With the 5G rollout already happening, serious policy consideration of allied regulatory issues is no longer an ‘if’ but a ‘when’. Although countries like the US and South Korea have successfully implemented 5G rollouts on smaller scales, issues specific to the Indian subcontinent will be unique and need special consideration.

On one hand, we have issues surrounding the standard setting process. India has adopted the TSDSI RIT standards as opposed to the globally adopted 3rd Generation Partnership Project (3GPP) standards. While TSDSI seems more suitable for the Indian scenario given India’s huge rural community, its adoption also means that comparative studies of the 5G regulation will be more difficult. On the other hand, we have issues surrounding the pricing and allocation of spectra. While the telecom giants like Airtel and Jio have been protesting (see here and here) against the high spectrum fee, it is yet to be seen who bears the high setup cost of 5G infrastructure in India. In this post, however, we shall be discussing neither of these issues. Instead, we shall focus on the access issues that are about to arise once 5G has been rolled out.

The euphoria called 5G

The whole of the telecom industry is euphoric about the 5G rollout and the futuristic opportunities it might bring with it. In anticipation, telecom giants are already entering into strategic alliances to reap the benefits of the 5G rollout. Bharti Airtel and Tech Mahindra, for example, have come together in a partnership where Airtel demonstrates and tests 5G and Tech Mahindra builds 5G applications and platforms. Jio is already in talks with Samsung for a technology partnership over 5G. Vodafone Idea has already announced a 5G partnership with Ciena, a US-based company.

The euphoria of these telecom giants is well-justified. 5G brings with it a number of enhanced capabilities that promise to widen the possibilities of the 5G network as a platform. 5G promises enhanced mobile broadband (eMBB), ultra-reliability and low latency (uRLL), massive machine-type comms (mMTC), and network slicing inter alia which opens up numerous possibilities for VR, AR, and IoE/IoT applications. While the previous networks like 3G and 4G primarily involved B2C transactions, 5G opens up possibilities for multiple B2B transactions.

Ensuring access: Antitrust vis-a-vis Net Neutrality

Amid all these B2B opportunities, there exist certain issues that will be needing regulatory intervention every once in a while. One of such issues is ‘access to the network’. With 5G networks undertaking critical functions such as healthcare and agri-assist, access to the network will be a necessary prerequisite for a free and fair marketplace. Also, such access will become even more indispensable once 5G networks start supporting smart cities. Once 5G becomes ubiquitous, regulating ‘access’ to the network will become a key consideration in deciding how the cost of staying connected gets allocated.

Fortunately, we, in India, happen to have at least two regulatory mechanisms that can intervene to ensure such access - two otherwise distant regulatory regimes that happen to share uncanny similarities when taken a closer look. For one, we have the Competition Commission of India (CCI) which is entrusted with promoting fair trade by regulating instances of market power and abuse thereof, inter alia. On the other hand, we have the Telecom Regulatory Authority of India (TRAI) which has the subject matter jurisdiction to regulate the telecom industry in India. In July 2018, the Department of Telecommunications made rules favoring Net Neutrality (which were claimed by BBC to be the world’s strongest!) which can be a keystone in ensuring access to networks. And so are the Competition Act of 2002 and allied rules. 

Prima facie, it may be difficult to grasp the common grounds between antitrust law and net neutrality principles. However, looking at the historical background against which the net neutrality principles were developed, it is easy to draw the connections. Starting from the Common Carrier principle in 2003 when net neutrality was summarised as “a structural requirement that would prevent broadband operators from bundling broadband service with Internet access from in-house Internet service providers” (source), net neutrality has always been focused on preventing abuse of market power. Net neutrality revolves around the notion of ‘indiscriminate routing of network traffic irrespective of the data type’, and this has helped keep the internet an ‘equal platform’ that protects innovations and preserves openness. It is this openness that has made the internet flourish.

The two foundational principles of net neutrality, namely ‘transparency’ and ‘no discriminatory blocking/unreasonable restrictions’, can be directly mapped onto corresponding antitrust provisions. Antitrust also requires transparency and disclosure to avoid information asymmetry and is very alert to flag discriminatory restrictions that may create market entry barriers. With the advent of 5G networks and allied access issues, it is pertinent to note that the responsibility to ensure equitable access will be both on the CCI as well as the TRAI. Is that good news? Or bad news?

Over-regulation vs. Under-regulation

In most worldly affairs, the more the merrier. However, that is not the case with regulation. Nor with jurisdiction.

When we have more than one regulator for any given set of problems, it often results in either over-regulation or under-regulation. Over-regulation kills the competitive spirit in the market. Also, it may lead to too much interference with the market forces which can lead us to a market failure. Under-regulation, on the other hand, leaves the market forces to themselves, which often leads to the accumulation of market power and abuse thereof. Under-regulation, just like over-regulation, runs the risk of an inevitable market failure.

In the recent past, we have seen multiple instances of under-regulation where the subject matter concerned multiple regulators. The most pertinent example would be the case of consumer privacy on digital platforms/spaces. On the face of it, it was for the privacy officials to be concerned therewith. However, as multiple competition authorities have admitted lately, it was also a competition concern that needed regulation by the competition authorities. The consequential under-regulation that involved competition authorities shifting the responsibility to privacy officials (see In Re Vinod Kumar Gupta and WhatsApp) and vice versa is a classic example of how ‘the more is not the merrier’ when it comes to regulation.

Instances of over-regulation and resultant disputes are rampant, too. CCI has had a long history of conflicts with other sectoral regulators including the TRAI and RBI. The Supreme Court judgment in Competition Commission of India v. Bharti Airtel doesn’t seem too clear, either, to put these conflicts to rest.

Regulatory Convergence: The way forward?

Multiplicity of regulators is not a new challenge by any count. The Financial Sector Legislative Reforms Commission’s Report pointed this out way back in 2013. However, this old challenge will have to have a new, or at least innovative, solution. With the IT and Telecom sectors booming at an unprecedented rate, it’ll be disastrous to leave them under-regulated.

The regulatory tussle that we might witness is not going to be unique to India. For example, the United Kingdom’s concurrency model might look good in theory but has very little evidence to speak for itself. Other countries across the globe are either already facing such a challenge, or are bound to face it soon. Amid all this regulatory chaos, maybe it is time for a new regulatory theory - one that attempts at regulatory convergence.