Mark Goldberg

Removing choice for low income

The Times of India reports that the Telecom Regulatory Authority of India, TRAI, is expected to issue an order this week that will prohibit differential pricing for data services, a move that will impact Facebook’s Internet.Org Free Basics service and Airtel’s Zero service.

I have written extensively on these issues over the years:

There are other postings as well.

As I wrote in 2011, “It is difficult to understand how consumers can benefit from restrictions in the types of offers available to them.”

I continue to have difficulties with the idea that consumers are somehow better off with fewer choices in the marketplace. Banning zero rating provides no benefits to anyone. Prices go up for some users and go down for no one. Consumers have less choice, not more.

More than 8 years ago, in a piece called “Leading a horse to water“, I asked “Are there some applications that might lend themselves to a toll-free model in order to reach the rest of the market?”

For example, would home health care warrant installing a broadband connection as part of a monitoring service? The broadband access would be enabling underlying service, but the costs would be incurred by the health care agency, not the infirmed. Like toll-free calling, the application provider would pay the charges.

We need creative, market approaches to increase the levels of adoption of digital connectivity among low income households. Limiting choice, such as removing services like Free Basics, looks like a step in the wrong direction.

1 comment to Removing choice for low income

  • I probably will tend to agree, it’s just an issue of “Is it monopolistic or not?”. I don’t see how is any different from the old “AOL vs the Internet” from a few years back. As long as India’s telecom industry is progressing and not acting monopolistically by unfairly promoting while imparing the development of other services (aka the internet), they should butt out and leave them alone.