[kictanet] Zero Rating in the African Context - was 'Telkom Kenya cries foul over social media’s free ride on its

Thu Oct 6 18:57:09 EAT 2016

@Mwende, Ali et al,
If up to some academic reading with policy implications, here is some research data on this Zero rating (free ride)  issue. Research covered  the case for Nigeria, Ghana, Kenya & SA.
>>>> A fresh, public-interested assessment of the zero-rating of certain applications (apps) and platforms in the African mobile prepaid environment is overdue. This policy paper examines the issue of zero-rating within the contexts of the range of discounted and dynamically-priced African mobile network operator (MNO) products, and the priority public policy issues facing the continent in relation to the Internet. The research is based on a four country assessment-Ghana, Kenya, Nigeria and South Africa.
>>>
More @ Research ICT Africa

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Research ICT Africa
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orhttp://researchictafrica.net/home.php?h=190
walu.
      From: Mwende Njiraini via kictanet <kictanet at lists.kictanet.or.ke>
 To: jwalu at yahoo.com 
Cc: Mwende Njiraini <mwende.njiraini at gmail.com>
 Sent: Wednesday, September 14, 2016 10:32 AM
 Subject: Re: [kictanet] Telkom Kenya cries foul over social media’s free ride on its - Corporate News

Good morning

The network neutrality debate has landed on the shores of Africa.

Here is an excerpt of an academic paper i had written some time back.

The netneutrality debate can be viewed as the next battle between the netheads and thebellheads; providers of broadband access on one side and Internet content andapplication providers on the other side. Frieden (cited Orlowski 2006) statesthat the Bellheads are investing heavily in fiber capability which will solve aproblem that the “Netheads” have proved themselves unable or unwilling totackle, that of high quality video over IP. Given that US governmentis keen to facilitate the rollout of universal and affordable broadband[1].  It can be argued that the aggressive fiberrollouts could suffer if network operator shares continue to lose value makingit difficult to blame the companies if they did slow down roll out. The companies,after all, have a duty to shareholders to pursue maximum profits notnecessarily to fulfill the goals of Internet advocates (Drucker, 2006).   However one has to be careful in analysingthe market as forces in telecommunications can be misleading. Telephonecompanies, for example, get billions of dollars in federal and state subsidiesfor rural service.   Access charges aredesigned to compensate network providers for the use of their facilities andthe compensation scheme is in part funds universal service.  Additionally, these companies may be claimingmore in the depreciation and the value of their assets.   Regulators maytherefore seek to eliminate access charges by allowing rates to rise to cover networkcost if not service providers should pay access charges.  This is however difficult to implementpolitically on the basis of public interest. Additionally, it is equally difficult to expect new entrants to payaccess since the avoidance of access is, at least in part, the source of theirperceived competitive advantage.   Historically,the FCC has not regulated the Internet or the services provided over it. Howeverfollowing the 9/11 terror attacks in the US, security is a key governmentpriority.  Consequently, open access tothe Internet articulated in the FCC “Four Network Freedoms”, is subject tolegality of content and needs of law enforcement (Frieden, 2006)    The FCCis thus constantly reviewing mechanisms[2] toimplement important social objectives, such as public safety, law enforcementaccess, consumer protection and disability access, as communications migrate toInternet-enabled services. On Wednesday, 28thJune 2006 the Senate commerce panel voted against amending the telecommunicationsbill by attaching the net neutrality provisions that would prevent operators fromblocking, degrading or prioritising service on their networks (Orlowski, 2006).  The defeat of the amendment could herald thereturn of the vertically integrated incumbent firm providing services along thewhole value chain.  Despite the fact that the access network has beenconsidered a natural monopoly area as a single firm could presumably constructand provide local services at a lower average cost than two or more firms(Spulber, 2002)[3], SirTim Berners-Lee, the creator of the web, views the defeat of the net neutralitylegislation as the entering a “dark period” for the Internet, if access supplierswere allowed to choose which traffic to prioritise (BBC, 2006).   The higher costsof a “tiered Internet” levied content providers will simply be passed on toconsumers, directly or indirectly. As there is no “free ride” on the network,and consumers will bear the costs of network development through higher accesscharges and higher prices for online goods and services[4].Moreover, a “tiered Internet” will further concentrate the market power of thecable modem and DSL duopoly, eliminating competition in the conduits andleaving consumers with no escape from content discrimination. The potential return of the two tiered Internet mayfurther widen the digital divide between developed and developing countries.  It may be argued that successful internetorganizations should contribute to the cost of internet infrastructure eitherthrough Internet settlement agreements or contribution to universal accessfunds.  This argument is based on the factthat these companies are providing functional equivalent services, thus thereis a need for operators to maintain network integrity and for governments toguarantee national security, and I concur.
[1] FCCdefines "high speed" as 200 kilobits in at least one direction.[2] OnFebruary 12, 2004, the FCC ruled that an entirely Internet-based VoIP servicewould be an unregulated information service in USA.  However the FCC released an order requiringVoIP providers to deliver enhanced 911 emergency services to itscustomers.   Source: http://www.fcc.gov/cgb/consumerfacts/emergencies.html[3] Thistheory is based on the assumption that firms will seek to leverage on economiesof scale to achieve production efficiencies, pricing services above cost andnot precluding competition[4] Scott(2006) predicts that companies like Google and Yahoo that support their freeservices through advertising revenue will raise their advertising rates,resulting in higher consumer prices on all the goods that advertise on these sites.  While Amazon and eBay will raise their ratesto account for the extra charges and I-Tunes and other pay-per-download contentsites will charge higher rates as well, to cover access charges by AT&T andVerizon. 
Disclaimer: Views expressed except those referenced are the author's own.  The full paper is available on request.

On Wed, Sep 14, 2016 at 7:16 AM, Ali Hussein via kictanet <kictanet at lists.kictanet.or.ke> wrote:

Listers
This is getting abit tiring..Telcos complaining social media platforms are getting a free ride on their infrastructure.
http://www. businessdailyafrica.com/ Corporate-News/Telkom-Kenya- cries-foul-over-social-media/ 539550-3379938-9liqm4/
What are your thoughts? Should Telcos charge companies like Google and Facebook for access to their networks? 
What would be next? A small fee for every website? 
#NetNeutrality

Ali HusseinPrincipalHussein & Associates+254 0713 601113 
Twitter: @AliHKassimSkype: abu-jomoLinkedIn: http://ke.linkedin. com/in/alihkassim

"Discovery consists in seeing what everyone else has seen and thinking what no one else has thought".  ~ Albert Szent-Györgyi
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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.

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