“… Basically, what the ISPs are trying to do [is that they are] trying to confuse everyone by saying we are not talking about technical discrimination [by introducing network usage fees]. We want to transport every packet in the same way. And the only thing that is different, [is that] some companies pay, and some don’t. But that’s the wrong aspect to look at because the economic discrimination as such violates net neutrality. And interestingly, it’s the same in India,” said Barbara Van Schewick from Stanford University during MediaNama’s ‘International trends in Network usage fees’ virtual event on October 4. Van Schewick’s statement was in response to India’s Cellular Operations Association in India’s (COAI) claim that fair share contribution from OTTs (Over-The-Top platforms) will not violate net neutrality.
On October 4, 2023, COAI shared a statement with MediaNama, where it declared, “…contrary to misguided opinions being floated in various fora, a fair-share contribution from OTTs will not violate Net Neutrality… content and services for consumers will remain fully accessible with no traffic management/differentiation. There will be no throttling, no blocking, no paid prioritization for any service, irrespective of the fair share charge paid. The price for traffic paid by end users will not change depending on whether the traffic generator is subject to fair share payments or not.”
Citing this text, Nikhil Pahwa, Founder and Editor of MediaNama, asked Van Schewick for her response, who has previously testified before the Telecom Regulatory Authority of India (TRAI) and the EU’s telecom regulator BEREC on this issue. Van Schewick spoke alongside speakers: Professor K.S. Park, Co-Founder of OpenNet Korea, Carl Gahnberg, Director of Policy Development and Research at the Internet Society, Alissa Starzak, Vice President, Global Head of Public Policy, Cloudflare and Thomas Volmer, Head of Global Content Delivery Policy at Netflix.
You can watch the entire event here:
MediaNama hosted this discussion with support from ADIF, Google, Meta and Netflix.
Network fees a form of economic discrimination: Responding to the claims of “misguided opinions” made in CAOI’s statement, Van Schewick said that the arguments put forward by the industry body “missed the point” as to how network fees violate net neutrality. She said that it is part of the ‘disinformation playbook’ to repeat the same argument many times without really engaging with the other side’s argument.
Van Schewick said that network fees charge companies that offer services that are so popular that many people use them at the same time. So, while such companies are made to pay network fees, other companies are not, which creates ‘economic discrimination.’
“Treating some companies differently from others is a key net neutrality issue. It distorts competition among application and content providers. That’s what we want to avoid. So, I say this is ironic because both in India and in Europe, we have very clear statements that make clear that this kind of economic discrimination… is squarely covered by the net neutrality protections,” she said.
Net neutrality violations not restricted to technicality alone: According to Van Schewick, the European Court of Justice in 2021 and 2020 took a decision that simply looking at technical discrimination as a net neutrality violation would be “too narrow.” It stated that “ultimately, economic and technical discrimination are just two sides of the same coin.” Prior to this statement, there was a general understanding that if a person speeds up some applications and slows down/blocks some applications, paid fast lanes, then that kind of technical differential treatment violates net neutrality.
After the Court’s decision, the understanding is that a person can harm another by making the other person’s application slower and by charging a fee.
“That’s exactly what the zero-rating plans that the European Court of Justice was looking at was doing. So, the key idea here is that network fees are economic discrimination, and they violate Europe’s non-discrimination rule,” said Van Schewick.
TRAI already established zero rating as a net neutrality violation: According to Van Schewick, India was one of the global leaders in recognizing that zero rating is a net neutrality violation. She said TRAI has said so in its 2016 order on differentiated pricing practices.
“So, in India, too, we don’t have to speculate whether charging some companies and not others engaging in economic discrimination is a net neutrality violation. TRAI has already found that. And so, it doesn’t matter whether there is also blocking or throttling or pay prioritization,” said Van Schewick.
Charging companies for propagating data violates net neutrality: Adding to what Van Schewick said, Professor Park pointed out that not only differential charging of fees but levying fees on any company for propagating data violates net neutrality. His reasoning was that the prioritization of data delivery being conditioned on payment is in itself a financial discrimination since data will not move forward unless the payment is done.
This moves into the sender pay model which, Park argued, fundamentally violates net neutrality that requires all network participants to deliver data packages from their immediate neighbours to their next immediate neighbours, without any charge or condition.
What is the sender pay model? Stamping an envelope to send mail, paying telecom companies to make a call – these are some examples Park used to explain the sender pay model. It essentially means that the sender, the person pushing the data on the network, “burdening the network,” has to pay somebody to have the network deliver the data.
“That condition [for passing on data packages on the internet] cannot be financial, cannot be legal, cannot be content-based. And if any of the network participants start charging for data delivery, then other network participants will start charging. And it will break down this great crowdsourcing mechanism that internet has, where all the network participants can share with all other network participants, all their connections, all their network resources. So, that you don’t charge one another for data delivery, you are only responsible for maintaining connection. That’s what content providers pay under the name of transit to ISPs,” said Park.
Similarly, Park pointed out that termination charges – a delivery charge to ask the network to deliver data to the end – hinder net neutrality. He said that the internet created an ‘information revolution’ by getting rid of the transaction cost of charging for data delivery.
“If charging for data delivery takes place, again, it will create, it will generate a tremendous transaction cost that will just break down the internet,” said Park.
Note: The headline was updated for brevity on Oct 10 ’23 at 11:15 am.
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