Net neutrality and economics of free internet.....

What is net neutrality? 

In net neutrality, Telecom service provider gives equal importance to all web data that is generated on the internet.

It is like rationalizing the bandwidth so that each and every website will load on the web browser with equal bandwidth.

It is like giving equal opportunity to each website.


Why net neutrality is so important?

Let us take a simple example.

Let us assume there are two factories 'A' and 'B' in the town which produce orange juice.

Factory A has huge amount of money at its disposal but factory B is not that rich.

Now, assume that these factories are far outside the town.

Juice can be transported from factory to town by a truck service provider 'C'.

Truck service provider is the only transport provider in the region. So factory 'A' and factory 'B' have to depend on 'C'.

Everything is going on well for now.

But suddenly owner of factory 'A' says to 'C', " I will give you the money and in the favor you should use all your trucks to transport my product in the town."

Due to this business strategy, factory B will go bankrupt after some time as it can not sell its product in the market.

Ultimately, because of money power, factory 'A' won the battle even if product of factory 'B' was superior to that of factory 'A'.

In the similar way, in the digital world, factories are like websites such as Facebook , Google etc.

Transport service provider is something like telecom operators.

So if a big and rich website company  gives free service to people by paying huge amount to telecom operators, then people will use only these websites.

So in a first place itself competition gets killed even if the competition has better product offering.

If company like Amazon had provided huge money to telecom service provider then Flipkart would not have been established.

So if there had not been a competition consumers like us would not have enjoyed low priced mobile phones, computers and so on.

So the internet service provider needs to be unbiased and neutral.

According to Adam Smith, father of modern economics, "COMPETITION AMONG PEOPLE MAKES BETTER PRODUCTS."



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