FCC to companies: explain your zero-rating data exemptions
AT&T, Comcast and T-Mobile face FCC questions on free data.
One of the most unfortunate misnomers of The Cloud as a metaphor for describing an increasingly networked society is not only that it perpetuates a fiction of an intangible system—but also a fiction that everyone experiences that system in the same way. AT&T Inc., Comcast Corp. and T-Mobile US Inc. are facing questions from U.S. regulators about offering customers free data for viewing Web videos, a feature that raises concerns about equal treatment of Internet content.The Federal Communications Commission said on Thursday it was exploring whether new services from , T-Mobile USA and and AT&T violate net neutrality rules.FCC Chairman Tom Wheeler said the agency wants informal meetings with the carriers to stay aware of innovative services in the wake of the agency’s tough new net-neutrality regulations WASHINGTON — Federal regulators are looking into new offerings such as T-Mobile’s Binge On, which exempt video and other services from data caps, to determine whether they violate new rules for Internet traffic.
In letters sent on Wednesday, senior F.C.C. officials asked the companies to provide information about promotions that allow unlimited streaming of video from specific content providers. Wheeler said. “We want to ensure that we have all the facts to understand how these services relate to the commission’s goal of maintaining a free and open Internet while incentivizing innovation and investment from all sources,” the letters continue. The discussions come amid concerns that carriers are treating some data traffic differently, which may conflict with the fairness policies central to net neutrality rules. Those controversial rules, which took effect in June and are being challenged in court, bar Internet service providers from discriminating against legal content flowing through their networks.
Net neutrality advocates argue that these programs violate the commission’s rules, giving a distinct competitive advantage to the apps and services that they let customers use data free; upstarts, they argue, will always fails in comparison. Although cables are still the foundational backbone of the network, more and more U.S. connectivity happens wirelessly, across cell networks run by mobile carriers. Some consumer advocates and other critics have raised concerns about so-called zero-rating and sponsored-data plans, which exempt select content from counting against customer data limits. Most people see or experience little distinction between mobile Internet and the Internet accessed on a laptop or desktop computer—at the end of the day, it’s all just data. In several markets, Comcast is also testing what it calls usage-based pricing, or charging higher broadband prices to customers who go over a set monthly limit.
But at least as far as net-neutrality regulations went, for a long time the mobile, wireless Internet was an entirely different animal from the wired one. We remain committed to innovation without permission [from regulators] and hope the FCC is too.” T Mobile said its program does not violate open Internet rules. “This program provides both great customer choice and industry innovation that encourages competition and we believe it is absolutely in line with net neutrality rules,” the company said.
The company says the approach, which is similar to what is used by wireless companies, is aimed at a small percentage of its heaviest Internet users whose streaming videos and other Web activity take up a large amount of its broadband network. In a news conference on Thursday after the agency’s monthly meeting, Tom Wheeler, the chairman of the F.C.C., said the letters did not signal a formal investigation of the companies, nor were the letters sent as part of an enforcement action. Now being tested in a handful of markets, Stream TV allows the company’s Xfinity Internet customers to stream Comcast cable programming that doesn’t count against data caps. “Our Stream TV service does not go over the public Internet. The most recent changes to net-neutrality rules explicitly stated that mobile services should be covered under the same classification as wired broadband, given that “mobile broadband Internet access service is interconnected with the public switched network.” The FCC has given this reclassification teeth: In June, they fined AT&T $100 million for throttling users on unlimited data plans.
Dallas-based AT&T offers a sponsored data option allowing companies to pay customers’ wireless data charges while watching videos or viewing content on their phones and tablets. StreamTV from Comcast allows cable customers to watch online videos for free through its own new streaming service, but would count streaming on Netflix, for instance, toward monthly data limits. It is a cable service that only works in the customer’s home,” said Comcast spokeswoman Sena Fitzmaurice. “It is not a so-called ‘zero-rated’ service.” The meetings will be an “informal review of new offerings so the commission is fully informed about new marketplace offerings,” FCC spokeswoman Kim Hart said.
This is to help us stay informed as to what the practices are as we said we would do.” But presumably, if the FCC doesn’t like what it sees, it could turn into a deeper look at this business practice and a formal decision on in what — if any — circumstances it’s allowed. Already, Comcast’s new Stream service and T-Mobile’s new Binge On service offer customers streaming video that isn’t subject to data caps, where they apply. But in the months since the FCC issued the rule changes, several mobile carriers have begun introducing services that seem like blatant challenges to the entire premise of net neutrality. The companies also can discuss “their views on how the broadband industry as a whole is developing,” and the FCC “will invite others — including other commercial interests and public-interest groups — to meet with us as well,” Hart said. The agency’s two Republicans, who opposed the rules, complained Thursday that they had not been told of the letters and said Wheeler was on a “fishing expedition” for net-neutrality violations.
Some net neutrality supporters have said the FCC should investigate whether the offering would violate the agency’s open-Internet rule by unfairly favoring some video providers’ offerings. It’s unclear where zero rating as a concept first took hold, but it seems like a lot of it goes back to work by Facebook’s Internet.org initiative.
The logic presented to carriers offering these early zero-rated apps was essentially that by offering these “free” apps to users, they’d be enticed to pay for data later (which sort of ignores the fact that users of zero rated services are presumably already poor, but OK). Following criticism of the platform from net-neutrality advocates, the Free Basics platform now allows third-party developers to build apps for the platform, rather than curating it to selected Internet.org partners. Given the amount of criticism Internet.org received for their zero-rating schemes, it’s kind of surprising how unabashedly U.S. carriers have been rolling out and experimenting with similar plans. In 2014, Sprint offered an Unlimited My Way plan that offered users $12 per month data plans that offered limited data—but free data on either Facebook, Twitter, Instagram, or Pinterest.
More recently, T-Mobile debuted a new zero-rating service (known as the Binge On Plan, a name somehow equal parts bacchanalian and depressingly banal) which offers free streaming of services like Hulu, Netflix, and HBO Go, among others. There’s something stomach-twisting about T-Mobile offering free video streaming but charging for the date used when filling out an online job application. Binge On sounds like a marketing slogan out of Infinite Jest, but it’s not technically illegal for brands to emulate literary dystopias and for now, zero rating isn’t technically violating net-neutrality principles. That same Pew Research Center report that determined over two-thirds of Americans own smartphones also noted that around 15 percent of those Americans have limited access to high-speed broadband beyond their phone’s data plan, and 10 percent only had access to high-speed broadband via their smartphone.
This isn’t to say that it necessarily is realistic or makes sense to return to the halcyon days of genuinely unlimited, unthrottled data plans for all. Even if all our telecommunications infrastructure runs on renewable energy and is made from perfectly cradle-to-cradle manufactured hardware, it will still have a cost.
In a weird way, data caps are among the few ways of reminding people that there are material constraints on technologies that have been sold to them as infinite and limitless. But zero-rating for streaming services doesn’t make the material limitations of data use manifest; it makes them someone else’s problem and it makes access to online audiences a pay-to-play game.
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