​Flipkart's Bansals eat humble pie, withdraw from Airtel Zero

An avalanche of criticism caused Flipkart to withdraw from Airtel Zero. Will there be other casualties?
Written by Rajiv Rao, Contributing Writer

On Tuesday, I wrote this piece on how India's largest telecommunications operator Bharti Airtel's new marketing plan Zero has created a hornet's nest for itself with a wide range of Indian society, with everyone from consumers to politicians accusing it of violating net neutrality.

Mukesh (L) and Sachin (R) Bansal (unrelated), co-founders of Flipkart

Yet, the one company that seemed unfazed by it all was yesterday's minnow and today's e-commerce behemoth Flipkart, which was rumored to be one of the first to jump into bed with Airtel.

As I described yesterday, Zero is a newly minted plan that allows "partner websites" to get promoted exclusively by the telco through its broadband service and website. In essence, partners end up shelling out cash to be promoted, while subsidizing the end users of the service, basically rendering their surfing cost free. Subsequently, the country witnessed an outpouring of opinions from consumers and politicians who feared that Airtel was in gross violation of net neutrality.

It may be entirely logical to defend your partner, but when both of you happen to be market share leaders in a small pond (oligopoly anyone?), things can take an ugly turn. When the avalanche of criticisms of Zero began to emerge, Sachin Bansal, co-founder of Flipkart, which had already purportedly teamed up with Airtel, lashed out:

"When foreign companies do it in India - Innovation. Indians do it - Violation," said one of his tweets. "I'm for #NetNeutrality. I spend time/money helping startups in india. Will never support things which suffocate innovation..." said another. "0 rated apps for limited time doesnt go against #NetNeutrality. Costs/competition are very high. Can't be sustained for long..." explained a third.

That basically did it for both Flipkart fans and regular netizens, who became even more enraged by the Bansal tweets. "Have shifted to amazon and Snapdeal cause of your arrogance. ... ciao.." (sic) said one response. "Can u clear your stand? If u support #NetNeutrality , y do u want n/w operators to provide special privileges to some?" (sic) asked another tweet.

Having now successfully, along with Airtel, stoked a raging national debate on net neutrality, Flipkart and the Bansals (both co-founders share the same last name) were forced to eat humble pie and withdraw Flipkart from Zero yesterday -- an almost unheard of incident in India until now.

Mukesh Bansal, the other Bansal, co-founder, and head of Commerce Platform, made the following statement: "We looked into zero-rating program deeply, and we felt that in the long term, it can lead to violation of the spirit of net neutrality," he admitted. "As a company, we very deeply believe in the principles of net neutrality. That [net neutrality] is one of the big reasons why e-commerce has grown in the country as much as it has, though it has a long way to go."

Not surprisingly, there's been no more tweeting by the other Bansal since his earlier salvo.

Still, it is unlikely that a behemoth like Flipkart will suffer any major long-term consequences (humans seem to have acutely short-term memories when it comes to availing of tantalizingly steep discounts and fire sales).

But for now, score this battle as Netizens: One; Flipkart-Airtel: Zero.

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