Why CCI must enter Net Neutrality debate

While India saw heated protests and a debate last week over Net Neutrality -- the call to the Telecom Regulatory Authority of India (TRAI) for strictly separating content (apps) and carriage (data plans), the European Union’s Competition Commissioner took a step forward in another side of the business by charging Google with defying what is called “search neutrality”.

Near-monopolist Google is accused of using its search algorithms to give preferential treatment to some sites -- such as its own shopping site. Or it is being suspected of using its powerful software to copy vital content off niche sites (such as travel search). The jury is still out, while Google’s position has been that it throws up searches on usage-based merit, and is not the only information provider.

It turns out that the Competition Commission of India (CCI) is also investigating Google, and its findings are expected soon.

I think the CCI also needs to step into the Net Neutrality debate. Here’s why.

In the case for Net Neutrality, activists are demanding that Internet service providers (ISPs) should not discriminate against any content or app provider. This also implies that there should also be no preference as preference is nothing but positive discrimination. Bharti Airtel’s Airtel Zero plan that triggered protests essentially favours some apps in exchange for money, which in turn is used to provide Internet access free to willing customers.

Last week, Bharti Airtel defended its Airtel Zero plan in a letter to employees, saying the data plan that offers free Internet access by charging content/service providers (such as Facebook under its Internet.org initiative) was in effect an effort to spread the reach of the Internet.

In essence, the debate in India now is being shifted not to ‘Net Neutrality versus Discrimination’ but ‘Net Neutrality versus Digital Inclusion.’ In the latter definition, two good things are pitted against each other, making it tricky for TRAI or the government. Now, consider the fact that leading apps such as Facebook or Flipkart (which has since opted out of Airtel Zero), are market leaders of some kind and so is Bharti Airtel. A collusion of market leaders in two different segments in essence can be seen as anti-competition.

Also, Bharti Airtel built up its leadership by virtue of cheap spectrum it got from the government (which has since been proven in the 2G scandal and its aftermath).

The big question: can monopolistic or anti-competitive alliances be permitted, particularly when the entities are riding on cheap government resources? Like in the case of Google, the issue is whether something done ostensibly in public interest is essentially a private strategy to boost business or partnerships. This is what CCI has to examine.