It is a little over two years since the Indian communication regulator (TRAI) banned any kind of discriminatory or preferential pricing for internet services India. Credit for this ruling can be attributed to a very public campaign against Facebook’s implementation (and heavy advertising) of its Free Basics program. As of February 2016, TRAI ruled that no operator is permitted to offer zero-rated services of any kind. This shut down Free Basics and Airtel’s similar offering Airtel Zero in India, among others.
This ruling catapulted India into the forefront of network neutrality regulations globally with some claiming that India had implemented the world’s strongest net neutrality norms. There was an implicit assumption that a more level playing field for digital services would be engendered through this ruling.
Meanwhile in Sub-Saharan Africa, there was no such social pushback to zero-rating. Across the continent, mobile network operators (MNOs) offer Free Basics and a hundred variations on zero-rating, often (perhaps ironically) referred to as WTF, providing consumers with free or heavily-discounted access to WhatsApp, Twitter and/or Facebook.
Free Basics itself is now available in 33 African countries and in 65 countries around the world in total. But Free Basics is just the tip of the iceberg. Look at the website of almost any African MNO and you will see free or discounted packages for WTF. Here are a few examples.
Airtel in Kenya
MTN in Uganda
Telkom in South Africa
MTN in Cameroon
9Mobile in Nigeria
Airtel in Nigeria
Safaricom in Kenya
The practice of zero-rating or discounting social media is now so common that national tech publications publish guides to getting the cheapest social media bundle, like these ones in Nigeria, South Africa, and Zimbabwe.
But come back to India. Let’s look at what has happened to WhatsApp in the two years since the banning of zero-rating or any kind of discounting of specific apps. WhatsApp has gone from 200 million monthly active users (MAUs) to 400 million. Let that sink in for a minute. India is WhatsApp’s most important market. WhatsApp effectively has no competition in India. Its closest competitor is Facebook Messenger. There is an inescapable conclusion from this. Banning zero-rating did not have any appreciable impact. One could argue that things might have been even worse from a competition perspective as a result but it is hard to imagine.
If we accept the argument that WhatsApp becoming the default messaging app in India is a generally negative strategic outcome for the country, whether from the point of view of economics, privacy, or cybersecurity, then what might be done? A simple response would be to permit or even encourage/subsidise zero-rating of Indian apps and services.
Let’s face it. Messaging is not rocket science. Popular messaging apps have been around since the mid-nineties. Of course messaging apps are so much more these days (they are platforms) but they still fall within the realm of well-understood programming challenges. And indeed there are Indian rivals to WhatsApp. ShareChat is an example. I have no doubt there are others.
Why shouldn’t we zero-rate domestic apps? We do everything else to stimulate local digital startup growth from incubators to grants to soft loans to competitions to techno-parks. Zero-rating domestic apps would have the dual benefit of addressing affordability issues for the poorest users while promoting local digital apps and services. It may require more than a simple regulatory change to achieve this though. MNOs might require incentives in the form of tax incentives or similar mechanisms to offset costs they incur in zero-rating local apps and services. A small price to pay perhaps.
Back to Sub-Saharan Africa. There are African messaging solutions as well. In South Africa, mobile OS company Binu recently launched Moya, a messaging app with zero-rating built into its business model. In Mali, a local entrepreneur has created Lenali, a voice-based messaging app that takes into account the diversity of language and literacy levels in the country. African innovation is not limited to messaging of course. For example, there are domestic competitors to Uber in South Africa, Kenya, and Nigeria. And that is just the tip of a very large iceberg.
In India domestic zero-rating might be the right strategy but for Sub-Saharan Africa, it maybe that a regional or even continental approach would be even better. This might be a strategy embraced by regional economic bodies on the continent.
The growing dependence of African governments and businesses on a Silicon Valley company for something as as important but also as basic as messaging should be of concern to everyone. Whether you are worried about data sovereignty as domestic communication is exfiltrated beyond the jurisdiction of national governments or the growth of a local digital economy or even just about network fragility as an increasing percentage of the world becomes dependent on a single service provider, there are good reasons to consider making the use of local apps and services free.
Not to mention that growing competition in the messaging space might get us to what we really need, namely interoperability through an open API, but that’s a topic for another day. If we want to reverse digital colonialism, the domestic zero-rating of apps and services or LocalRating might be a good place to start.
Thanks to Peter Bloom for feedback that made this a better article. If you haven’t read his recent piece on 5G and the Digital Divide, I encourage you to do so.