In a landmark move, major telecom operators, including Reliance Jio, Airtel, and Vodafone-Idea, have urged the Telecom Regulatory Authority of India (TRAI) to make internet companies contribute towards the costs of network infrastructure.
Jio, the telecom behemoth with over 450 million subscribers, spearheaded this call by suggesting that internet companies should compensate based on various metrics such as data usage, turnover, and user base. Airtel and Vodafone-Idea echoed these sentiments. Airtel went a step further, suggesting that only the largest internet entities should bear the brunt of these costs, thus allowing smaller startups to continue to grow unhindered.
India boasts one of the world’s largest wireless markets, yet the average revenue per user (ARPU) is astonishingly low, around $2 per month, placing the nation in the bottom 5% among low-middle and low-income countries. Telecom companies invested $19 billion last year for 5G airwaves and are grappling with ways to improve their profit margins.
The recommendations have sparked a heated debate about net neutrality. Critics like Nikhil Pahwa warn that obliging internet companies to pay network fees could lead to potential violations of the principle of net neutrality, which ensures free and equal access to the internet.
The Asia Internet Coalition, which represents tech giants like Apple, Google, and Amazon, also opposed these suggestions, stating that such cost-sharing measures could hinder technological innovation and ultimately burden the consumer.
In defense, Jio asserts that their recommendations are within the boundaries of net neutrality principles, focusing on a “flexible approach” that would benefit both telecom and internet companies.
India isn’t alone in contemplating such changes. Similar discussions are happening in South Korea and Europe, making this a global dialogue that could redefine the relationship between telecom providers and internet companies.
As the debate intensifies, TRAI will play a crucial role in determining the future of the telecom and internet industries in India. With 5G and potentially 6G on the horizon, how this issue is resolved could set a precedent not just for India, but for the rest of the world.