Freeness: why the Caribbean ought to be vigilant about zero rating net neutrality

A discussion zero rating net neutrality and why the Caribbean ought to vigilant about it.

For those who have been with us from the beginning, you may recall that one of our earliest articles here on ICT Pulse was on Internet (net) neutrality, and we have been keeping tabs of the debate over the years. Since our launch in 2011, net neutrality has escalated in importance, and recently, there was a landmark ruling by the United States (US) Federal Communications Commission (FCC) in support of net neutrality.

Essentially, the US ruling, which to varying degrees is consistent with that adopted by a number of developed countries worldwide, bans practices that could harm an Open Internet, such as blocking, throttling and paid prioritisation (Source: FCC). All of those actions can be construed as “negative discrimination” – where a telecoms carrier penalises specific customers or service providers, and not others. However, many of the regulatory rulings to date have been silent on what should obtain when positive discrimination – in the net neutrality context – has occurred.

This positive discrimination, which is also known as “zero rating net neutrality” has been a grave point of concern in the net neutrality debate. Though it might appear innocent, it has been argued that it still undermines net neutrality by giving select parties a distinct advantage over others.

What is zero rating net neutrality?

Unlike “fast lane discrimination”, where telecoms carriers charge content providers (for example) a premium for increased bandwidth and/or priority access, “zero rating” speaks to customers accessing to certain services for free, usually on a mobile/cellular device. Hence use of those specific services, for which special arrangements would have been established between the carrier and the content provider, would not consume any data under a subscriber’s mobile/cellular data cap allowance, whilst other similar services would not enjoy the same privilege.

In the Caribbean, some of our mobile/cellular carriers have established preferred arrangements with content providers. A prominent example is the fact that Digicel’s mobile Internet customers across the region enjoy free access to Facebook, Instagram, WhatsApp, Wikipedia and Twitter, thus freeing up their data cap allowance be used to access other sites and content.

It is free, what is the problem?

At first glance, it could be argued that Digicel has done a good thing by permitting free access to certain online properties. There are still large portions of our population across the region who cannot truly afford mobile/cellular Internet service; hence free access to select content can stimulate interest, and provide an opportunity to experience the benefits of being online.

Although the argument could be made that this free access is narrowing the digital divide, the difficulty lies in its effect on the wider ecosystem:

  • The mobile/cellular carrier has established preferential arrangements with certain online properties
  • Frequently, these preferential arrangement are not transparent, and are held in commercial confidence
  • Online properties that do not have an arrangement with the mobile/cellular carrier are at a distinct disadvantage, as mobile/cellular data must be consumed in order to access to their services
  • Free access to certain content tends to elicit a change in customer behaviour and a preference for those free sites.

At the core, the mobile/cellular carrier is discriminating against certain online properties and/or content, instead of being impartial and allowing equitable access to its subscribers.

Further, in this digital age, traffic – the number of visitors accessing websites and content – is a key measure of success. Hence environments that support zero rating net neutrality, be it implicitly or explicitly, are essentially supporting the throttling of certain online services and content.

A Caribbean-specific concern

In the Caribbean, we have a small but growing tech space, where software developers and entrepreneurs are creating applications and services, many of which require access to the Internet and/or are designed for mobile/cellular devices. However, unless they enjoy preferential arrangements with a mobile/cellular carrier, similar to what the carrier has established with other platforms, they may inherently be marginalised.

Further, a carrier could seek to leverage the control it wields regarding customer behaviour by instituting certain demands when negotiating preferential arrangements with content providers. For our local and regional start-ups and small businesses, they may be at the mercy of the carrier and find themselves having to accept less than favourable conditions in order to secure some visibility among the carrier’s subscriber base.

In summary, although zero rating net neutrality can benefit end-users, it introduces inequity in how content providers are treated. It could also be argued that zero rating net neutrality tacitly fosters censorship, as telecoms infrastructure and access carriers are in a position to promote certain content over others.

 

Image credit: Sean Weigold Ferguson (flickr)  

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3 Comments

  • So here are my thoughts on zero rating… I think that in a mature and competitive market where universal access has pretty much been achieved, zero rating can be seen as picking favorites and using the intelligence in the network to establish competitive advantage. In this context, it can be viewed as a violation of the ‘end-to-end principle’ and a net neutrality issue. Conversely, in an emerging economy with very limited Internet access, low competition and high prices, zero rating can actually be a good thing and serve as an enabler of ICT-based development. For example, it allows people to access the Internet (albeit with limitations to Facebook, Wikipedia, etc.), broadens the availability of online education resources, and increases the individual’s aptitude for using and benefiting from the Internet. Hope this makes sense.

    • Hi Niel,

      I fully appreciate what you are saying, and even alluded to it in the article. Offering access for select online platform, can help to promote and expose persons to the Internet, who might not otherwise get that experience.

      However, there perhaps also ought to be a recognition of longer term consequences, and thus more informed decision making by our regulators and policy makers.

      Question: could we balance two seemingly countervailing positions? Any thoughts?

      • Hello Michele,

        Balancing the two opposing positions is difficult, but not impossible. A couple of thoughts…

        1) Regulators have to understand the industries that they are tasked with overseeing, and decide where they are along the continuum of development (particularly around universal access). Hence, they can decide where zero rating as a consumer and developmental benefit begins and ends.

        2) Regulators also need to understand where and when zero rating is contributing to market distortions. For example, ISPs could be prohibited from zero rating their own services to the disadvantage of their competitors (e.g. Comcast zero rating its Xfinity App for streaming video, but having Hulu, Netflix and others count towards data usage). Another scenario is where an application provider pays an ISP to zero rate its application, but these revenues are not then passed on to the consumers through innovation, service enhancement, and performance improvements. Moreover, new entrants cannot “pay for play” and this affects competition as well. The final scenario, which might me the most palatable, is zero rating all applications in a certain class and not allowing application providers to “pay for play”. This doesn’t provide any distinct competitive advantage, and allows users to increasingly use and access the Internet for a particular class of applications without it counting against their data cap.

        3) Finally, regulators could restrict zero rating to purely developmental applications such as Wikipedia, Google, mobile payments, e-government, m-fisheries, library-based services, etc.

        What do you think?

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