Loopholes threaten to undermine net neutrality

NEW DELHI: The Telecom Regulatory Authority of India’s ( Trai) order to maintain price equality on content faces the danger of being breached as some telecom companies are understood to be working on a “bypass solution” through virtual private networks or intranet.

The idea is simple: Since the Trai order does not apply to traffic that does not flow over the internet, move your collection of content over private servers and make it available to your customers through virtual private networks or closed user groups. This would qualify as data that flows over “closed electronic communications networks” (CECN), and thus will not fall under the purview of the Trai’s order.

The result could, however, be catastrophic as far as the tenets of net neutrality are concerned. The intranet could become a second internet, separate from the open internet, and the one controlled and driven by telecom companies.

“This bypass has the potential to create price differential as those with access to private networks will get subsidised content. This will distort competition and be discriminatory against those who are not present on the network,” a senior industry official said, requesting anonymity.


Apar Gupta, a lawyer who works on net neutrality matters, said Trai’s exception in its order for intranet is meant only for proprietary content. “This is not to be used for content such as movies or sports or other content found on the internet. Trai has given an exception supposedly only for enterprise or managed services, and mainly for business-to-business services rather than business-toconsumer.”

An industry official said companies looking for a bypass to the Trai rule may create “walled gardens”. “First you put lucrative content on your server, making it available to your subscribers at highly-subsidised prices to the market. And then, you regularly upload/refresh this content, virtually creating a dynamic online content setup. This virtually means that though a customer is not connected to the internet, his/her content is getting refreshed on a real-time basis as the company’s server gets refreshed.”

Sanjay Kapoor, former CEO of Bharti Airtel, however, said that bypass methods may not work for companies in long run. “Nowhere in the world we have seen that a walled garden approach works, except for China. The consumer is very smart today. Also, a large amount of content is user-generated which cannot be wall gardened.”


A senior-level official at Trai said the intranet exception could prove to be dangerous precedent if companies use it as a bypass to the differential tariff order. “Even though there is a provision for Trai to check the misuse of the exception, this may actually not be sufficient as the process may be time consuming and will allow the company to attract subscribers. Legal challenges will make the process of correction slow,” the official said, requesting anonymity as he is not authorized to speak to the media.


The soon-to-be-launched Reliance Jio Infocomm has been working on a large library of content that includes movies, music, news and television. The company will launch these under various apps such as Jio Play ( TV service), Jio on-demand (movies), Jio News (library of newspapers) and Jio Mag (collection of magazines). Those in the know of the operations, however, said these would be provided as open apps which would be available for both android and iOS users of “any mobile operator”. The only differentiating factor will be the data price that the company will charge and “there is no intention of creating any walled garden,” a source said.