Indian entrepreneurs won’t back Facebook’s Free Basics – even if they can make more money

Indian entrepreneurs won’t back Facebook’s Free Basics – even if they can make more money
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Indian internet startups – even those who could potentially benefit from Facebook’s Free Basics – are opposing the service in support of a “fair ecosystem.”

In November, Bengaluru-based jobs portal (earlier called was approached by Facebook to become a part of Free Basics. This partnership would have helped the three-year-old startup make its presence felt in smaller cities and compete with established players like But the founders were “not comfortable with the idea” and decided to give it a miss, Abhijit Khasnis, its co-founder and chief operating officer, told Quartz.

Quartz spoke to five other entrepreneurs who had turned down Facebook’s requests to register on Free Basics.

Facebook’s Free Basics initiative aims to provide free but limited internet access in the developing world, to help bring the next billion online. In India, Free Basics makes certain services and websites available to subscribers of Reliance Communications. Net neutrality activists say Free Basics violates the open nature of the web, and first-time internet users who use this platform will have access only to services that are approved by Facebook.

Vijay Shekhar Sharma, founder and CEO of Paytm, felt “choked” during his recent trip to China because of the country’s protectionist internet policies. “Twitter and Facebook were blocked in China and I had to create a Microsoft account to send emails and tell everyone to forward important emails to me on that new ID,” Sharma told Quartz. “Facebook cribs about China’s firewall, how can they be part of something that splits the internet in India?”

Paytm was a part of Facebook’s initiative earlier but pulled out in April, along with other players including the Times Group, NDTV, and NewsHunt. Around the same time, India’s largest e-commerce portal, Flipkart, also withdrew from Bharti Airtel’s differential pricing platform, Airtel Zero.

“God is kind that we are among the lucky ones who can be a part of such an initiative. But what if we were not? We exist today because when we started the internet in India was neutral and free. How can we support something that kills the neutrality of the internet now?” Sharma told Quartz.

Facebook response

On Dec. 23, Reliance Communications put Free Basics on hold. “As directed by TRAI (Telecom Regulatory Authority of India), the commercial launch of Free Basics has been kept in abeyance, till they consider all details and convey a specific approval,” a Reliance Communications spokesperson told the Indian Express newspaper.

Facebook, however, said it is continuing to push for Free Basics in the country. “We are committed to Free Basics and to working with Reliance and the relevant authorities to help people in India get connected,” a Facebook spokesperson told Quartz.

TRAI’s directive comes just days after Facebook launched its “Save Free Basics” campaign asking users to respond to a discussion paper by TRAI, which has sought comments on differential pricing practices such as Free Basics or Airtel Zero.

Facebook’s campaign has been called “misleading” by some. Amod Malviya, a former chief technology officer of Flipkart, is among those who have condemned Facebook’s recent Save Free Basics campaign.

The social media giant is equating digital equality with Free Basics and discrediting the critics of the initiative just to get people to support it, he wrote in a post on Medium. “Instead of addressing the TRAI’s questions, it goes about a modern twist to what essentially used to be the white man’s burden – that India’s poor need Facebook’s FreeBasics to free them,” he argued.

India is projected to have 426 million users online by June 2016, making it the second biggest market in the world. But the internet penetration in the country of 1.2 billion is still less than 20%.

While it is critical for online business owners to figure out how to reach the next million users in India, many believe that zero-rated services such as Free Basics may cause more harm than good. Instead, the government should think outside the box and increase penetration.

“The government can refund the data usage through payment wallets or other such services that are easily available today. That’s how the government subsidises for gas and other things. Why do you need to bring in companies to split the internet to attract more people to use it?” Paytm’s Sharma said.

The other side

However, there are some entrepreneurs who have declined to partner with zero-rated platforms for now, but still see merit in the concept.

“I am fine with a zero-rated app as long as nobody is monetising from it,” Amit Jain, co-founder and CEO of auto portal, told Quartz. “I believe that informative and educational apps must be made free for those who cannot afford the internet, but including apps that make money into this would be unfair.”

And, despite some vociferous critics with the startup community, there are more than 80 apps available on Free Basics., an eight-year-old marketplace for grey collar jobs, was among the launch partners for Free Basics in India. The company continues to support the initiative.

“Net neutrality is important, but we believe that for a country that is struggling to get people online, a service like Free Basics can be of great help,” Vir Kashyap, co-founder and chief operating officer, told Quartz. “Is the internet in its current form neutral? There are some companies, like Google, that are already exerting huge influence on the internet.”