What's wrong with this? They're not preventing you from paying for Internet access, they're offering some access for free. People in India are free to start competing ISPs.
Yes there is a market for ISP access and consumers are free to chose another. That's fair. Nobody is arguing this is illegal, it not even necessarily immoral for the people that made the deal. It's just business and companies give away freebies all the time for all sorts of reasons. The problem comes if this becomes standard practice, because at that point you don't have an open market anymore, you have an industry cartel that has stitched up the market to divide it up between themselves. See Adam Smith for why this is bad and why, in order to operate equitably and in the public interest, markets need to be regulated in order to remain free.
How so? Anybody is free to start an ISP that doesn't do this. The existence of this ISP does not prevent anyone from starting their own. There is absolutely a free market in ISPs, and the only thing that would prevent a competing ISP is the government (by denying a license) - not Reliance Communications Ltd
> They have managed to skew the market in their favour by artificially lowering the overall cost of using their services and artificially raising the cost of connecting to competing services.
There's nothing artificial about it. McDonald's selling a burger for $1 doesn't prevent anyone from selling burgers at that price or a lower price. If McDonald's gives burgers away for free, that does not prevent anyone else from doing the same.
> You can't have your free market cake on one end of the argument and eat it on the other.
I'm not sure what you mean by free market as you use the term. The fact that its hard to compete against McDonalds (or Reliance Communications) doesn't mean others aren't free to compete.
> you have an industry cartel that has stitched up the market to divide it up between themselves.
Yet other investors and entrepreneurs are free to eat their lunch... unless gasp consumers actually like what they're being offered more than the alternatives you're personally interested in.
Another issue is what is given for free. If free access is given to something that is 80% of what they need, people will have reduced incentive to buy 100%, shrinking the market for the 100% solution, raising its price, and keeping it out of reach of most people. As an analogy, giving people free low quality food could discourage them from high quality food, and the lack of market for good food could drive up its price further.
Internet.org is not about giving things away for free, it's about a cartel using their combined market power to negotiate subsidies and fix prices in order to distort the market.
And of course OpenOffice should be made illegal under that same logic.
If you are implying that serious investment is required to setup the infrastructure, you are correct. This is the nature of the telecom game.
But a HN post showed a way to tunnel normal traffic through FB chat[].