Zero rating--the practice of offering consumers access to some Internet apps without requiring a data plan or deducting usage from a data plan--is viewed by some as a violation of network neutrality principles.
The fear is that zero rating creates more Internet service provider gatekeeper power and could therefore reduce innovation.
Others might simply see it as a useful way to provide value to consumers who haven’t begun using the Internet because they haven’t been able to sample it.
The analogy often made is that zero rating is like toll-free calling: some businesses or organizations pay for calls on behalf of customers and prospects.
But the program is expected to be popular, and experience elsewhere suggests Bharti Airtel will find that the program encourages non-users to try mobile Internet apps, and will drive faster mobile Internet adoption.
That clearly was the experience in the Philippines, where Globe Telecom launched a program offering “no data plan required” access to Facebook.
Over the course of the first phase, the number of data users on Globe’s network doubled, and the portion of Globe’s prepaid subscriber base who were active on mobile data expanded from 14 percent in September 2013 to 25 percent in November 2014, Facebook and Globe say.
Globe’s Free Facebook campaign (and similar internet outreach efforts by other players in the market), led to a six million increase in the number of active mobile internet users in the Philippines.
During the first phase of the trial, Globe’s user base increased by 17 percent. Along with continuing to use data, these users also shifted core telco spend over to Globe’s network, growing voice and text messaging revenues by five percent.
By the end of the first campaign, prepaid mobile data users grew from 4.8 million to 9.7 million, more than a twofold increase.
Whether zero rating is bad or good for innovation is debatable. Zero rating does increase use of the Internet. And for some, that is the point.
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