Sachin Bansal, CEO of Flipkart has given an interview where he defends Airtel Zero while claiming to be supporting Net Neutrality. While doing so he makes a number of claims that do not sound genuine upon close scrutiny. Let’s start.
Bansal claims Flipkart is in favour of Net Neutrality. He states
//We do not support anything that could discriminate one company or service over the other by creating roadblocks that compromise the experience that they promise to offer.//
Well that’s what Airtel zero does exactly. It gives free Internet access to certain services – based solely on their ability to pay for the privilege. You can’t get that preferential treatment until you have the deep pockets. And it’s not about marketing. Once users get access to a bunch of services for free they will not be inclined to buy a separate data pack that allows them to access any other site that is not on the zero rating platform. Essentially shutting them off on that network.
He further states –
//So we support innovations that not only encourage more users to join the Internet but also experience a range of services at no additional cost;//
Encouraging users to try out the wonders of Internet at no additional cost is a good thing, but the caveat is that it only allows access to services whose owners have a billion dollars in bank! Sure you they throw in a few free services like Wikipedia and that’s that!
On a question about whether Flipkart has joined the Airtel Zero platform, Bansal said they haven’t yet and they are still talking to them. He further argues that they are not asking for preferential treatment from Airtel.
//We are certainly not asking for any special packs or regulating the speed of the connection//
Speed of the connection may not be an issue today but it will certainly be an issue tomorrow.
He further makes a case for Airtel zero being “open”
//From our discussions we know that the product construct is that of an open and democratic platform that can be accessed by any Internet company and is completely within the ambit of prevailing laws.//
Yes any Internet company that can pay millions for it per year. Pocket change really. And it is completely within the ambit of the laws that were made in …. wait….in 1885.
Bansal makes repeated assertions that this is all about making Internet cheaper for the masses
//I hope the government takes a balanced approach to this. I believe this will make cheaper Internet accessible to more people//
But the fact is it actually divides the Internet into two – free and premium. And the free plan is a rich boys’ club.
And then Mr. Bansal goes onto make a preposterous claim –
//Zero rating has been around for over five years now and many global services like Facebook, Twitter, Wikipedia, Amazon, Google, etc. have and continue to make use of it in India. To us, it’s surprising and a quite disappointing that it is somehow wrong when Flipkart, a local Internet company, considers it.//
As we have pointed out in an earlier post, the earlier zero rating deals were limited in scope and were limited to a single service on a single operator and for a limited time. Airtel zero on the other hand is much wider in scope having far-reaching consequences. By very nature of it it forces companies to be part of it if their competitor joins in, and the more companies join it, the more leverage the platform gets.
And what’s with playing the victim card? MediaNama has gone to great lengths to explain how Facebook’s Internet.org is anti Net Neutrality. Please stop cribbing. No other earlier deal has been so pervasive in scope. Airtel is the largest telecom company in India with 200 million plus users. It makes a great deal of difference when that company tries to divide the Internet into free vs premium.
// Most people wrongly believe that Flipkart is asking for preferential treatment. In reality we are only asking for equality with our global peers and are NOT asking for any preferential treatment.//
No, you are not asking for equal treatment. Equality will mean either everyone pays to access all the sites on the Internet or all the sites are free. You may not have asked Airtel for preferential treatment but when Airtel came to you with the offer you chose to jump on it. Because it makes perfect business sense for you. It closes the Internet for your competition giving you an unfair advantage.
When asked about if zero rating is anti Net Neutrality, Bansal has this to say –
//We believe that the proposed platform is open and democratic and every Internet company, big or small, has access to it. Considering that there is no preferential pricing or any move to curtail bandwidth for those services that are not on the platform it eventually comes down to choice. If an organization wishes to encourage Internet users to fully experience the product or service at no extra cost, zero rating makes sense.//
That is a complete hogwash! Every Internet company that has truck load of VC money has access to it. There may not be preferential pricing with regards to what Airtel charges companies to be on the zero rating platform, there is a difference between what Airtel charges consumers to access OTHER services which are not on the platform which is paid vs free.
Then Bansal goes on to make 3 points arguing why zero rating doesn’t violet Net Neutrality. Two of them actually are contradictory. Consider this –
//Zero rating is something that can’t scale to impact all user data and the whole of the Internet…. The per MB cost of data that will be borne by Internet companies on a zero rating platform is many times higher than what users pay//
Well if a telco is making more money by charging companies to offer free data to users why would it bother to improve things for consumers? It would rather actively push its paying consumers to be on the zero rating platform so it can wring more money out of companies. It makes perfect business sense.
He then asserts again that what they are doing is not illegal yet.
//The laws in India today don’t see zero rating as something that impedes competition.//
The laws are not clear, so to make it completely legal TRAI has come out with a lengthy 100+ page consultation paper soliciting responses from general public on 20 over complicated and technical questions.
Finally Bansal states that people uninstalling Flipkart app is hurting. So they have taken notice. We hope good sense prevails and Flipkart backs out of this deal. Flipkart has done phenomenally well since its inception and has held it’s number one crown in the face of competition from a global giant like Amazon. It does not need an anti competition closed platform like Airtel zero to thrive.
Airtel zero is against the very nature of openness of the Internet and Mr. Bansal you know it very well.
[Image Src: Flickr]
This is the right decision made by Mukesh Bansal at right time. Being an entrepreneur one should not think only about his profits, he should also think about the drawbacks and their intensity of the project.
[…] Earlier, Sachin Bansal had tried to reason their support for Airtel Zero by comparing it with toll free numbers and other such services. His response was again ridiculed and ruthlessly opposed by activists of Net Neutrality. […]