Internet Fragmentation > Zero-Rated Content

A Net Negative for Net Neutrality

Region: Global
Threat type: Creating Walled Gardens
Last updated: 1 December 2023

When providers offer something for free, sometimes it comes at a cost.

Some telecom operators and ISPs offer their customers a deal where some types of content is not counted against their data plan. For example, they might offer access to certain apps, streaming services, or messaging platforms, as much as users want, for no extra cost. This is referred to as a zero-rated Internet service. It’s often framed as a benefit for customers, and is part of how they compete with other providers.

While it is advertised as offering efficient costs and improved access, zero-rated services often are the result of commercial alliances between large platforms and telecom operators. The practice raises concerns about net neutrality and competition. It also increases the risk that service providers will disproportionately shape users’ preferences, and even their opinions.

With zero-rated services, people sitting next to each other on a train, for example, might have a very different experience. People may not be reading the same news or listening to the same music—or even be able to send a message to one another because of access to only certain platforms.

If there is one free social network, one free news provider—and so on—these can become what the Internet is for many users. It’s a fragmented experience of the Internet.

This practice creates new Internet gatekeepers, who have the power to shape our tastes and preferences by creating a walled garden.

Status

Zero-rated services are very common in mobile service plans all around the world. They adversely and disproportionately impact low income, marginalized communities, where people usually have smaller data plans (plans that are also far more expensive when comparing the cost per gigabyte). They are more likely to depend on zero-rated services, and cannot choose to use a different service because they don’t have available data to do so. Zero-rating practices vary by region, and there is an ongoing debate across stakeholder groups about its impact and regulation needs.

Our Position

Zero-rating violates one of the core elements of net neutrality because all traffic is not treated equally. This is not just the case with technical traffic management, but also applies to the commercial practices of Internet Service Providers (ISPs). It fosters potential market consolidation by already dominant players, and has a negative impact on the open Internet. It undermines the open, global Internet and harms innovation and growth.

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Talking Points

  • If your mobile provider offers you free online services as part of your data plan, it might not affect you directly, but it affects others. For those who cannot afford to pay for extra data, this means a fragmented Internet experience, based on who you are, where you live, and how much you can pay.
  • The people who need the Internet the most, and benefit most from the opportunities it provides, are the most adversely affected by zero-rating practices.
  • Zero-rated services harm net neutrality by favoring certain services over others. And this, in turn, increases the risk of the market consolidating in the hands of large telecom providers, ISPs, and large platforms. This distorts the market and fair competition.

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