On February 8th, the Telecom Regulatory Authority of India (TRAI) issued the ‘Prohibition of Discriminatory Tariffs for Data Services Regulations, 2016’ thereby disallowing service providers to charge discriminatory tariffs for data services based on content being accessed by consumers. The key points of this regulation can be important for your upcoming competitive exams.

Therefore, in this article we will take a look at some of the important takeaways from TRAI’s recent report.

Background:

In December 2015, the TRAI had issued a consultation paper on ‘Differential Pricing for Data Services’ seeking views of all the stakeholders on whether service providers should be permitted to charge differential tariffs based on the websites/applications/platforms being accessed on the Internet. Taking into consideration several insightful responses, the TRAI has issued regulations to ensure that users in India have open and non-discriminatory access to the Internet.

Highlights of the TRAI regulation:

1. No service provider shall offer or charge discriminatory tariffs for data services on the basis of content, source, destination or application.

2. In order to evade the prohibition in this regulation, no service provider shall enter into any arrangement, agreement or contract, by whatever name called, with any person, natural or legal, that has the effect of discriminatory tariffs for data services being offered or charged by the service provider.

3. However, service providers are permitted to reduce tariff to provide services during emergency situations and this has to be reported to TRAI within seven working days.

4. Financial disincentives – Companies will have to pay ₹50,000-a-day penalty to a maximum of ₹50 lakh on violation of the stipulated norms.

5. For the time being, intranet has been excluded from the purview of these regulations.

6. TRAI will closely monitor implementation of the rules and may review the same after two years or even earlier as may be deemed fit.

Conclusion:

* The telecom regulator’s decision is a big victory for those in favour of Internet neutrality, which essentially means that all websites and data on the Internet should be treated as equal.

*However, telecom companies and tech giants such as Facebook have contested it. Rajan Mathews, Director-General, Cellular Operators Association of India (COAI), said, “By opting to turn away from this opportunity, TRAI has ignored all the benefits of price differentiation that we had submitted as a part of the industry’s response to its consulting paper, including improving economic efficiency, increase in broadband penetration, reduction in customer costs and provision of essential services among other things.”

*A Facebook spokesperson expressed disappointment asserting, “Our goal with Free Basics is to bring more people online with an open, non-exclusive and free platform. While disappointed with the outcome, we will continue our efforts to eliminate barriers and give the unconnected an easier path to the internet and the opportunities it brings.”

*People in support of Net neutrality have wholeheartedly backed this development. Rajeev Chandrasekhar, Member of Parliament, said, “This is a big win for Indian consumers. The days of telcos controlling regulatory policy are over.”Arpita Pal Agrawal, Leader – Telecom, PwC India has said that TRAI regulation adheres to the notion of non-discriminatory access to Internet. “What remains to be done is to find innovative ways to actually get all citizens access to this Internet as India’s ranking in universal broadband access is abysmally poor and the digital divide continues to widen,” she added.

*Further, TRAI contested the idea that differential pricing will allow telecom service providers to provide innovative packages to consumers. It added, “Given that a majority of the population are yet to be connected to the Internet, allowing service providers to define the nature of access would be equivalent of letting TSPs shape the users’ internet experience.”

*As a majority of the Indian population still lack access to the Internet, it can be concluded that it is not viable to allow service providers to charge differently for the content.

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