Flipkart’s See-Saw Move

The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Hardik Kharbanda, MBA 2014-16, Vinod Gupta School of Management, IIT Kharagpur

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Flipkart announced its withdrawal from the deal with Airtel to join the Airtel Zero Platform to show its support for Net Neutrality as per Indian Express article dated 15 April 2015. It comes 10 days after it was reported that Flipkart is in talks with Airtel to join Airtel Zero. It is a damage control action taken by them as a result of massive protests by users which included deletion of Flipkart Apps, downgrading of app ratings and poor rating of products on Flipkart store.

It is surprising to see that it went into such a deal in the first place. The consequences of Telecom companies’ request for differential pricing of data are gruesome for all start-ups and not for the users alone. Implementation of such pricing would mean that cash rich companies will be able to provide better connectivity to users to sell their products thereby quashing the cash crunched companies, especially new start-ups. It also means that the rich will become richer and poor poorer. As per the article, TRAI has received over three lakh e-mails from internet users to express their concerns over net neutrality.

Flipkart started as small web store that sold books and grew to be an online megastore in just 8 years. However, they should have realised that would never have been able to achieve this had such a situation existed then. Incidentally they are drawing flak from social media activists even now stating that the withdrawal is just a marketing gimmick and being compared to the big billion sale failure.

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