NEW DELHI --Flipkart, India's largest online retailer, has shelved controversial plans to offer free access to its mobile app under a deal with Bharti Airtel.
The decision comes at a time when Internet neutrality is being hotly debated in India; critics attacked Flipkart on social media saying the proposed deal would give it an unfair advantage.
Flipkart said on Tuesday that it is "walking away from the ongoing discussions" concerning the Airtel Zero platform which allows mobile phone users to access certain apps without data charges.
"We will be committing ourselves to the larger cause of net neutrality in India," Flipkart said in a statement.
Before backing off, Flipkart Chief Executive Officer Sachin Bansal had been in favor of free data service plans which he said reduced costs for users.
"Fears of a telecom big brother emerging are unfounded," he tweeted on Apr. 8, adding that zero-rate apps for limited periods do not violate net neutrality.
"I spend time, money helping start-ups in India," Bansal tweeted, adding that he would never support "things which suffocate innovation".
Airtel said that Airtel Zero was open to all content providers "on a completely non-discriminatory basis", and that there had been some misconceptions. It was not a tariff proposition but an "open marketing platform", Airtel said.
The Flipkart-Airtel episode comes as the Telecom Regulatory Authority of India (TRAI) was barraged with emails after seeking public opinion on whether telecom companies should be allowed to charge different rates for different Internet data uses, such as browsing or messaging with apps like WhatsApp and Viber.
According to Sanchit Vir Gogia, chief executive officer of Greyhound Research, an information technology analysis company, differential pricing by telecom companies and Internet service providers (ISPs) will hurt India's emerging digital economy.
"All consumers of web-based services will become entirely dependent on their Internet service provider for access to basic web-based apps that were earlier free," he told the Nikkei Asian Review.
Gogia said net neutrality means ISPs and the spectrums they use should continue to be regarded as public utilities and resources all can access.
"Accepting this principle would mean that ISPs will not control or block any web-sites or web-based service providers," he said.
"Our government believes in using Internet for citizen empowerment," said IT and Telecom Minister Ravi Shankar Prasad. His ministry has set up a panel on net neutrality that will submit a report in the second week of May.