Recently, several Indian companies left a zero rating arrangement called Internet.org citing a need to defend net neutrality. While a strange move, the firms’ decisions are telling of the popular net neutrality zeitgeist.
Internet.org is one example of a broader type of practice called “zero rating.” This term refers to many different kinds of partnerships between mobile broadband providers and content producers. In the case of Internet.org, Facebook is setting up agreements in developing countries in Africa, Asia, and South America where most people have never had any access to the Internet. In less developed countries, buying an allotment of mobile data is often the only way to get online. A zero rated plan means that users, can visit certain webpages without having the data counted against their allotment. Internet.org, for example, provides access to weather, health, and local news sites (as well as many others) and users can visit those sites without paying for the data used.
This sounds like a pretty good deal, but there is significant opposition to the practice of zero rating. Some governments, like Chile, have gone so far as to ban it altogether. The opposition comes from net neutrality fanatics. They accuse Internet.org, and other zero rating arrangements, of unjustly favoring the content covered by the agreement and, thereby, creating barriers to the rest of the Internet.
These objections border on irrationality. First of all, there is nothing about Internet.org that keeps users from visiting non-zero rated sites. They would simply have to pay for those sites like everyone else. If opponents are successful at eliminating zero-rating, consumers would have the same options that they would otherwise have but at a higher price. It is difficult to see how that position is pro-consumer. Furthermore, in the case of Internet.org, most users now have no Internet access and so would be left with nothing if zero rating deals were outlawed. So what opponents to zero rating are really saying is that they would rather people have no Internet at all than the selection provided by Internet.org.
Not only do arrangements like Internet.org not prevent consumers from visiting sites not within the free environment, the actors involved have an incentive to encourage leaving. Carriers only get paid if people click outside of the zero rated sites, and content providers will see an increase in demand as people who never had Internet access now demand content. Demanding some content from within the free offerings will inevitably lead to demand for other sites, not to mention the fact that many zero rated sites contain content which links to outside pages.
Many detractors have tried to nuance their objection by saying that they don’t mind what Internet.org is doing, they just oppose the framing of it as charity because, they claim, it is merely an attempt by Facebook to make more money. Although Internet.org is not exactly a cash cow for Facebook, there is a sense in which this point of view is exactly right. It is no coincidence that Facebook is one of the free sites in all of Internet.org’s packages. But that is no reason to oppose it. There is no reason to think that a shrewd business practice must be bad for consumers. Indeed, voluntary transactions are, by their very nature, mutually beneficial. Other businesses are constantly instituting sales and giveaways to enhance their profits, yet there is no outcry against department stores every holiday weekend. No one seems to be proposing that no one be permitted to buy a car unless they are all the same price.
The paper thin nature of arguments against zero rating reveals the fact that opponents are not making a high-minded defense of consumer welfare. Instead, they are merely chanting the dogmas of net neutrality orthodoxy and demanding that all others to do the same. It is telling that the withdrawals of the Indian firms from Internet.org simply said that they made the decision because they were “committed to net neutrality” or “standing up for net neutrality” without bothering to explain why net neutrality (or, at least, the zero rating subsection of it) is a good idea. If net neutrality means preventing willing actors from providing free Internet to some of the world’s poorest people, then maybe it is not worth defending. Under current conditions, zero rating deals like Internet.org are unquestionably a win-win, and net neutrality zealots aren’t just looking this gift horse in the mouth, they are giving it a root canal.
by Mauricio Fino is licensed under CC BY 2.0