How Net Neutrality Affects the OTT Players in India

Net neutrality means equal treatment to all sets of Internet users across every region without differentiating their ISPs, mode of access, time of access or content consumed on various websites, apps or internet services.

Previously, cable television services had a similar business model, wherein a user could access any channel without additional fee or charges. Access was not denied to any of the channels; premium or local and flat fees were paid monthly. However, this model has since evolved, and now certain premium channels/content partners do charge an additional fee.

The Internet, in our opinion is one of the greatest inventions of the last century benefitting people across the globe. It has not only given us connectivity with people long lost or halfway across the world, but it has also furnished us with a whole new world of content.

In India, the very notion of booking a railway ticket sitting at home was a distant dream earlier but today, Internet has made that & several such notions possible – ranging from paying your cellphone bills to shopping for furniture, it can all be done online today.

So, what has made all these changes possible? Freedom of access has created the need and hence a market for new products, services & content. The only heroes in this market are the quality of offerings and customer service making it a level field for all the players in the market.

The core issue of net neutrality was raised in India when a leading telecom operator partnered with an Ecommerce player and levied no charge to users for visiting/utilizing the ecommerce player’s assets.

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This deal would affect netizens, stand-alone web developers and portal owners who felt that such deals no longer allow for retention in the balance needed for a level playing field.

While it would give free access to users, this deal would inevitably slow the growth of new ideas, other similar startups would continue to suffer losses and would not be able to pay for their user’s data consumption.

The customer would benefit from the immediate cost saving, however, this would still not be implementable for categories as a whole, and the focus on the core business would be lost.

From a telecom operator’s point of view, they are investing capital to build up the infrastructure to support the data industry – no less than what an ISP (Internet Service Provider) is presently doing. While the telecom operators have paid a large sum of money to acquire telecom licenses, VoIP apps (Voice over Internet Protocol) have only developed due to freedom of internet without paying any amount to obtain a license, and continue allowing users to call on normal data rates, which becomes detrimental to the core business of the telecom operators to generate revenue from the mobile telephony market.

Almost all the big names on the Internet/OTT space existing today were born because of the freedom of the Internet and other new channels.

While such tie – ups would greatly benefits the few established online product/service providers who have achieved economies of scale to drive consumption by partnering with telecom providers, this would lead to a monopoly of the marketplace by such few players.

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For the Internet and Internet driven products to grow and to scale up, it is imperative that OTT’s provide a unique product offering to users, backed by a robust delivery & execution model.

This is only possible if the focus of all OTT players remains what it should always be – value generation for the end user.

Disclaimer: This is a guest post. The statements, opinions and data contained in these publications are solely those of the individual authors and contributors and not of iamWire and the editor(s).

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