Zero rating poses a conundrum for net neutrality advocates around the world

The trade-offs globally for affordable internet access are tricky. "Zero rating" provides free data for some sites and services, but not all.



In November 2014, the political landscape fundamentally shifted when President Barack Obama made a public statement in favor of strong net neutrality rules. The president urged the Federal Communications Commission (FCC) to reclassify consumer broadband internet service providers (ISPs) as common carriers, instead of information services. That means the FCC could gain authority to prevent ISPs from creating fast lanes for preferred partners or slow lanes for competitors.

Republicans in Congress subsequently advanced their own legislative proposal into the debate on net neutrality, proposing rules for governing how ISPs handle online traffic that go beyond those advanced by the FCC in 2010, outlining principles that would mandate no throttling, blocking, or paid prioritization. This proposal, aimed at preventing ISPs from being regulated like utilities, has been criticized by advocates as "net neutrality in name only," given provisions that would strip the FCC of some legal authority, including that which would enable the agency to assist cities that wish to create municipal broadband services.

Global principles: No blocking, throttling, or paid prioritization

Whether the president's approach is ultimately the one the FCC chairman Tom Wheeler proposes in a rulemaking this year (an outcome that looked increasingly likely in January 2015) or Congress sends the White House a bill to consider, other countries have pursued their own versions of net neutrality. Chile was the first country to enact a net neutrality law, in 2010, followed by the Netherlands in 2011 and Mexico in 2014.

Doing any "apples-to-apples" comparison is challenging, as Danielle Kehl, a policy analyst at the New America Foundation's Open Technology Institute, explained in an interview.

"Especially for net neutrality, there are global principles for managing a network but it's divided up by national legislation," she said. "There's two examples of recent progress. In Brazil, they passed the Marco Civil da Internet, or an 'Internet bill of rights.' There had been fighting for a long time about keeping net neutrality in the bill. The telcos fought to keep it out, but the language kept in is pretty good. The European Parliament voted for new net neutrality rules last year as well."

An amendment in the strong net neutrality laws adopted in the European Parliament offers perhaps the clearest articulation enacted in law, of the relevant principle:

"Net neutrality" means...all internet traffic is treated equally, without discrimination, restriction or interference, independently of its sender, recipient, type, content, device, service or application."

That's straightforward. The proposed rules laid out by President Obama are also clear, with respect to how ISPs are expected to treat users: no blocking, no throttling, increased transparency, no paid prioritization, and inclusion of mobile broadband.

Dealing with network congestion

The challenge is in how these principles are applied to actually managing networks and how governments should regulate them, and at what level of the network.

Network congestion occurs and when it does traffic will need to be prioritized and managed at times, from first responders in emergencies to telemedicine, or in places, like football stadiums or concert halls. Many telecom analysts, lawyers, and advocates agree ISPs should be transparent about what they're doing with traffic or data speeds. What's harder is judging why, or when, and if they made their "best effort" at delivery.

"Wireless carriers, particularly, face unpredictable network demands and manage traffic aggressively," said Brent Skorup, a research fellow at the Mercatus Center at George Mason University. "At times of congestion, the network operator can drop packets randomly" -- representing so-called "best efforts" -- or "intelligently," meaning "from applications that can best tolerate it. Most net neutrality laws mandate no discrimination between online applications or sources of content, effectively mandating best efforts."

When consumers have multiple options for broadband internet services, wired or wireless, and are not locked into specific devices, they can choose to shift providers. Where markets for broadband internet have failed, however, strong net neutrality rules that prevent incumbents with monopoly or duopoly control become much more important.

Is the internet exceptional?

A core issue in policy debates over the best approach to regulating online traffic is whether lawmakers and regulators should view the internet as exceptional or as just another telecommunications service.

"In my view, the internet is exceptional because it operates on a largely voluntary basis," said Eli Dourado, director of the Technology Policy Program at the Mercatus Center.

"Net neutrality proposals implicitly or explicitly undermine the voluntary, exceptional internet -- they impose rules on interconnection or on traffic management that make it more like traditional telecom."

Proponents of net neutrality, including President Obama, are advocating that the regulators treats ISPs like traditional telecoms but use forbearance to preserve flexibility.

Globally, however, the net neutrality debate that's lighting up the internet today may become a moot point outside of wealthy countries. In the rest of the world, the principle of net neutrality is being weighed against getting the next billion people online over wireless services through "zero rating," or giving mobile network customers a specified amount of data usage for no extra charge.

As Wired has reported, in countries like Zambia where free wireless internet is provided only to a limited number of core services, network neutrality doesn't exist: it's already gone.

Tricky trade-offs globally for affordable access

"The zero rating question, here in the USA, is not central" to the net neutrality debate, "but it's a huge issue elsewhere," said the Open Technology Institute's Kehl. "The question of whether or how it fits into network neutrality is one people will struggle with, weighing affordable access through low cost, low bandwidth services, versus whether that prioritization is the unfair, walled garden scenario we're trying to avoid."

This faceoff between human rights and network neutrality principles is emerging in dozens of countries, where limited access to some services through free data is balanced against complete access for only those that can afford to pay.

Advocates on both sides of the issues are squaring off, with no clear resolution ahead. Susan Crawford, a law professor, author, and former White House advisor on telecommunications policy, argued in Backchannel in January 2015 that zero rating is "absolutely inappropriate," and that to allow it presents a human rights issue.

"[Zero rating] makes certain kinds of traffic exempt from any data cap at all, or creates a synthetic 'online' experience for users that isn't the Internet. Traffic that is 'approved' is allowed; other traffic won't flow to users. That's discrimination on the basis of the nature of the traffic itself, being carried out by the service provider -- not by the user.

The pragmatists, and the carriers, say that it is worth allowing poorer populations around the world (now barred by the high cost of Internet access) to see part of the Internet. But the cost of such services is the future of the Internet. Those users may never move to 'real' Internet access, satisfied with their 'free' access to a walled garden of chosen services. And carriers will have no particular incentive to provide them with that open Internet access. Instead, vertical discrimination will become the norm: the Internet as cable TV."

Skorup, however, says that it's not an exaggeration to say that zero-rated apps can be lifesaving in poorer nations.

"Since poorer nations have huge demands for Internet access but often terrible telecom infrastructure, I don't see zero-rated apps and mobile walled gardens going away anytime soon," he said. "Net neutrality proponents will talk about how these business models violate human dignity in some intangible way, but they can't argue with the popularity and obvious social benefits of walled gardens. In fact, since wireless is constrained even in rich countries, I think we'll see increasing use of zero-rated applications here, though mostly as a way to differentiate your service from a competitor's."

What this likely is leading much of humanity towards is the further emergence of haves and have-nots, where inequality is entrenched in differential access to services based upon data. To put it another way, instead of a purely digital divide, there will be a data divide.

Unless governments move to provide free broadband access themselves, this dynamic is likely to scale. A way to address the issue may be for governments, corporations, and foundations to subsidize full access to the internet through free data for the poor. Such an approach has precedent, like the FCC's E-Rate program to improve Net and telecom services for schools and libraries.

In the absence of subsidized data that provides equal access to the entirety of the internet, what seems likely to emerge around the globe is not network neutrality, but network inequality.

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