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In India, Fierce Opposition Builds Against Facebook's Free Basics

This article is more than 8 years old.

This story appears in the January 2016 issue of Forbes Asia. Subscribe

A ferocious resistance has built up in India to Facebook's ballyhooed Free Basics initiative for low-end Web access. The country's telecom regulator has ordered the social-site giant's program put on hold pending a final decision on differential pricing, which would allow service providers to give free Internet access through programs like Free Basics.

Free Basics is a Facebook-led service that claims it will improve Web access in emerging markets such as India by offering a pared-down version of the Internet with a select handful of websites, including Facebook's own. In India it would include Bing search, jobs sites, several news and reference options--but no other social domain.

Critics of Free Basics say the battle is actually a fight for "net neutrality," the notion that no one company or authority be allowed to create Internet boundaries based on data girth or other factors. The stakes in India are high for Facebook: The outcome of this battle may shape the fate of founder Mark Zuckerberg's pet project in dozens of smaller countries around the world. Opponents say the implications of Free Basics are not fully understood in many such markets; Egypt's government recently shut down the service. But Facebook is in a position to forcefully sway widespread adoption.

In India Zuckerberg himself launched a push last October for the newly branded Free Basics, introduced in 2013 as Internet.org and now offered in two dozen countries. He visited the country to lobby officials, promulgate the service to the country's software industry trade body, NASSCOM, and write a commentary titled "Free Basics Protects Net Neutrality" in a leading newspaper.

In the piece, he compared Free Basics to public libraries, public hospitals and government-run schools, and railed, "Who could possibly be against this?" He went on to say, "Instead of wanting to give people access to some basic Internet services for free, critics of the program continue to spread false claims--even if that means leaving behind a billion people."

(The service works through the free Internet.org app on mobile telecom devices. Reliance Communications, India's fourth-largest telco, says a million customers have accessed Free Basics. Overall, Facebook claims there are 130 million users in India.)

Facebook India spent millions of dollars in late 2015 buying newspaper ad space and massive billboards to drum up support for the initiative. In response, over 1.4 million e-mails were sent to New Delhi in favor of Free Basics. However, the move backfired in several quarters. "Facebook deceived users into bombarding the regulator with e-mails supporting Free Basics without even answering the regulator's questions on differential pricing," said Kiran Jonnalagadda, a Bangalore entrepreneur who is among those spearheading the volunteer group SaveTheInternet.

High-profile tech figures have jumped in, touting traditional net neutrality, including Vijay Shekhar Sharma, founder of Web retail and payment platform Paytm; Nandan Nilekani, Infosys cofounder and former head of India's universal electronic-identity program; and venture capitalist Mahesh Murthy. Nilekani wrote a counter-commentary to Zuckerberg's, calling Free Basics a "walled garden." He advocated instead subsidizing Internet data--with Facebook contributing toward a state fund offering, say, the first 10MB free every month.

In early January several Indian startups jumped into the battle against Free Basics by organizing a protest in the country's technology hub, Bangalore. They said Free Basics' select access would impinge on new entrants in favor of established Web entities.

India is a vital market for global technology firms, including Amazon, Facebook and Google, with huge growth potential. Nearly a billion of India's 1.3 billion people don't have Internet access. For Facebook itself, India is already the second-largest market after the U.S. Though India's revenue contribution is minuscule, Facebook hopes to change that. By contrast, China, with its state firewall and homegrown social networks, search services and e-commerce firms, is out-of-bounds for global Internet firms.

"India is the most electrifying Internet market because the Facebook of India is Facebook, the Google of India is Google and the Whatsapp of India is Whatsapp," said Ravi Gururaj, founder of QikPod, a startup building a countrywide network of parcel delivery lockers.

Yet it's an open question whether Mark Zuckerberg's worldview of basic access will be "liked."