I don't think there is any loss of significant future opportunity. When someone will be able to afford the Internet, they will start using whichever service they find fit. Till then for those people, I can't overstate how important free access to even this limited Internet is. Even free access to wikipedia and facebook helps a lot of people in a lot of ways. Fun Story: One day I was with the brother of a friend of mine. He said facebook helped him a lot in SSC preparations. I thought he was joking, but it turns out that there is an entire ecosystem of services on facebook which help several people in several ways and for those people, this free access matters a hell lot.

What about the third and fourth and fifth alternatives that are never talked about? Why must India choose between Free Basics or nothing?

You are assuming that the other services can just wait it out while people break out of FB ecosystem and discover them. Development of these kind of walled gardens significantly harm the development of independent services. That is one of the main problem. If everyone had free Orkut and no access to FB, how long would it have taken Facebook to catch on?

I am not assuming anything. People who don't have internt access are not using those service anyways. So those services will continue at their natural pace. So I don't see how free basics will harm the development of independent services. Regarding Orkut, it had a lot of users before facebook arrived on the scene. But Facebook was just so much better that everyone eventually jumped on it. I doubt the outcome would have been any different had Orkut been free, considering that the network effect was a huge price in itself. The point is, I am yet to see anyone who can afford a monthly data pack interested in choosing a service based upon it's inclusion in free basics. Free basics is good for those who won't use the internet at all otherwise.

In the FB vs Orkut example, not only is the Orkut Free, FB is inaccessible to Orkut users. What do you think will be the outcome then?

You are also assuming that if not for Free Basics, there will be nothing done to increase the internet spread in India. As those opposed to Free Basics have repeatedly pointed out, there are other better options available.

Facebook could make all this opposition evaporate by changing from a fixed service model to a fixed bandwidth model open to all services. I'm not trying to keep people from getting their first access to the Internet, I'm trying to keep corporations from creating a permanent tier of second-class locked-in customers.