Observacom
Análisis - Brasil

Internet concentration and the challenges related to guaranteeing rights

Helena Martins*/ Brazil, april 2016

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Since the 1970s, information technology has become necessary to integrate production plants spread throughout the world and to make possible the expansion of financing, for which purpose information highways are essential. In general, this development is also linked to the search for capital to expand less commodified areas, such as culture.

It is true that technology development has been accompanied by an attempt to build a more interactive and decentralized world. However, what we can see is the rationale of concentration verified in other media systems, but now dressed in new clothes, which from our understanding means the expansion of conglomerates in the area of communications.

It is estimated that the North American company Level 3 Communications controls 70% of high-volume internet traffic worldwide, either through its own infrastructure or alliances with third parties. In the United States, five companies are responsible for 70% of the revenue generated in the digital world, including Amazon, Alphabet (the new parent company of Google) and Facebook. Google and Apple practically form a duopoly in terms of mobile phone applications, made viable by multi-million dollar contracts that guarantee the availability of their products in mobile appliances.

Google also dominates Internet search engines, which has triggered discussions as to how the company uses its market power. Since 2010, the European Commission has accused the company of abusing its dominant position and for adopting anti-competitive practices through advertisements linked to electronic commerce. More recently, the cross referencing of user data between YouTube, Google and others has drawn the attention of European authorities.

The issue of concentration is also prevalent when referring to broadband access. The service exists in an already concentrated telecommunications structure. The historical monopoly of the sector; the need for large amounts of capital in order to access this market, and the absence of public policies to stimulate competition and pluralism are just some of the factors that explain this situation. In addition, communication is treated as a business and not as a right.

In Brazil, Vivo, Claro, TIM, OI and SKY all compete to supply Internet access through both fixed and mobile networks. All are controlled by transnational groups. As a result, Brazilians pay one of the highest prices in the world for access to broadband, while the majority of municipalities have precarious access to this service.

Given that these companies are not interested in the entire country, we now have real technological deserts, which extends inter- and intra- regional inequality. And while the proportion of households with Internet access is 54% in urban areas, it is a mere 22% in rural zones. In the south-east region, 60 out of every 100 municipalities have access, but in the north the figure is just 35, according to the ICT Household investigation in 2014.

Quality of access is another problem, which is reinforced by public policies that do not work with the idea of universality, but with the paradigm of mass access to mobile phones. It is worth reminding the reader that differences in the quality of access and use increasingly reinforce other social inequalities.

The challenge of ensuring universal access to broadband can only be met when consideration is given to Internet access as a basic service. That should mean greater State regulation, and the adoption of policies and public subsidies to reverse the condescending obligations of companies so that in fact every citizen has that right guaranteed.

That was the understanding adopted by countries that successfully achieved universality, as shown by research conducted by Intervozes in 2012. In Finland, France, South Korea and Japan, among others, access to broadband was accompanied by the State acting as a driving agent. In general, regulations, open access and promotion policies were adopted through, for example, financial aid programs. The Uruguayan case should also be highlighted. Universality was fostered by the State itself and the supply of access has been accompanied by major policies related to media education.

What we have in Brazil and other southern hemisphere countries is the attempt to transfer that obligation to special interest groups such as Facebook itself. The biggest example of this is the Internet.org project, which is linked up across 15 countries. Through this initiative, companies attempt to provide “Internet” to the unconnected population without applying connection charges or by providing discounts on data packets, access to a range of applications and pages selected by Facebook itself. As a result, the company will generate more privileged information regarding users, which may subsidize the production of personalized advertising. The initial name of the initiative leaves no doubt about another major objective: to blur the distinction between Internet and Facebook.

Internet.org is currently one of the greatest threats to net neutrality and may represent extensive control of information flows, violating net neutrality by restricting access to specific applications. It also violates the freedom of choice by the consumer, given that Facebook itself defines the connection provider and access to applications, which represents an anticompetitive advantage as this favors select companies, thus compromising innovation.

Other violations of net neutrality have already been verified by the practice of zero-rating or access supported by certain applications, content and services. It is common today to find alliances between telecommunications operators and Twitter, Facebook or Whatsapp so that these networks remain accessible even after all of a person’s account balance or data service payments have expired.

Zero rating damages neutrality, as it does not treat different content equally from the moment payment of data packets has expired, which is generally minimal. In practice, the whole universe of content available online is blocked, apart from the commercial partners of the operator. That strengthens an anti-competitive rationale and hurts the principles governing the Civil Framework of Internet. If we consider, as stated by the law, that access to Internet access is a right, not even the interruption of services should be permitted, as this is basically an essential and universal public interest service.

This is a controversial issue and is now under discussion, as we debate the regulation of the Civil Framework for Internet in Brazil. The law indicates that neutrality can be made relative depending on technical requirements. Zero-rating, as pointed out, does not fit into such exceptional circumstances. However, in the proposed regulation presented to society, the Brazilian government has remained silent on this issue and is even increasing the possible exceptions for neutrality. That presents a barrier to ensuring that this fundamental principle is upheld. The guarantee of other rights not addressed in this article depend on it, such as the right to privacy, which is viewed as central to contemporary society, whether because of the petitions of the market or actions taken by the State to control how we live.

* Member of the Board of Intervozes and doctoral student in social communication at Universidad de Brasília (UnB).