Project Report on:

NET NEUTRALITY
Subject:
Management Information Systems
Submitted to: Dr. Abhishek N. Singh
Institute of Management Technology,
Nagpur

Group No: 8 (Section F)

Nikhil Gokhale
Nitesh Girdhar
Nitesh Roy
Pankaj Ahlawat

2015349
2015350
2015351
2015352

Net Neutrality, two most prominent words of 2015, in India. Agitations, online petitions, laws,
reversal of laws and lot of chaos happened in our country over these two words. So, what exactly
was net neutrality? Why were so many Head Honchos and ISP giants against it? What was
Facebooks contribution to the entire fiasco? The following report shall help the reader to
understand the basics of the topic, enlightening the reader on the above mentioned points in a way
best suited as to why every individual in India would have suffered it TRAI wouldnt have passed
the new law.
So what is Net Neutrality?
Net NeutralityDefinition- The principle that Internet service providers should enable access to all content and
applications regardless of the source, and without favouring or blocking particular products or
websites.
Net Neutrality also known as network neutrality, Internet neutrality or net equality is the principle
where ISP and governments should treat all data on the internet equally without discriminating it
on the basis of user, content, type of communication, attachment or the origin of the website. It is
gaining huge support all around the globe as the users want all the contents on the web to be
available to them without being differentiated on the basis of being charged differently. Net
neutrality is an important component of Open Internet. Open internet means every content on
the internet should be freely available to every internet user and can be operated on easily and
accessed by every individual or company. Net neutrality is against the concept of bandwidth
throttling (diverting traffic to a particular network) and rate limiting (rate at which traffic is sent
to a network). Issues pertaining to net neutrality are1. Discrimination by protocol- It is the process of favouring or blocking information based
on type of protocol being used for communication.
2. Discrimination by IP address- Originally developed to filter malware is now used to
discriminate between different types of data.
3. Favoring private network- This is what free basic is all about.

So what was Facebooks contribution to the fiasco? And what is this free basics?
Free Basics:
Free Basics introduced by Facebook provides people with easy access to limited services on their
mobile phones in markets where internet access may be less affordable.
Internet.org which was launched earlier in August 2014 was renamed as Free Basics in September
2015. According to Facebook, it provides an open platform that gives Indian developers the
opportunity to make their services and websites available free of cost to those who cannot afford

internet access. However, this free access is limited to partner websites and applications. It was
launched two years ago globally in partnership with Samsung, Ericsson, MediaTek, Opera
Software, Nokia and Qualcomm.
The websites are available for free without data charges, and include content on things like news,
employment, health, education and local information. The main motive of free basics is by
introducing people to the benefits of the internet through these websites, to bring more people
online and help improve their standard of living.

Mobile Operator Partnership Program:

Free Basics provides Mobile Operators with a sustainable program that addresses each step of the
new subscriber journey. The program begins by educating people on the benefits and value of the
internet. Initially it is free for till he understand the internet and are engaged, this initiative would
help their partners to sustain their new usersover 50% of people who use Free Basics pay for
data and access the broader internet within 30 days.
They provide a robust infrastructure to the operators which makes it easier for them to complete
the integrations and technical work required to launch Free Basics on their network.
Free basics in India:
Facebook launched the initiative in India in February 2015 by partnering with Reliance
Communications. RCom offers the Free Basics service under a Freenet button on mobile phones.
It started with free access to select 33 websites across Gujarat, Maharashtra, Andhra Pradesh,
Telangana, Tamil Nadu, Kerala and Goa. This was subsequently increased to 80 websites.
Free Basics Violates Net Neutrality
Ultimately decided by TRAI that Free Basics violated net neutrality by essentially creating a
"walled garden" in which Facebook would control who could get in. Facebook, a longtime net
neutrality supporter, has argued that some Internet is better than no Internet and it in no way sees
Free Basics as a violation of net neutrality. Charge customers higher rates for VOIP services. By
using free basics customer will be able to access to small subset of internet which is against the
objectives of Net Neutrality. Customer wont be able to access that arent approved by the
Facebook itself.
India and Net Neutrality:
India, a country with 400 million internet users. Differential pricing for each website or internet
service provided could cause a huge hike in the revenue of the Internet Service Providers (ISPs).

Currently the leading ISPs in India (according to internet subscriber base) are: Airtel (82.59
Million), Vodafone (66.84 Million), Idea (37.17 Million), Reliance (35.56 Million) , BSNL (32
Million) [1] . It is a clear picture that with a small decision of differential pricing could cause huge
impact on the revenue models of the ISPs. ISPs like Airtel, Vodafone and reliance did actually
vouched for this differential pricing in the name of covering up their operational expenses and
losses incurred due to VoIP apps like WhatsApp and Skype and lowest tariffs around the globe.
But these claims were proved to false by various industry experts and the economic head honchos.
In February 2012, at the World Mobile Congress held in Barcelona, the CEO of Bharti Airtel, Sunil
Bharti Mittal suggested that services like YouTube should pay an interconnect charge to network
operators, saying that if telecom operators are building highways for data then there should be a
tax on the highway [2]. They also claimed that the websites like YouTube and the like would
actually take a lot of data and the users would ultimately complaint to the ISP regarding the unfair
consumptions. Profit sharing with Facebook and google too was one of the suggestions of Director
of Airtel. As a result of debate Skype was termed as illegal in India by V. Srinivasan, Chief General
Manager, BSNL (AP) [3].
Come 2014, the Telecom Regulatory Authority of India (TRAI) abolished the claims of ISPs for
profit sharing. However by the end of the year, Airtel had actually introduced plans to exclude the
VoIP data from their internet packs and tried to charge extra for per KB consumption by the users.
This was done as there was no preceding law under TRAI for charging differently for different
app usages. However, succeeding this there was a huge media outburst and retaliation towards
Airtel on social networking sites like Facebook, Twitter and Reddit. Looking at the lucrative
market in India, in February 2015 Mark Zuckerberg, the CEO of Facebook brought about an idea
of FreeBasics in India along with Reliance. Although this sounded like an initiative to avail internet
services to the common man and the rural population it actually came with a flaw. The flaw being:
1) Limited number of sites could be listed to the free internet bookmarks,
2) Facebook gets to choose which site shall be on this list,
3) the content on the websites would be the lite version i.e. no videos, photos would be present on
the websites.
4) the users first have to log on to Facebook and then only theyll be able to avail the services of
FreeBasics.
With the dawn of 8th February 2016, the TRAI launched its official law saying: the ISPs cannot
have a differential pricing strategy to any consumer. Thus making Free Basics and platforms like
Airtel Zero Illegal in India. They also contemplated the following:

No service provider can offer or charge discriminatory tariffs for data services on the basis of
content.

No service provider shall enter into any arrangement, agreement or contract, by whatever name
called, with any person, natural or legal, that the effect of discriminatory tariffs for data services
being offered or charged by the service provider for the purpose of evading the prohibition in
this regulation.
Reduced tariff for accessing or providing emergency services, or at times of public emergency
has been permitted.
Financial disincentives for contravention of the regulation have also been specified.
TRAI may review these regulations after a period of two years.[4]

Impact of Net Neutrality on :

ISPs (Internet service Providers) : No gatekeeping on the usage of net packs. Users can freely
access any data from any website, anytime, anywhere without worrying about paying extra, slow
speed, or losing their favorite web site from the internet. Which otherwise would have caused few
vital and most used websites and apps like Wikipedia, WhatsApp to either be given slow or
negligible speed. Forcing the users to either switch to another similar sites or paying exorbitant to
uses their already free services.
Websites: Wikipedia, a website which runs on donations is a vital website for any information
gatherer. Sites like these who would have not opted to pay extra to the ISPs could have received
very low speed. Thus making it extremely difficult for the coming generations to avail the services
of such a common knowledge sharing website. Blogs, local News Channels and other allied small
and fragmented website benefitting the smaller strata of the society could have been forced to close
down. Opinion leaders could not have been able to spread their thought process over products and
thereby causing loss to both the brands in the marketing world and the consumer base. Online Job
Portals like Monster.com and the like could have been suffered from the wrath of the decision of
gatekeepers and thus limiting the access to the HRs around the globe and able but unemployed
personnel.
Users: Price Differential would have been the biggest burn in the pockets of the Indian Internet
consumers. every website would had been charged differently. Forcing the consumers to limit the
choice. Online shopping to Knowledge sharing websites would have been charged in such a way
that benefit the ISPs rather than the people. Certain free and vital apps like Lime, WhatsApp and
the like would have been charged extra per KB of usage. The ISPs could get the authority to limit
your net usage as per their will and wish. The rural India would have been in the most loss, as the
limited net speed upon that the charges would have discouraged the users to speed ahead in all the
fields alike agricultural knowledge provided by the Government of India, HULs Project Shakti
kiosk etc. which would have benefitted the farmers to huge extent.

Impact of Net Neutrality to Apps, Cross platform mobile messengers (Whatsapp) :

Benefits to Consumers
The news is both good and bad for users of free online messaging services like WhatsApp, Viber,
Hike, and Skype, and worrisome for social media giant Facebook.
A high-level government committee supports the free-messaging services and goes to the extent
of saying all impediments in their path must be removed.
The FCC believes these three bright-line rules will protect the virtuous cycle of industry
investment and innovation in Internet content and hardware infrastructure and ensure there is fair
access to consumers for what they pay for: Access to all locations of the Internet where there is
legal content they want access to; and for content providers, fair access to the ISPs network so
that the content can be delivered to the consumer. To enforce these rules, the ISPs are ordered to
provide transparency to consumers and content providers about the services received and the
network management practices.
Notice the non-discriminatory rules apply only to legal content, which leaves the door open for
ISPs to block or throttle illegal content, providing a new avenue to combat piracy and cybercrime.
Prior to this, regulators disapproved throttling of any content, including illegal content that violates
copyright.
Adverse Effect on Consumers
If there is no Net Neutrality, one will have to pay the price for telecom majors choosing to focus
on network building (earning huge sums of money in the process) rather than focusing on building
applications that OTT services like Skype and WhatsApp have milked to the maximum.
Now, if the OTTs dont pay what telcos want them to, your messages will deliver slower and
videos will take longer to download.
The main controversy regarding these bright-line rules is that the paid prioritization ruling will
thwart innovation and infrastructure investment by ISPs. The argument is that, by not allowing
ISPs to charge extra fees to heavy users of the network like Netflix, they will have less incentive
to invest in infrastructure because it is harder to monetize, and consumers will instead foot the bill.
So consumers: get ready to pay more for Internet access, and expect lower download speeds due
to congested networks.
Calling your friends/relatives
If you use Skype, Viber, WhatsApp or any other VoIP platform to call your friends or relatives
living abroad, then you can continue to do so. VoIP calling abroad will continue to operate as it
currently is. Unfortunately, there is a difference in the suggestion by the DoT panel report on
domestic VoIP calls. Effectively, it might just be cheaper to call your friend abroad than in the
same city. Although the decision is seen by many as the government siding with these apps; in
reality, its more about safeguarding interests of the telecom industry. Telecom service providers

within India have invested heavily in spectrum and the industry believes it is vital to ensure a fair
level playing field in the domestic voice market.
Effectively, using OTT services such as WhatsApp, Viber or Skype to place voice calls in the
domestic market would hurt the domestic telecom market.
You could message as much as you want
The above differentiation between India and global calls has been made only for voice services.
For messaging, the DoT report has emphasized on users right to a free internet. It would continue
to enable free and fair access to the ability to message domestic or locally using OTT services. So
you can continue to use WhatsApp, Skype, or the number of similar services out there to message
as much as you want.

The Verdict:
TRAIs landmark ruling against differential pricing, believe it or not, is for your benefit.
TRAI has asked operators to charge users only for the data they use in turn banning zero-rated
services. And here is what it means for you:
1) The ruling states that no service provider shall offer or charge discriminatory tariffs for data
services on the basis of content. This means that your internet service provider will not be able to
charge you separately for making VoIP calls using an app like Skype and can only charge you for
the data you consume in terms of upload or download.
2) Also, this means that data packs offering certain free usage of sites or apps like WhatsApp and
Facebook will cease to exist. There will be only one kind of data pack which will offer certain
megabytes or gigabytes of usage in return for a specific amount of money. This means that you
can watch videos on any website or use any app or service for the same price on the operators
network.
3) TRAI also ruled that 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 for the
purpose of evading the prohibition in this regulation. This clause of the ruling makes sure that no
operator can find any loophole to tie up with a person, service or app and charge you more for
offering such services.
4) TRAI also made sure that there is an open road to access this services at a lower price in an
emergency situation. In its ruling it noted that reduced tariff for accessing or providing emergency
services, or at times of public emergency has been permitted. This means that companies, only
during emergencies, can zero rate their services to provide assistance to resolution of the issue.

References:
1) http://www.trai.gov.in/WriteReadData/PIRReport/Documents/Performance_Indicator_Re
port_Jun_2015.pdf
2) http://www.cnet.com/news/mobile-operators-stop-picking-on-us-or-else/
3) http://www.thehindubusinessline.com/info-tech/as-debate-over-net-telephony-rages-govtto-reexamine-services-offered-by-skype-google/article4404537.ece
4) http://www.trai.gov.in/WriteReadData/WhatsNew/Documents/Regulation_Data_Service.
pdf
5) https://info.internet.org/en/story/free-basics-from-internet-org/
6) http://www.business-standard.com/article/companies/10-things-to-know-about-facebooks-free-basics-net-neutrality-115122300326_1.html
7) http://www.hindustantimes.com/tech/govt-net-neutrality-report-backs-whatsapp-viberskype/story-8T242C0T8ua9O0HtbWUl9K.html
8) http://www.forbes.com/sites/nelsongranados/2015/06/11/net-neutrality-goes-into-effectwhat-consumers-should-expect/#586c2ab45e53
9) http://www.rediff.com/news/report/faq-whats-net-neutrality-how-does-it-affectyou/20150416.htm
10) http://tech.firstpost.com/news-analysis/net-neutrality-report-you-can-make-skypewhatsapp-calls-abroad-not-within-india-industry-reacts-274348.html
11) http://www.hindustantimes.com/tech/what-trai-s-verdict-on-net-neutrality-means-foryou/story-lhZrw52UkQkdB8Di5GY6FP.html