authority believes concerns are significant.”

3. Net Neutrality principles:  regarding Net Neutrality principles, Jio says that the TRAI should take: “a rational approach, meeting developmental goals, recognition of the need of traffic management, making available the Internet as it is on a minimum level of QoS assurance, availability of all legal content, no gatekeeping, no illegal blocking or throttling, same service same rule principle, no paid prioritisation and acceptance of specialised and managed services on the same physical broadband medium.”

Our take: It’s noticeable how, right at the end (marked in bold) Jio slipped in instances that would violate Net Neutrality. A large number of the suggestions are valid, but the same-service-same-rule principle is a classic telecom operator argument for charging separately for different Internet services, more notably: charging for Internet based voice calls, in the same manner that they charge for traditional voice alls. Given that Jio is giving voice calling free, why is it taking this approach? Other instances that violate Net Neutrality: accepting that “specialised and managed services” that ride on Internet bandwidth and spectrum should be accepted as different from Internet access.

4. Regulatory approach: “Light touch regulation and forbearance mechanism will be the key to effective Net Neutrality principles.”

Our Take: This is exactly the approach that the TRAI should not take, and chose not to take in case of the discriminatory pricing ruling on pricing of Internet access, which looked into zero rating. There was a specific order, and no forbearance. There is no reason why the TRAI should wait and watch for something to go wrong before it acts. Clear principles for Net Neutrality were created during the differential pricing ruling, and should be adhered to.

5. Disclosure norms: Jio says that it is difficult to attribute degradation in quality of service to blocking/throttling or preferential treatment, and the government should lay down disclosure norms and allow grievance redressal mechanism. In addition, it says that “TSPs should be mandated to provide broad principles of traffic management on their website, and TRAI may seek additional details on a case-by-case basis.”

6. Caching and CDNs: Jio supports local caching of content: “Networks need to prioritise certain packets, say for essential services or caching servers for particular type of content and need to block certain packets identified as being harmful to the network. Indeed, the Internet has grown, matured and flourished in an open environment characterized by competition, cooperation and adaptation. Taking extreme positions on the principles of Net Neutrality may have adverse implications such as prevention of efficient practices like local cache of content etc.”

It also believes that CDNs should be allowed, saying  that “Content providers are linked to the Internet by TSPs/ISPs. Content Delivery Network (CDN) is now used by many online service providers to move content to the edge of the Internet and closer to the end user. It uses the overlay network before being offered for Internet access, to prevent the quality of services being impacted by traffic congestion in the Internet core. Some of the third party CDN providers such as Akamai, Edgecast, Google, Yahoo etc have developed their own CDNs to deliver their content faster to the end users, whereas some of the CDN providers also get into mutual agreements with large ISPs to improve user experience. RJIL believes that CDN is a normal business activity wherein one service provider offers its CDN to others.

7. The good stuff: Jio says that the TRAI should specifically prohibit certain practices, instead of creating a list of permitted practices, which it says will lead to over-regulation. It suggests the following as “Non reasonable practices”:

  • Throttling of speed of services offered by a competing operator.
  • Blanket filters on some kinds of content (say gaming content)
  • Giving differential access to applications, content or services to CDN or cache facilities and thereby throttling them
  • Blocking or termination practices that are applied at the transit node without user choice.

In addition, Jio also suggests that:

  • No exploitative or anti-competitive traffic management
  • application agnostic control for legitimate network management may be used, but application-specific control may not be permitted.
  • Improper (paid or otherwise) prioritisation may not be permitted.

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Note: I was a co-founder of the SaveTheInternet campaign for Net Neutrality in India. I’m also a co-founder of the Internet Freedom Foundation, albeit, currently on the sabbatical from the organisation and not involved with any decision making or current campaigns.