India is seen as a major growth market for internet companies, and Facebook tried to tap this with its 'noble' Free Basics plan. But Indians were not impressed and compared it to colonialism.
India says no to Facebook founder Mark Zuckerberg’s Free Basics initiative
Preeti Kaushal, 16, who lives in the outskirts of Mumbai, longs to have access to the internet. Her mother is a housemaid and her father does casual labour, and they barely earn enough money to get by, so she fears that this may still be a distant dream.
“I would need enough money to buy a smartphone and pay to recharge it,” she says. “I can’t afford it.”
The consensus is that India needs to bring more of its population online, as its economy continues to develop.
This issues has come into sharp focus because Facebook was attempting to get more Indians from poor backgrounds online through the launch of Free Basics plan in India. This would allow users access to certain websites, including its own social network and Wikipedia, for free, but it turned out to be highly controversial. Facebook’s efforts to push its way into the poorer segment of the market – to strategically position itself to tap a market that is set to become increasingly lucrative – were this month thwarted by the Telecom Regulatory Authority of India (Trai), which ruled that such services which offer access to certain websites without any charge were illegal. Facebook tied up with Reliance Communications in India last year to introduce the plan, which was blocked in December as authorities investigated whether it was fair. Mark Zuckerberg, the head of Facebook, said that India was key to getting “the next billion” online when he visited the country in October.
One of the main arguments against the plan is that it compromises net neutrality, which is the principle that service providers should not charge differing rates depending on the user and the website, but that fees should be the same. This was cited by Trai as reason behind its ban. There were also protests in India against Free Basics and some argued that such a plan was comparable to colonialism.
India is seen as a major growth market for internet companies, with its population of more than 1.2 billion, the rising numbers of Indians moving online and increasing incomes in the country.
“Nowhere else has the programme been as controversial as in India, where it has ignited several debates over whether it unfairly favours some services over competitors,” says Zafar Rais, the chief executive of MindShift Interactive.
“A storm was created through petitions. Free Basics allows users to browse select sites and apps without paying for mobile data consumption. This data access is subsidised by a few telecoms operators who joined hands with Facebook with the hope towards giving users a taste of internet access and moving them on to packages at a later date, in all probability.”
The number of internet users in India has been rapidly gathering pace. It is estimated to have reached 402 million at the end of 2015, meaning that India has surpassed the United States to have the second-largest number of internet users in the world, with only China ahead, at more than 600 million users, according to a report released last month by the Internet and Mobile Association of India and IMRB International.
That represents a growth of 49 per cent over last year for India. But there are still hundreds of millions of Indians who do not have access to the Internet at all. Another 100 million users are expected to come online in India this year, says Ajay Kumar, the additional secretary of the government of India’s department of electronics and information technology.
“Last year we sold 100 million smartphones [in India], which was compared to previous year’s 80 million and 45 million in the previous year [before that],” he says. This is partly being driven by the availability of cheaper and cheaper smartphones in India as manufacturers develop products that are affordable to the large number of Indians.
Free Basics is present in about 40 countries, where telecoms companies pay for the data charges to give users access.
One critic who feels strongly about the issue is Shravan Charya, the president and chief executive of Lets Corp, a career platform, based in Singapore and with a presence in India. He wrote an open letter to Mr Zuckerberg, questioning the motives of Free Basics.
“Seeing an American for-profit corporation feel so passionately about the poor in India is indeed hilarious,” says Mr Charya. “There is nothing free or philanthropic about Free Basics, purportedly aimed at transforming the rural landscape of India. It is aimed at increasing its own share prices on Wall Street and add more monetisable advert revenue.
He says that India does need to find ways to bring the internet to more of its citizens but argues that Free Basics is not the right method to achieve this.
“Trai has done a commendable job by clamping a ban on it, followed by seeking curated responses from all stakeholders to design a policy based response. Facebook in return made a mockery of its own reputation by responding with a campaign spending millions of dollars.”
India’s prime minister Narendra Modi under his Digital India campaign wants to give more people in India, particularly in rural areas where connectivity is limited, access to the internet.
Corporate internet companies are well aware of the importance of the Indian market and are also trying to increase the number of users in the country.
Google’s chief executive, Sundar Pichai, on his first official visit to India in December highlighted plans to get more Indians online.
It has partnered with the Indian government to launch free Wi-Fi at railway stations, with the aim of bringing connectivity to 100 stations this year.
It also has its eye on pushing its Loon project into India, which involves floating balloons over remote rural areas of the country to provide internet connectivity.
“There are fundamental questions around how to ensure a truly inclusive, open internet for everyone,” Mr Pichai said, speaking in New Delhi during his visit.
Mr Rais explains that Facebook certainly had commercial motives in mind when it proposed Free Basics in India.
“If the intention towards providing Internet access to a wider audience was the objective, Facebook could have provided the same to all without preferences to select operators,” says Mr Rais.
Mr Zuckerberg responded to the ban by India in a statement on his Facebook page, expressing his disappointment.
“Everyone in the world should have access to the internet,” he wrote. “Connecting India is an important goal we won’t give up on, because more than a billion people in India don’t have access to the internet. We know that connecting them can help lift people out of poverty, create millions of jobs and spread education opportunities. We are committed to keep working to break down barriers to connectivity in India and around the world.”
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