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Jio, Airtel, Vodafone-Idea want tech firms to pay network costs

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Major telecom companies in India like Jio, Airtel and Vodafone-Idea have made a recommendation to the Telecom Regulatory Authority of India (TRAI) that internet companies should contribute to the costs of operating telecom networks, reigniting the debate on net neutrality in the country.

These recommendations came as a response to TRAI’s consultation paper.

Jio, India’s largest telecom operator with over 450 million subscribers and a 55% share of the nation’s total data traffic, contends that requiring internet companies to compensate for network usage will ensure fair competition, reported TechCrunch.

“We suggest that TRAI [India’s telecom regulator] should recommend for OTT providers contributing to the network development and building a backbone for the country. In this effort, the Other OTT service providers should also be required to pay their fair share,” said Reliance.

Airtel, another major player in the Indian telecom sector, supports this proposal and adds that only the largest internet users should bear network usage costs, allowing smaller startups to thrive unhindered.

However, these recommendations have ignited a contentious debate about net neutrality. Critics like Nikhil Pahwa argue that this move could undermine the principles of net neutrality, which seek to maintain an open and unrestricted internet environment. Pahwa, known for raising awareness about potential net neutrality violations in the past, warns against such a compromise.

Many tech companies, represented by the Asia Internet Coalition, assert that their services have contributed significantly to telecom operators’ revenues and that shifting network costs onto them could stifle innovation and potentially burden consumers. This group includes industry giants like Apple, Amazon, Microsoft, Google, Meta, Netflix, and Spotify.

Although India is the second-largest wireless market in the world, the average revenue per user is still poor.

In response to these concerns, the telecom companies in India claim that their recommendations do not violate net neutrality principles. They argue that the exponential growth in network traffic, especially with the rollout of 5G and eventual 6G technology, necessitates a collaborative framework where tech companies share the financial burden.

The relationship between telecom operators and tech giants is multifaceted in India, with the former serving as distributing partners for the latter. Companies like Netflix, Microsoft, Google and Meta have significantly invested in Indian telecom operators, especially Jio, further complicating the debate.

India, one of the world’s largest wireless markets, is still struggling with low average revenue per user of a mere $2 per month. Telecom operators paid $19 billion for 5G airwaves last year, hoping that TRAI would intervene to boost their margins.

While India grapples with the issue, similar pushes for internet companies to contribute to network costs are seen in South Korea and Europe. The outcome of this debate will have implications for the global digital landscape and the future of net neutrality.

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Kumar Hemant

Deputy Editor at Candid.Technology. Hemant writes at the intersection of tech and culture and has a keen interest in science, social issues and international relations. You can contact him here: [email protected]