Flipkart pulls out of Airtel’s net neutrality violating Airtel Zero
Startup entrepreneurs erupted in joy after the India’s biggest e-commerce platform Flipkart retreated from a programme that critics thought could result in an unequal Internet and killed competition.
The analysts said that “By turning its back on Airtel, the India’s largest mobile phone company, Flipkart is responding to fight from within and out after severe criticism for its intention to use its financial muscle to subsidies users of its application.”
This Tuesday Flipkart said it is “walking away” from talks with Airtel, and even took a dig at the Airtel by saying that the ‘Airtel Zero’ subsidization platform violates its core “principles”. For Flipkart, which is battling Snapdeal and Amazon in a fiercely competitive e-commerce market, yesterday’s reversal of their decision is the second time in the recent past Flipkart has been forced to eat humble pie — in October,2014 the company was forced to apologies to its consumers after botching what was billed as its biggest sale ever.
“It is absolutely a welcome decision taken by Flipkart,” said K Ganesh, a serial entrepreneur.
“Startups will be relieved … they have one less variable to deal with,” said K Ganesh a serial entrepreneur, who sold one of his startup companies TutorVista to Pearson for about Rs 1,000 crore nearly 3 years ago and now backs BigBasket., a online grocery retailer Internet users in India sent an unprecedented over 3 lakh emails over the last 3days to the Trai, asking it to save net neutrality.
Net Neutrality movement, which began in response to a recent Trai consultation paper, increased importance with the potential alliance between the Airtel and Flipkart. Flipkart and Airtel faced flak on social media and even the telecom minister supported net neutrality on Monday. The founder of online news portal Medianama, Mr. Nikhil Pahwa, who is one of the prime force behind the campaign for net neutrality, described the Flipkart retreat as a “first step” towards the goal of a free and equal Internet in India
“We need a net neutrality law quickly so that no other company will try this again.” The co-founder of Myntra, Mukesh Bansal, who is also the CEO of commerce at Flipkart, told ET that they had second thoughts after “deeper analysis” of their deal it was planning with Airtel showed that it may not be able exercise control the way it had anticipated. “And the moment we realized that, it was a no brainer for us to drop the plan,” he said. Reacting to this announcement made by Flipkart, Airtel said, ” Flipkart’s statement regarding its decision of not to offer toll-free data service to their customers is consistent with our stand that Airtel Zero is not a tariff proposition. It is merely an open platform for content providers to provide toll-free data services. The platform will be open to all companies who are wanting to offer these toll-free data services to their customers on a completely open basis.”
The practice of allowing free data with no charges for the use of apps by the consumer by striking a deal with the telecom operator is called zero rating. It is widely perceived as a violation of the principle of net neutrality, where all data is treated equally regardless of its origin.