Net Neutrality, Zero-Rating and Development: What is the Data?
03 September 2014 - A Workshop on in Istanbul,Turkey
This is the output of the real-time captioning taken during the IGF 2014 Istanbul, Turkey, meetings. Although it is largely accurate, in some cases it may be incomplete or inaccurate due to inaudible passages or transcription errors. It is posted as an aid to understanding the proceedings at the session, but should not be treated as an authoritative record.
>> EMMA LLANSO: Good morning everyone, thank you so much for being here so bright and early at 9 a.m.
Sorry we're starting late. We are still waiting for one panelist, but he should be able to hop on stage whenever he gets here so we'll get started. Is the mic picking up my voice? It's a bit hard to hear.
So my name is Emma Llanso. I'm the director of the Free Expression Project at the Centre for Democracy and Technology. I'll be your moderator this morning.
Just to provide a bit of background for our panel, zero‑rating refers to a range of technical and businesses practices that aim to offer free data services for customers of mobile Internet access providers as they access certain popular online services.
Major online content and service providers, including Facebook, Google, Twitter and Wikipedia are experimenting with partnerships with mobile network operators in a variety of countries to deliver what are often lightweight versions of their services at no cost to subscribers.
Mobile users on participating networks access these zero-rated services without paying for data usage. In some cases, this means use of the sites doesn't cost against customer's data caps, while in other arrangements, mobile users can access the service even if they don't subscribe to a data plan.
For example, in the Twitter access programme, a mobile carrier gives subscribers no data access to mobile.twitter.com for a promotional period. Downloading media or clicking links prompts warning that the mobile user will incur data charges.
Similarly, Facebook‑zero, which launched in May 2010, provides a lightweight, text-only version of Facebook available through participating mobile networks at zero.Facebook.com. This summer, Facebook's Internet.org Project announced a partnership in Zambia with a telecom operator Bharti Airtel, which will allow subscribers in Zambia to use the Internet.org app to access the only Facebook and Facebook messenger, but also Wikipedia, Google search, several local job search portholes, information about health and the weather and Zambian law and a women's rights app.
While many of these services are primarily targeted at developing economies, they are also available in some European countries and in the United States. Mobile carriers, including AT&T and T‑Mobile offer subscribers mobile Internet plans with data caps along with sponsor data deals for particular apps so usage of the apps doesn't count against the data cap.
One of the main arguments in favor of zero-rated services is they are a method of bring down the cost of access to information in Less Developed Countries. A mobile user on a network that supports Wikipedia‑zero , for example, has unlimited no cost access to all of the information contained in the online encyclopedia. Further, it is argued that providing free access to a popular content or social networking site will drive more general demand for more access to the open Internet and will encourage investment in infrastructure.
Zero‑rated services also require network operators to discriminate among sources of online content and services, creating strong incentives for their subscribers to access the content and services of their identified partners over others. This type of preferential treatment for certain content providers challenges fundamental principles of network neutrality.
In June of this year, we saw Chilean TeleCom regulator Subtel declare that zero-rating programs violated net neutrality law and banned such deals from operating in Chile.
In the mist of this activity on both sides of the issue, it remains the case that the hypotheses that zero‑rated services lead ultimately to wide‑spread express to free, open and neutral Internet, has simply not been rigorously tested.
So to help us explore more deeply these risks and potential benefits of zero-rating, we have a collection of expert panelists. To my left, Josh Leavy from Access; Yana Welander from Wikimedia Foundation; Eve Nissim from Orange; Helani Galpaya from LIRNAsia; Berin Szoka from Tech Freedom; and Olga Cavalli from the Ministry of Foreign Affairs of Argentina.
And so I think to get us started and get a little bit more in depth into a particular zero-rating service, I'd like to turn to Yana first to talk with us a little bit about Wikipedia Zero and talk with us about how the program operates, what considerations does Wikimedia take into account when offering Wikipedia Zero, and how has the program been received.
>> YANA WELINDER: Thanks, Emma. As most of you know, the Wikimedia Foundations is a nonprofit organisation that posts Wikipedia and other freely licensed sites. So our mission is to provide a platform for speech and empower people to generate educational content and then to effectively disseminate that content globally.
So when I think about the digital divide, I don't just think about how many people are able to use the Internet, which is of course a really important consideration, but I also think about how many people can access knowledge and participate in knowledge creation.
So that is what Wikipedia‑zero is all about. It is intended or sort of designed on the data showing very high mobile penetration in Developing Countries, combined with high data prices that are still making it difficult for people to access the Internet. So the goal is to get carriers to provide access to people that need that access the most, free of data charges. And that may just be a temporary fix until they are able to access that same information on the Internet without zero-rating.
And so, I think because Wikipedia is provided by nonprofits, the open Internet is incredibly important for its operations. So we need to make sure that the educational content that our users create is not being blocked or slowed down in any way. So we talk a lot with net neutrality advocates to try to figure out how we can operate in a way that will protect the open Internet.
So, we have come up with 10 operating principles to structure Wikipedia Zero. And they include the idea that there is not supposed to be any payments between the carriers and the Wikimedia Foundation as a result of the zero-rating. And that Wikipedia Zero is not supposed to be part of any service bundles or sold as part of any service bundles.
Carriers don't get exclusive rights. To the contrary, we try to partner with as many carriers as possible in each country so that we can reach out as many use users at possible. And we try to collaborate with other public interest sites so they can take advantage of our infrastructure which is all open‑sourced to zero‑rate their content as well.
And we also work around the principal of transparency which is really important to net neutrality. It is one of our fundamental principles at the Wikimedia Foundation. So we post a form agreement on our site along with our 10 operating principles we work closely with our volunteer community in the countries where we provide zero-rating, and we provide notifications to end users to let them know when they are on the zero-rating sites.
So that is just some of our early thinking around how we can serve the open Internet but we are continuing to talk with net neutrality advocates about that.
To answer your question about whether the programme has been successful. To date, we have been operating for two years, and I think the places we have been most successful is where we've had a strong grass root movement in the country.
So one example of that is Nepal where the Wikimedia contributors were urging us to make Nepal a priority country for Wikimedia‑zero. So they were seeing a -- or we were all seeing high mobile penetration in the country but we were also seeing lots of people were using mobile phones to access Wikipedia and also to try to edit Wikipedia.
We had one user in Nepal who doesn't have a desktop computer but has been editing on his future phone and contributed over 6000 edits to Wikipedia on his phone. So that is just an example of how mobile can be used as a speech platform. So once we enabled Wikimedia‑zero in Nepal, we had a 100% increase in mobile page views in the country. So, that was a very successful launch.
And then generally, Wikipedia‑zero now operates in 30 countries. It provides free access to 350 million people, or subscribers, and we have about 65 million zero‑rated page views per month.
>> EMMA LLANSÓ: I'd like to turn to Eve from Orange which offers Wikimedia‑zero and Facebook‑zero on its carriers in Africa and the Middle East. And could you just tell us a little bit from a carrier's perspective, what is the appeal of zero-rating programs? And what effect have you been able to see in terms of zero-ratings programs effect on individuals use of mobile Internet access? Has it affected subscriber numbers and have you seen this transition from using zero‑rated programs to using broader Internet.
>> So I'm the Deputy Chief Officer of Orange. And I will talk about on behalf of Orange because this program was launched in orange. But Orange is also part of the industry dialogue effort. And if the conversation comes to it, I will mention it. So just to set the scene, we are talking about access, Internet access going from mobile network, essentially. There is about 4.5 billion mobile subscribers around the world, only 3 billion subscribers on fixed access.
Orange operates in Africa and Middle East. That is where we launched the experiment in this area. There is only 4% Internet access coming from fixed access. So, really to set the scene, we are talking about mobile data access.
As an operator, we are operating in Africa and Middle East and we do have a lot of operation down on the field with a difference to other Internet players who could send their services back from California, we do have a lot of people on the ground. And actually, 98% of these people are locals. We are very, very few in Africa and in Middle East.
So, when it comes to getting to the service that Wikimedia Foundation proposed us, we thought it was aligned with our corporate social responsibility strategy.
As I said, we have many people on the ground, and we feel that the responsibility of a TeleCo like Orange, is to participate in a win‑win type of action in the development of a country. So we do bring help and infrastructure for education, for health, even from time to time for agriculture. And we thought we could make a zero‑rating service was a good way to bring education to our customers freely.
Just also to set more the scene, the use of a telephone, mobile telephone in this area, is just for voice to start with. And usually, they do share one phone for a whole village or one family. So access to data is really far away from their education.
Since we made this offer with Wikimedia, we thought it was a good way to introduce usage of data through their mobile phone. So, the offer concerned 20 of our countries, about 70 million potential customers. The deal is that, if you do have a SIM card from Orange, then you can access to Wikipedia zero-rating. Okay?
Again, this is done to develop education. There is no calculation from us saying that we want to provide first‑step access to Internet so that we would have a million customers joining us. We do have many action plan in terms of social responsibility in which we do provide freely access to entrepreneurs. We do company incubators in those countries. We do provide access through education. We do give Internet access to schools over those areas. So this is really part of a huge corporate social responsibility and foundation programme from Orange. That's why we did go to the association with Wikimedia.
Now the second part of the question. Do we think this would bring an increase use of mobile data through our services? I feel the answer is yes, but it's not a short‑term. It is a long term view like all the responsibility of the Telecos made for long‑term development of a business. We do feel that a responsible TeleCo in the long run is going to win the race.
So this is about the situation. We don't have a simple and fast calculation to determine what is the percentage of the users of zero‑rating services we will get as regular customers. We are not in this kind of calculation.
And the last part of it, I'm going to launch the question in case someone wants to grab it. At the IGF, we speak a lot about Internet access, and most of the access people are talking about are their fixed access. And when we spoke about shut down of networks, very few discussion are going on, on the mobile network shutdown. On the SMS, the first and easiest service on the SMS shutdown, so if you guys want to keep on going on those kinds of questions, I'll be happy to keep on answering on those. Thank you.
>> EMMA LLANSÓ: Thank. I'd like to turn to Berin Szoka to ask, how do zero‑rated services compare to sponsored data programs like, the ones that AT&T and T‑Mobile run in the U.S.? Is there research available to tell us about how these programs have influenced mobile usage?
>> So let me just start with a more general framing for all of this to explain why this is being done in the U.S. I think it's the same reason it is being done overseas. Zero‑rating plans are best understood as joint marketing agreements. It's a way for carriers to work with marquis content providers to increase demand for the product. This has been practiced in the U.S. among segments of the market that don't see the case for adoption and it's being practiced internationally for the same reason.
The U.S. for the last four years has been very focused on goals of the national broadband plan, how to get people online. And the research shows that in the U.S., the major reason for people not adopting is a lack or perceived lack of relevance. People don't understand why it is good for them and why it is something they should adopt. Zero‑rating plans, sponsored data plans, are simply ways for helping to make the case to people to get online, to take the first step.
And the number one reason that I would suggest that we shouldn't be worried about them is that they are joint‑ventures. The carriers in these cases, have very strong incentives to convert people that sign up for zero‑rating plans into full subscribers it's not in the carrier's interest to sign people up for zero‑rating plans and then lock them into a walledgarden. Which seems to be the concern internationally.
So the paradigm I would suggest to you that is true in the U.S., that is true in many foreign markets, is the that people are getting online, are helping to be convinced that this is worth doing and then converting over time into heavier users.
Let me just talk about two answers to your questions. In the U.S., two examples. In 2011, Metro PCS which was the Number 5 carrier in the U.S. wireless market was in a very difficult position. It was trying to figure out what its future was going to be, how to compete with the Big Four carriers, they decided that their niche was going to be to reach out to those people who didn't have wireless phones. And that was specifically the poor and underserved and minorities in cities across America.
So they offered a $40 unlimited voice calling plan with a small data allowance but then importantly, unlimited access to YouTube. So that was a kind of zero‑rating programme. It was one where they were able to work with Google to make that technologically work better, to optimize YouTube streaming on their network. That programme was launched at the end of 2011 and abandoned fairly quickly because of the backlash because of some of the people on this panel, frankly.
So a year later, Metro PCS decided if they weren't going to try to market their services in a way that would be compelling to the poor and the underserved, it wasn't worth staying in the market and they merged with T‑Mobile, the Number 4 carrier. So they simply abandoned their plans. And so that business model of trying to reach out to the underserved in the U.S. was essentially abandoned.
This year, AT&T launched its own sponsored data programme, a more general programme that can do that zero‑rating as well as allowing anybody who wants to, to participate. The thing I think AT&T did extremely well that Facebook didn't do well when it launched the Zambia programme, was making it very clear upfront that anybody, any content provider, could apply to participate in the programme. So they made that as transparent as possible. I think going forward, that is a very good way for the providers who are engaging in these programs, to address some of the concerns, legitimate concerns, raised about who can participate. So, AT&T makes open to anybody. We have seen small companies get into this market
There's a company called, Sintonics, start up based out of Seattle, that is offering a store for all sponsored data that is available on the AT&T plan. The basic idea is that any of those plans, any of those services don't count against your data cap. It's the same idea, simply being applied for both the bottom of the end market and for content providers that maybe use more data that are not as immediately compelling as Facebook or Twitter. And in that sense, the AT&T model is a very good one, precisely because it allows any small provider, not just the big ones, to compete.
And then lastly on your question about the data. We don't have a lot of data. I would caution everybody here against setting the requirement that we have to have clear data to allow this. The history of the Internet has been precisely that Internet services have flourished because we presumed that innovation was a good thing and we waited to see how it played out before trying to ban it.
We do have some data and the data I think is pretty encouraging. If you look, for example, here in Turkey, in Turkey, Turk Cell, the large provider here, has had two major pushes for zero‑rating programs. In 2010, the first push was for Facebook and then 2012 it was for Twitter. In both cases you got unlimited access to those services. And Turk Cell saw huge numbers of people both accessing those services and then becoming Turk Cell subscribers. The important thing, bother noting is that Turk Cell structured their programme as a limited time promotional offer. They didn't do it forever, precisely because as I said, what they want out of these joint marketing agreements is for people to sign up for data packages.
So you saw, for example, a 340% increase in mobile Twitter use after the campaign in 2012. And in 2010, Turk Cell saw 6.5 million Turks getting online and using Facebook through their programme. So I think those are great numbers. For Turk cell it was a success. They saw revenue per subscriber go up by 9%.
I summarize this by saying the net neutrality conversation is normally very frustrating because it is perceived as a tradeoff between the sacred value of neutrality against secular values about how much money a carrier makes and things like that. In that framing, neutrality always wins. Here it is very clear we are talking about, if you will, sacred values on both sides. Neutrality concerns about access and transparency, which I think are quite legitimate. And on the other side, the sacred values of access about both on the one hand increasing adoption, getting people to get online who don't see the value of it. On the other hand, helping the carriers get the scale they need to fund deployment. So it's about building better networks accessed by more people and lower prices.
>> EMMA LLANSÓ: Thank you, Berin. As he alluded to, net neutrality advocates raised significant concerns about zero‑rating programs. So I was wondering Josh, if you could walk us through, what are the concerns? What kinds of threats do you see zero‑rating programs posing to access to the open Internet.
>> JOSH: Sure, there is a lot to chew on there. I'll start by saying a few things. Berin is talking about zero‑rated programs and this larger debate as if the number 1 concern should be whether or not TelComs can get new subscribers. And I don't really see that frame in the same way.
I think the big question is whether or not people can get online and get the information they need. This false suggestion that people don't see the value of the Internet, I think it is actually a very dangerous one. I think a lot of people see the value of the Internet and want to be able to get online in whatever way they can, which is why some of these zero‑rated services are appealing to people.
Let's be clear. Net neutrality is important. It is a sacred value. And I don't think that it runs counter to the notion of access and I don't think that we can either have zero‑rated services on one hand, or net neutrality on the other. I think that there is a way we can get people online in an affordable, accessible way, in a way that doesn't shunt them off to a walled garden, in a way that gives them access to the full and whole Internet.
Now here are other reasons why we think these zero‑rated services are problematic.
So first of all, the notion that some services or some zero‑rated services do not violate net neutrality, we find that to be false. Net neutrality is a principle in which no service or application or website is given preferential treatment. If you're giving preferential treatment to a zero‑rated service, to a lot of us, that therefore is a violation of the principle of net neutrality.
So our friends at Wikimedia whom we respect greatly and sometimes have gentle disagreements with, argue that Wikimedia‑zero is not ‑‑ or doesn't violate net neutrality, but because it is being treated preferentially by telecoms that they make deals with, we see that as a violation of net neutrality. So there is that and much debate there.
But why does that matter? Why does it matter we are violating net neutrality? What is so special about net neutrality and the sacred value? First of all, if we set this precedent now, which we are doing in many countries around the world, where telecoms are making deals with companies like Facebook and Twitter. Organisations like Wikimedia. We don't really see a way to go back from that. What you end up doing is creating a strong incentive for telecoms and these companies to broker these so‑called temporary deals. The deals work because people do want to get online and telecoms take that opportunity to normalize this kind of discrimination. And start applying it in different and more creative ways. All of which make it harder for people to access the full unfettered Internet. Instead, they will be offered more packages for more money.
And you'll start seeing that start. People will want to get more services and maybe want to branch out from Twitter and use Tumblr or something else. But that will cost a little bit of extra money. They still won't be able to get, if they click on a link and want to view a website outside of those gardens they may not be able to do so without paying a fee. We don't think it has to be that way. It's a false choice between free access to special services and no access at all. You can have access for a reasonable price that gets it into the hands of billions of people that want it over the coming years.
So one more thing about net neutrality. I think we will talk about that a lot. I don't think it is fair to have that principle get lost in this discussion. It is a principle that is at the foundation of the Internet as we have come to understand it. It is, in my opinion, the reason why many of us are here in the first place. It is the reason why a lot of people are involved in the broader fight to protect people's ability to express themselves online and to shunt it aside and to instead talk about the Internet solely in terms of subscriber growth or in terms of getting one product into the hands of people and calling it the Internet, I think it does a huge disfavor to the foundational principle behind the reason why we are here in the first place.
>> EMMA LLANSÓ: Thank you, Josh. Now I'd like to turn to Helani Galpaya to talk about one of the primary arguments in favor of zero‑rated services that they spur demand for mobile data plans and Internet access more generally and create incentives for investment in network capacity and build out. Is there data to support or refute this idea?
>> HELANI GALPAYA: Thanks. I am from an organisation called LIRNEasia. We work in South Asia, Southeast Asia and the Pacific Islands and we primarily focus on people at the bottom of the pyramid, the poorest in these countries. And the facts are that very few of these people are online, despite having incredibly cheap data plans on mobile, high mobile growth and high penetration and use.
The numbers are around 20% for the whole populations in Sri Lanka and that is one of the better creases. If you talk about the people at the bottom of the pyramid, in India, in 2006, this is a representative of all the people. So representative sample survey. 72% in 2006, did not know what the Internet was when we asked them in the representative survey. Now by 2011, luckily, only 24% said they did not know about the Internet.
In 2006, 28% said they know about what the Internet is but they never used it. And by 2011, this number had gone up to 74%. So most people knew about the Internet. And yet the percentage who use the Internet among the poor was around .1%. It went up to .2%. In Sri Lanka it was .9%; Thailand 21%. I'm talking about the poor people, socioeconomic economic classification DNE. So this is a problem.
The zero‑rated content has been viewed as both a way, this very altruistic way of bringing people way into the Internet economy and, from the operator's point of view, gaining market share and making it attractive.
So why do we need this is the first thing we need to ask, right? So we've had years of bad competition in these countries. One of the arguments for people not using Internet is, I don't need it, as you said, and you don't quite believe that. In our countries, yes there is a group of people who say, I don't need it, but as you saw, there is a huge group of people who say I don't even know what the Internet is and a third group of people who say I know it, I might want to use it, but it is so unaffordable for me.
Let's take the third thing. Why is it unaffordable? It's because there are key parts of the broadband or Internet data chain, the physical data value chain that are uncompetitive. The international backbone for most countries, the prices are very expensive. The international gateways could be, there could be national backbone access problems, which keep prices high. The lack of competition is a fundamental issue.
So, for years regulators have done a poor job, even if the networks are rolling out, of actually making sure enough people are getting connected, i.e., enough people can afford to get connected. In light of this, a new service like the zero‑rated content comes in, I think it's a little rich for even regulators and everyone to jump on the bandwagon and say, well it is a holy principle. Yes, the principles are holy but the facts are that our people are not online.
So what is the fear? Facebook becomes synonymous with the Internet and that is a legitimate fear. Do we know this? I think in my part of the world, we actually do not know this. Now you presented nice information about Turkey. I think we need more evidence like this.
The only closest thing we have seen is in the adoption of telecenters, which was an earlier attempt to get people online. Now telecenters were criticized for being financially unviable, not doing the right thing, hugely capitally intensive but it also got people some people online.
Now many telecenters went out of business in Asia but there is now evidence that they did have the priming effect, that is, they made people aware of this thing called digital life or the Internet or what you can do with a computer. So maybe the zero‑rated content will have this effect.
I do agree with the argument that as a competitive tool, this brings people online. It gives critical mass for network roll out in countries. I think the test bed for this will be Myanmar, which is sort of the green field TeleCom development that is happening right now. And have you got one operator, at least, one that I know of, has offered Wiki‑zero and maybe FACEBOOK‑zero as well. And telenorwitch, as far as I know, hasn't. And they started rolling out last month and this month. Now this will be the test bed to see what impacts. And the roll out plans are quite similar at the moment. They are all going to the metros and the urban areas. And we can see from Myanmar what the effect of that is going to be and whether that in fact does lock in users.
And on the final piece, in our surveys, not in the quantitative, so what I'm saying now is not representative unlike what I said in the beginning of my talk. We have multiple instances of people when we go to the field and we do studies and we are asking them, do you use the Internet? No. And then we look through their phone and there is Facebook. Do you use phase book? Yes.
So, for them, as techies you tell me this is the wrong answer. Facebook is the Internet. But for people, social media was Facebook or some other application. This was in Indonesia, which has the second highest number of Facebook users in the world. And even among the poor people, there is about 7% of the people using Facebook. And that has nothing to do with zero‑rated content. That was just how things were. And I know many teenagers whose only Internet use is social media. So this utopian idea that we have when people have Internet access, they'll utilitarian content and they will check market prices and they'll find jobs. It may happen. It may not happen.
So maybe everyone doesn't use the Internet the same way and for some people, irrespective of zero‑rated content, social media could be most of what they mean by Internet.
>> EMMA LLANSÓ: Thank you. And now for our last sort of initial impression, I'd like to ask Olga, from the governmental perspective, how do you evaluate the potential costs and benefits of zero‑rating services when thinking about public policy.
>> OLGA CAVALLI: Thank you. Hello. Can you hear me? No? Hello. Closer? There? Yes! Very close to the mic. Okay. Good morning. This is such a big audience. I'm impressed. Thank you for being with us this morning.
First of all, thank you for the invite. And I would like to clarify my comments will be more as an academic than a governmental official, because I don't do exactly this work at the government, but I do investigate this as a University teacher at the University of Mont Cyrus and this year I have been investigating this issue about content, mobile networks and the Internet in Latin America.
So having clarified that, I'm also an expert in regulations. So, this is why we have been studying this at the University this year because we find it very important.
Before starting, I would like to give you some figure that is I brought from a study made by ICLAC, the Economic Commission for Latin America and the Caribbean, about Internet access, mobile Internet access in Latin America.
So, the price that people pay for Internet access in Latin America is quite high, and this numbers are related in relation with the percentage of GDP per capita that people have to invest per country to access the Internet, mobile Internet. There are some countries that it is more than in between 12‑16% of the GDP per capita that they have to pay for the Internet access using mobile, in Nicaragua, Bolivia and Honduras. There are some other countries pay 7% or 6%, which are Guatemala, Paraguay, El Salvador and Peru and the countries less, like Columbia, Puerto Rico, Panama, Brazil, Costa Rica, Chile, Argentina, between 1.5 and 3% of the GDP per capita and other countries a little bit less, compared with maybe less than 0.5% in Europe or less in Japan.
So this is related with infrastructure with the high cost that our region has to access the Internet being in the south and the international connectivity prices for access in the Internet.
So, from the content perspective and having people accessing this content, we think that the zero‑rate is an opportunity for those users accessing the content here in the Internet. Our colleague here said people don't have a reason for accessing the Internet. Relevant content could make sense to have them getting online and once they get online, they could be more motivated to find relevant information.
The problem that we see that we found in the investigation that we did this year, is that somehow, it could be challenging for network neutrality. There are some regulations in Latin America a some already have regulations like Brazil, Chile, Ecuador have regulation; Argentina, not for the moment but there are some project going around that.
The challenge that we see is that, for example, the agreement that was described briefly this morning between Wikimedia and Orange, would any company producing content be able to do such an agreement with Orange? That is the question that we have. Is all the companies small and medium enterprises producing different contents? Especially contents that are relevant to communities and languages or local language or relevant content for some communities which are smaller. Do they have the opportunity to go to such a big company like Orange or other operators in the renal on and do so with such agreements?
So for the perspective of regulation and for being really neutral, those small and medium enterprises could be also able or should be also able to get to the big companies and do agreements and let people access those contents.
In this sense, this content available for people could be more neutral in relation with not allowing only big corporations and big content generators to have access to the mobile user. So this is where we see the challenge for the policymaker in becoming a fair access to all the content producers to the mobile users.
But we see value. We saw value in the investigations that we did at the University in having this content to more accessible to the user, especially in relation with the, what they pay for the service, that as you see in some of the countries of our region, is very high and of course, as our colleague from Asia was saying, you know the people with less income is the one that has more difficulties in getting into the Internet and have access the content. So this is my comment for the moment. Thank you.
>> EMMA LLANSÓ: Thank you very much. I'd like to see if the panel can build a bit on Olga's last point there. One of the critiques I have seen of zero‑rating programs, in particular is that it's not just a company offering free services in a way that might be net neutral. It is in particular, giant U.S. Internet companies.
How much has this dimension of the issue come up in your work and study that you have done for any of the panelist? Is there or are there concerns about sort of lock‑in of major U.S.‑based services as the primary way to access online content? Or is that not seen as a concern? Is it seen as a benefit? What are your perspectives?
>> YANA WELINDER: So I think in the case of Wikimedia, it's not quite true that it is a giant U.S. company that is being zero‑rated. The content is created in a decentralized manner by local communities. So the information that is being zero‑rated is local language encyclopedias, and we have 250 plus local language or any language encyclopedias. Wikipedias. So that information created in those countries and so it is not any kind of U.S. curated content.
And the other thing is that describing it as a walled garden is not very appropriate for a non‑commercial platform like Wikipedia, where you have encyclopedic articles written with links leading out to anywhere on the Internet. So the whole point is to link people out to the places where the content was recently coming from. So I think you constantly being taken out of Wikipedia.
So I think that is just the false representation of how Wikipedia works.
>> Quick response to that. Facebook has links out to the rest of the Internet too but I think we all can understand it as a walled garden. I don't think anybody would disagree with that.
>> BERIN: I disagree with that. Precisely.
>> Except Berin.
>> BERIN: So it does have links to the rest of the Internet. If you look at the details of Facebook‑zero's programme, they actually in some countries included data allowances for following some of the links out.
So I think we need to take a step back here. First of all, we need to ask what are these programs actually involving? And second, what is going on here economically? This is a business venture. So it is worth thinking carefully about what the incentives are.
So the incentive in any joint marketing agreement is to get people see the value of the product. So in order to do that, you need to have marquis content that is attractive to people. Facebook and Twitter are attractive, not because they are big U.S. services, but because of network effects. It's the very reason that people worry about them but it's because they just like WhatsApp, allow people to communicate with networks of other people. So it's not an accident that they are being included for those reasons.
Then you have to ask, why are these carriers including other sources of content? Why did Facebook, when Facebook developed the app in Zambia, that the carrier offered for users, why did Facebook include local content? The reason again is relevance. Because if you're going to offer a package to people, you want to offer them things that they are interested in. So it's the very same reason, for example, in the U.S. market that T‑Mobile, which is our Number 4 wireless provider as I mentioned, they bought Metro PCS once Metro PCS decided it was no longer viable for them to try to target solely the lower income market in part because they weren't allowed to do sponsored data and criticized by people like Josh.
So metro PCS turns over their programme to T‑Mobile and T‑Mobile now offers a slightly different set of services where they include music streaming. It's very attractive and people get excited about that. It doesn't require a lot of data but it's a great marketing vehicle and they include, yes, big established providers like Spotify and Rhapsody. But they include services like Black Planet. The reason they do is not because they want to look good or makes them feel better at night; it's because that's an attractive marketing vehicle to the demographic that they are going for, which is African Americans in the U.S. who haven't adopted previously.
So understanding all of this, when you look at these markets, it's not an accident internationally that you see carriers offering packages that include not just Google and Facebook, but local sources of content as well. So again, I think if you depart from understanding the economic incentives here, and you start to default to Josh's assumption, despite all the data that this is just about infringement on Josh's sacred principle, you miss the benefit here of these sponsored data and zero‑rating programs for the world's poor, which is actually dealing with the thing that the data tell us, which is people don't adopt precisely as people on this panel were saying, because the case hasn't been made to them that this is useful to them.
So it's very easy for someone in the United States to sit back and say that access now means access to the Internet exactly as it looks in the United States. When in fact, the details on the ground are that carriers have to figure out how to fund deployment, figure out how to get new subscribers and this is the way to do that. This is how you deliver access now to people. It's not necessarily what Josh wants in a perfect world, but it is not only a good first step but it is a step in the right direction. It's not a step that leads towards walled gardens forever, for the very reason I mentioned earlier, which is the carriers here are ultimately driving these programs and they are the ones who have the incentive to convert people into paying subscribers, which is, that's the capitalist version of access. It's not a bad thing it's something we all should be celebrating.
>> HELANI GALPAYA: I think local has been a problem and is a fundamental problem in Asia, emerging Asia, irrespective of zero rated content. People on Facebook -- for network effects, because it has cool stuff and your friend, and I think the solution to that is to have ‑‑ if you want local content, you need to produce more local content. You need more local content giving apps and irrespective of zero‑rated content, there are no killer apps. There aren't that many killer apps that are relevant in these countries. And the reason for them not emerging are multiple and not the purpose of this panel. There is a lot of other sessions on this. But that needs to be addressed and the fundamental threat to the lack of a local app economy, which gives local apps and relevant local information, is not Wiki‑zero or zero‑rated content at the moment.
Now, we have one case in Sri Lanka ‑‑ by the way, our world, these poor people, they use operator walled gardens regularly when they do come online. So it's not just Google Play and the App Store. So operator walled gardens are quite common and Android is the dominant platform. And in Sri Lanka we had operators running how to write an Android app kind of things.
One of the most popular apps that came and is used, promoted and used by the largest number of people is a social media app. Shocking, right? This is for people who want a different local and feel, the local language, et cetera. So even that barrier can occasionally, and this is anecdotal, can be crossed.
>> OLGA CAVALLI: Thank you for all the comments. In relation with local content, I think one major issue is language. I speak a language that is spoken by millions of people, but if you check how many articles are in Wikipedia in Spanish, you will be surprised that in proportion, it is less articles in Spanish than other languages like German or Polish. If you consider the amount of people that do speak Spanish.
So, having relevant content in Spanish is a major barrier for access in the Internet. Not only that but also mobile. People find relevant content especially in English. And not everybody Latin America or Spanish-speaking countries to speak English the way you need to access and understand the content.
So, the challenge is to bring this relevant content in local languages for the usage of the people, for the relevance of the usage of the people. So, my big question is for maybe our colleague from Orange. Is it easy for a small local content provider from a community, say in the interior of Latin American country, to go to a company like yours, which say major service provider and make an agreement to make available this content in such a way that they can access more in a cheaper way or easier way? Is there a way? Or maybe they can go all together and you could find a way to put them all together and try to make agreements with all of them? Thank you.
>> I'm going to try to answer a few of the questions and then answer also your question. I will get back to again corporate responsibility.
The way we do consider our responsibility is a strategy. It's not just our foundation. It is really our strategy, long term strategy to be responsible. And the way we do address local markets is through stakeholder dialogues.
So if we did maybe the deal with Wikimedia, it is because we understood that there was a huge demand for local and education local content. And the tool that Wikimedia offered us was adopted for the demand of the population. Locally your answer is, if the demand is strong and if we operate in the country, which is the two main reasons, then there is no reason why we could not work together with smaller companies.
And finally, what is important? And I would join forces with my colleague on my left, it is incredible that for intellectual reasons we feel that zero‑rating services are not compatible with neutrality and that we do reject such services which are the basic demand of countries like my colleague on my left said, that are for people that need the first‑step access to Internet. As a Teleco, our responsibility is to educate people to use this Internet.
Of course on the long run, everybody is going to be digital and the business of the company is going to be bigger. That is the mainstream. But we do feel that education is very important. We do feel that communication is important. Let me place a few of the villages in African countries where people, cousins or family, living in two different villages that are maybe one helped miles away from one another, couldn't R. couldn't talk to each other because distances were too long and suddenly because we do offer zero‑rating communications services, they can again communicate and get in touch.
So under any name or any intellectual consideration, I think those zero‑rating services are a first step access to Internet services that do serve the population in which we operate.
>> EMMA LLANSÓ: I have a follow‑up from Josh and then to the audience for questions.
>> JOSH: Thanks. It's so awkward. So a couple of things. There are these interesting assessors being made that for example, I'm the only net neutrality supporter in the world. Not true. Turns out a lot of people in this room, I think, are supporters. And millions of people around the world have voiced their support, formerly and informally. So, this issue is not one person's issue or one person's ‑‑ to continue this sacred metaphor, one person's crusade. It's something that a lot of people recognize as foundational. Okay?
I also want to acknowledge that this discussion is about serving the needs of people who desperately need access to information and I don't want to lose sight of that. And I think that talking about the assertions I'm making as some sort of an intellectual exercise isn't fair. We are all trying to find the best way to get people the information they need and to serve people. We all have varying avenues for doing that.
And business is a huge part of that and I think that civil society and businesses can and should be and do work together to figure out the best methods for delivering information.
One other point, though, when the first billion people came online and got access to the Internet, it wasn't through zero‑rated services. They got access to the full Internet. So I don't see why we can't continue to strategize about ways to get the second billion people online to using the full Internet.
>> EMMA LLANSÓ: We have to go to the audience for questions. They have been waiting so patiently since 9 a.m
Start here in the front and work our way back. I'm not sure if we have roaming mics so maybe project.
>> AUDIENCE MEMBER: So, Josh, I want to say that I appreciate and respect this pursuit of perfection of creating the ultimate Internet experience. I just want to remind that sometimes we may make the perfect the enemy of the good. When I look up that the table of panelist, I see all Apple Mac, laptops with the exception of one. And so, you know, I guess my point is, we were all going to come to the Internet in a nonneutral way whether it is an Apple device or Mozilla browser or Google search engine. There is always going to be something that may influence us in some way.
We are all limited by our language, where we are born. What we experience when we are children. We can't get over that. And in many ways that's an advantage. But the part about getting on the Internet is we will use it to find our humanity. So, I have to disagree that people cannot go to Facebook and find out for themselves and go beyond that.
So, the thing to point out is that even when people buy full Internet packages as they do today, and I used to work in the analytics business and I know this, is that they overwhelmingly choose a few content and application services above others. So even though there is a world of content that most users tend to go to the same.
So, this is not as an idea to try to put people down a certain track but on the other hand, what you're asking is, if we have to be perfectly neutral, then we have to build our own computers and learn how to programme for ourselves, we can only use open source software. And we have to participate in boring user net services. And instead of taking advantage of all the wonderful engineering that has been brought to bear and take that. So could you address that?
>> Josh: Can you explain to me what Apple has to do with net neutrality? I'm confused by that. So, using a Mac computer I understand that open technology and the open hardware versus closed hardware but I'm using a browser that is giving, not in this country but in other countries, me full access to the Internet. That seems to be platform or computer agnostic.
>> AUDIENCE MEMBER: (Off Mic)
>> JOSH: I think we are talking about, no pun intended, Apples and Oranges here. And there is a separate conversation that I think you're raising important points around open source hardware and software. But when you're talking about using a browser, which is again platform agnostic to access the Internet, which is its own platform, I think that that is the conversation here and I'm happy to continue having that. But I think talking about whether or not people are using what consumer choices they are making is slightly besides the point.
>> EMMA LLANSÓ: We have a lot of questions.
>> AUDIENCE MEMBER: I don't have a question. My name is ‑‑ I'm from Wikimedia Germany. So is just important to give a different view on Wikipedia‑zero also out of the movement.
I love Wikipedia. That is why I'm happy to be an elected member of the board of Wikimedia Germany. But, I'm also happy to see that we have some principles. And these principles are not holy and not sacred. I think the Internet is not a religion. So we don't have to talk about something which is holy or sacred.
We use the Internet quite rational and apathetic and most of the time without clever rhetorics. And so let's have some utopia because we are on the IGF so why not have utopia. So all the content which needs to be in the public like educational stuff, and all the good knowledge things which should be free for everybody, and this is the talk we have and this is the utopia which is maybe not shared by the mobile providers because I don't think that if the Stanford University and maybe the University of Zambia having a very cool video online course, programme with 20,000 videos, that if Wikipedia would join together with Stanford and Zambia University the mobile providers would be hurt that many video traffic, the big thing, not this little Wikipedia text‑based thing, would be a part of the free‑knowledge world, then maybe they would rethink the idea of giving zero‑rated access to all free knowledge of the world.
Therefore we have to be aware that zero‑rating is a marketing tool and that is it. It's used to bring people as customers to certain providers, which is fair enough, but then again, but then you have to ask yourself do, I want to be a part of that marketing trick?
And as we learned, and I have to remind you, Wikipedia ‑‑ don't use Wikipedia as your only source. That's what we always say in presentations. But Wikipedia has a very good entrance to learn things but of course it is only an entrance. That is why the encyclopedia is looking for a very good ‑‑ having sources. If you don't source your article, your article will be deleted for good reason. There is also a lot of linking to the other areas of knowledge in the world.
And I want to resume because just a little trick. If you use Wikimedia‑zero and you don't want to become a mobile provider customer and you want to chat with your friends, you open up a user account on Wikipedia‑zero, let's say clever guy, clever girl Number 1, and you all can chat on the private side of this person in Wikipedia. And this is not clever because then what would happen is that really good ideas out of Wikipedia, which is used maybe for chatting online, would be disturbed because people find ways to use Wikimedia‑zero for other ideas then to use it as an encyclopedia. So that is why I think the net neutrality is very important. It's not holy or sacred.
If we lived in utopia, I would be happy to have all public knowledge as free access. I mean I'm the first guy to jump in. Then again, zero‑rating, it's not ‑‑ it's a little bit like there is some guys on the street selling some stuff and the first stuff is for free and then the second stuff costs money. So actually zero‑rating ‑‑ you make the Apple rhetoric so I have to do the truck dealer kind of thing.
So I mean, really, that is ‑‑ I agree that there is many different use of the Internet and we have to be open to the idea that maybe some people being six months on Facebook, discovering the real Internet somehow, but then again, nothing is sacred. But I think the net neutrality principle in that moment of the Internet, still very young, is more important than to be part of a marketing trick of some mobile providers.
>> AUDIENCE MEMBER: I'm from Comcast Corporation. We don't ‑‑ we are the largest U.S. ISP, we don't have zero‑rating because we are not a wireless provider. So we have unlimited data. But I have a question for the lady from Sri Lanka. We have a problem called Internet Essentials, which is basically a very, very low‑cost, 9.95 access for all families on the school lunch programme. And we have 1.2 million individual who have signed up for this. It is the largest broadband subscription adoption programme in the U.S.
And when we structured it, and I was really sort of gratified to hear your comments and also the lady from Wikimedia, about the impact of ‑‑ and BERIN, relevance, literacy and price. And we structured it so all three elements were covered. And we have, and this is based on FCC data. PEW Research Study releases this data every year. It shows about 30% of people in the United States, 30% of people don't adopt because of relevance. 30% don't adopt because of digital literacy and then 30% don't adopt for a whole range of cost‑related issues. And the ISP cost, FCC found and the PEW research found it is about 17%, that is the most that it has ever come up.
So the question I have is, we have found it very, very difficult, and we have partnered with Khan Academy for education content because we found that having content that is irrelevant to the folks who haven't subscribed, is a very big issue.
My question is, do you find that, in Sri Lanka, for example, is it an issue to get people to adopt broadband or subscribe? Is that an issue? Because it is an issue in the U.S. for people from low‑income communities, especially minority communities.
The second question is, when you structure those things, do you try to address programmes? Do you try to address all three as we have done? And we found even after doing that, it is very, very difficult because these are hard to reach communities. Do you find that experience in Sri Lanka too?
>> HELANI GALPAYA: Very short answer. I don't do these programs, the operators do. And content is one of the primary things. So yes, e-books in the local language is one of the quote/unquote, killer apps that the third largest mobile operator has launched in the market and is actually gaining market share.
And price is obviously fundamental. If you look at share of wallet, it is about ideally around 3%‑5% in most of the developed markets, and in Asia, we are looking 5%‑10% of monthly income. So even in the most affordable markets like Sri Lanka and India. Many are much higher. That barrier still has not been addressed and there are various initiatives like national broadband plans. I'm happy to talk about different initiatives going on. These three are primary.
>> JOSH: I'll say that two‑thirds of U.S. non‑adopters say they won't adopt at any price. This is the point of marketing programs. So there are people who are realist and who will say, all right, let's talk about this. Let's address the concerns about how you apply to participate in sponsored data programs. Let's make sure it is open. Let's make sure it includes local content and make sure that people ultimately are going to adopt full‑sides data plans. That will be a realist approach to net neutrality.
And then there are zealots who say they are in favor of access now but who are in favor of access later as soon as we can figure out how to deliver the perfect service that we think should be offered to everybody, but which we can't figure out how to implement because we have a luxury of not being businesses and not having to deal with the details of cost and getting people to adopt.
>> EMMA LLANSÓ: Next question.
>> AUDIENCE MEMBER: So that segues into one of the questions I had. There are a lot of different theories for good and bad on zero‑rating. I want to contextualize my comment. I want to talk about one, but it happens to be the one that has been most discuss, and this is the idea that the value delivery of marketing content improves the perceived relevance and increases scale will ultimately bring on more paid data subscribers that have full Internet access. There is a contrary point to that. The idea that some people who would pay for full data access choose not to because they are getting enough.
So it is like cable. If you could buy just ESPN, there are a lot of people who would, and they don't have the option to. So instead, they buy the full data package. The difference is, if you only buy ESPN and don't buy a full cable package, it doesn't have the same kinds of effects as if you only are accessing Facebook versus accessing the whole Internet.
First of all, I want to pause it here and I'm sure Berin will disagree, but generally people will agree that it is bad if we have many people who would have access to the whole Internet, who instead only have access to Facebook. And I think that is a numbers question. So I think there is a numbers trade off here which we don't have a data answer to. We don't know how many people would try zero-rating, find value from it and then switch to full, open Internet connections and we don't know on the other side, how many people would stop and would use zero‑rated services as a substitute for full Internet access and thereby slink that ecosystem and adoption.
Do we have that data? I don't think we do. Can we get it? Can we imagine surveys or something to try to figure out where these two different contrary data points go?
>> So one answer to that question just to ask whether the programmes are time limited and if you look at the Turkish market, it was a limited‑time promotion. It doesn't give you data but it does answer your question in the sense that in the Turkish market because of the cost structure, the carriers found it worthwhile to offer for a brief period of time and then convert people. It may be different in Zambia because the cost structure is different. I suspect over time it will move more towards the Turkish model.
>> I just want to highlight this. Our friend from Comcast is talking about the Internet essentials programme as a solution for low‑income consumers in the U.S.
This is a programme that multiple reports shown is failing to do what it is intending to do. It only is open to people if they haven't been previous customers of Comcast. This is true? Right? There are onerous requirements about school lunches that people have to meet in order to be eligible for this programme.
And it is also a limited time programme. And I think that it is a good example of how these very large providers who actually are providing a service, who are essential to our communities and to our basic infrastructure, can do more to provide that basic in from structure at affordable cost to the people who need it. Maybe you can build in some business strategies to bring people along so they end up paying a little bit more in the future, but I think there is more you can do today because the profits on the higher end are allowing you to do so that can really provide these services to people who need them most without constantly calling it a business plan and making this all about new subscribers.
I think actually, if you build out the foundation of Internet users in Comcast's case in the U.S. and also worldwide and people get used to this idea that there is a wide open Internet out there, then eventually as they have higher incomes, they will pay for more. But I think restricting