Flipkart On Net Neutrality: The Situation That Exists In India Today Is Akin To Apartheid In The Internet World.

Flipkart cofounder Sachin Bansal shares his thoughts on net neutrality, zero rating : “We are only asking for equality with our global peers and are NOT asking for any preferential treatment.”
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[dropcap]A[/dropcap] lot has been talked about Flipkart’s support for net neutrality. Last week, Flipkart’s Cofounder and CEO Sachin Bansal shared his stand (w.r.t net neutrality) on twitter. The net neutrality supporters didn’t appreciate it and brought down Flipkart’s app ratings.
We bring to you an UnPluggd interview with Sachin Bansal where he talks about net neutrality, zero-rating model and why there is a need for a fair playing ground (for all).
NextBigWhat: What is Flipkart’s stand on net neutrality?
Sachin Bansal: We are in favour of Net Neutrality.
Any situation where users have complete control over the services they use or products that they buy is something that we support completely.Sachin Bansal
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.
For any Internet entrepreneur, the ideal situation would be when their products or services can be experienced by everyone in India. The fact that Internet penetration is on the rise in
India is a positive but it is offset by the costs associated with Internet access. 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; we believe that such offerings will only benefit them.
NextBigWhat: Is Flipkart participating in Airtel Zero? Isn’t that anti net neutrality? What’s your take?
Sachin Bansal: Let me clarify something at the outset. I can confirm that there are conversations happening with Airtel but we are yet to sign a deal. And as is true with any other deal there are many factors which will go into deciding whether it materialises or not.[pullquote-right] The situation that exists in India today is akin to apartheid in the Internet world.[/pullquote-right]
Our discussions have revolved around zero rating of Flipkart’s mobile app data – and that is the only thing we are looking at. We are certainly not asking for any special packs or regulating the speed of the connection; nor are we seeking preferential treatment or pricing. What we would like to do is to pay for parts of the data that our users consume while accessing the Flipkart app. We only support zero rating and nothing beyond that.
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. We have been assured that the pricing will be fully transparent and will be available to all.
If at any point in time TRAI decides this is not acceptable, then there is no question of doing this. Having said that, I hope the government takes a balanced approach to this. I believe this will make cheaper Internet accessible to more people. A concept like zero rating will help our marketplace customers and sellers benefit the most due the reduced burden on their pockets. This can also help many small sellers come online in larger numbers.
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. The situation that exists in India today is akin to apartheid in the Internet world. 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.
NextBigWhat: Zero rating is considered anti net neutrality and will hurt the ones who can’t pay to be in a platform like airtel-zero. Thoughts?
Sachin Bansal: 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 organisation wishes to encourage Internet users to fully experience the product or service at no extra cost, zero rating makes sense.
There are many conflicting market forces at play which gives us confidence that zero rating does not pose a fundamental threat to net neutrality. The main three forces/realities that I would like to point to:
1. Zero rating is something that can’t scale to impact all user data and the whole of the Internet; if that happens then telcos business model will shift from being a B2C business to a B2B one, which no telco would like to see.
2. 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 and therefore this cannot be sustained meaningfully for long periods of time.
3. Consumers are smart and aware of what they want. Anything that restricts choice will never survive in the long-term.
The laws in India today don’t see zero rating as something that impedes competition. Even if Flipkart doesn’t participate in Airtel Zero, it does not really change anything. Global companies will continue to do zero rating. The only way to completely do away with zero rating will be to change the regulations and make it equal for all players. [highlight]Not have separate yardsticks for local Internet companies and global ones[/highlight].
NextBigWhat: If you have to start again, would you change your stance w.r.t being on airtel zero?
Sachin Bansal: Let me reiterate that the deal with Airtel is still under discussion. We are still discussing the various features of the platform and evaluating how it will benefit our customers and sellers.
Throughout our journey in ecommerce we have advocated choice and have created ways through which our customers experience innovation in online shopping. While we do wish to find ways to differentiate Flipkart from others, we have been able to reach here only because Internet is neutral.
Some folks on the social media are advocating uninstalling the Flipkart app. This definitely hurts. What people don’t realize is that, even if this is successful in stopping us from doing the deal, this doesn’t actually change anything. Like I said before, if people really feel this strongly zero rating should not exist then the laws need to change. We are one hundred percent committed to comply with all laws and rules.
Till then, if by paying for parts of the cost of data usage, we can help more users access the app and contribute towards a more enhanced shopping experience then we will continue to explore similar ideas. This is no different from any other marketing efforts we are making for driving adoption of the Flipkart app for customers and sellers.

12 comments
  1. Man, this is so full of excuses!! Bansal thinks zero rating is fine because:
    1. It can’t scale to all users.
    – so, does the fact that it does not scale to all users make it fine?
    2. Per MB cost borne by internet companies on zero data plans is more so it will not sustain.
    – what? As long as you guys can make money from it, it will totally sustain!
    3. Anything that curtails choice will not survive in the long term.
    – Please do your bit and stick to what you think is right. Don’t use excuses like this.

  2. “we can help more users access the app and contribute towards a more enhanced shopping experience then we will continue to explore similar ideas. ”
    What he basically meant there – WE WILL DO ANYTHING TO STOP CUSTOMERS FROM SHOPPING ANYWHERE ELSE AND WILL TRY OUR BEST TO CREATE A MONOPOLY.

  3. I don’t buy the “won’t affect other regular access at all”. Simpler way : work deals with operators to reverse metering on ALL traffic to FK for all users. No separate plan/pack.

  4. Mr Bansal, you must concentrate on generating some cash flows, as your business is just running on PE money and not a single rupee profit has been generated…what will you do if all sellers decide to start their own online presence and then internet truly becomes net neutral….when someone becomes success due to chance and luck, you need to be humble in what you say…..

  5. ecommerce is nearing its bubble, and sellers are wanting to go offline and sell at their convenience….watch out, Flipkart….you and likes will be history soon…

  6. NO, currently the internet situation is not apartheid. Airtel-Zero/Internet.org will make it like apartheid. If Airtel-Zero/Internet.org exist, the Paid Internet will become the thing no one wants to touch.

  7. It not just about not doing bandwidth throttling . One needs to look at the larger picture. Says TOI goes free since have deep pockets, than what about lesser popular national / regional dailies . they will go out of biz overnight.

  8. Fundamental point is Internet should be free of discrimination. We have/had enough discrimination in real world, please don’t get it into virtual world.
    Regarding sustainability only time will tell, if the model is sustainable. Until we have enough data to substantiate the claim. But what I feel is it may not be sustainable for companies like flipkart, since they rely on sale of products, but may very well be sustainable for companies who’s revenue comes from ads, like facebook.
    Finally just because someone(Internet.org) is doing something wrong, doesn’t justify me doing wrong too. We should be equivocal in resisting both these initiatives.

  9. Whoever is doing PR for FK needs to be fired.
    There’s only one thing they can do to not look more stupid. Doing nothing. No interview, no impossible justification. No nothing.

  10. “zero rating should not exist then the laws need to change. We are one hundred percent committed to comply with all laws and rules.” – is a lame excuse by Sachin Bansal. in 18th century, there was a well established law of trading slaves it was as normal as someone trading cotton. Nobody thought it to be wrong; Until few looked within and listened to their conscience, asking is it right thing to do so?
    Looks like Sachin Bansal is wearing a cool shades with big $$ sign and everywhere he looks he sees money.

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