You are here: Home » Companies » News
Business Standard

Net neutrality directions to benefit Reliance Jio, Bharti Airtel

Analysts say they will use the content delivery network exemption and offer platform content at lower prices to drive their subscriber base

Topics
Trai On Net Neutrality

Ram Prasad Sahu 

The terrifying power of internet censors
Internet censorship

Recommendations of the Telecom Regulatory Authority of India (Trai) on Net neutrality are broadly in line with its February 2016 regulation prohibiting discriminatory tariffs for data services.

They also bar differential speeds for various offerings by internet service providers. However, the telecom regulator has kept content delivery networks out of the regulation. This means that cellular service providers who have their own content platform and are offering these services on their own network (content delivery networks) can charge differential pricing.

Mayuresh Joshi of Angel Broking says the reason content delivery networks have been kept out of the regulation is that they will not impact competition and are not considered discriminatory.

According to analysts at Edelweiss Securities, the proposed rules are likely to give integrated operators an upper hand versus pure-play connectivity providers. They expect telcos such as Reliance Jio and Bharti Airtel to be key beneficiaries as they have a presence in content platforms. Reliance Jio (JioTV and JioCinema, among others) and Airtel (Wynk Movies, Music & Games) have been creating their own content ecosystem to retain and increase subscribers.

Analysts say they will use the content delivery network exemption and offer platform content at lower prices to drive their subscriber base.

Most analysts believe that rules are in place but Trai has now recommended that licence conditions related to the issue needs to be amended to cover all other types of discrimination.

graph

Regulations related to discriminatory tariff for data services based on content had been addressed by Trai through rules issued in February 2016.

The regulator had ruled in favour of Net neutrality last year and prohibited Facebook’s Free Basics platform and other offerings by Indian telcos that violated this principle.

The prohibition, according to Angel Broking, only applies to discriminatory tariffs based on content. Service providers can offer lower tariffs for all users for a limited period, then that would not constitute violation of Trai’s order, says the brokerage.

Service providers are disappointed, given that the regulator has not made any recommendation for voice-related over-the-top applications, except that separate regulations to deal with these applications be created. Telcos have asked for a level-playing field.

The regulator has also recommended a watchdog for enforcing Net neutrality and has proposed reasonable measures of traffic management. It has also recommended stiff penalties for violations, starting at Rs 50,000 per violation per day. The overall penalty could go as high as Rs 50 lakh, depending on the gravity of the violation.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, November 29 2017. 08:50 IST
RECOMMENDED FOR YOU
.