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FCC Asks Comcast, T-Mobile and AT&T If Their Data Plans Violate Net Neutrality

"Zero rating" is now in the agency's crosshairs.

by Sam Gustin
Dec 18 2015, 10:00am

Photo: Kārlis Dambrāns/Flickr

Federal regulators want answers from some of the nation's largest internet service providers about a controversial practice called "zero rating" that critics say could violate US net neutrality rules.

The Federal Communications Commission has sent letters to Comcast, AT&T, and T-Mobile asking for information about monthly plans that exempt certain types of services from data caps.

Open internet advocates say such conduct is anti-competitive, and now the FCC wants more information from the companies in order to determine if they are violating the agency's net neutrality rules by favoring certain types of services over others. The FCC letters ask the companies to "make available relevant technical and business personnel" by January 15.

The FCC's landmark open internet rules, which protect net neutrality, prohibit broadband companies from discriminating against rival content or services. The controversy over zero rating is further evidence that net neutrality continues to be a flashpoint between broadband giants, federal regulators, and open internet advocates.

Comcast, in particular, has faced criticism over its practice of exempting its "Stream TV" in-home streaming service from its monthly data cap—while counting rival services against the cap.

"As you may be aware, concerns about the manner in which Comcast offers this service have been expressed," Roger Sherman, chief of the FCC's Wireline Telecommunications Bureau, wrote in a letter to the broadband giant. "For example, the CEO of Sling TV has suggested Comcast data usage allowances and the inapplicability of those usage allowances to the Stream TV raises 'level playing field' concerns."

A Comcast spokesperson told Motherboard via email that the company looks forward to participating in the FCC's fact-gathering effort. "Our Stream TV service does not go over the public internet—it is a cable service that only works in the customer's home. It is not a so-called 'zero-rated' service. We are happy to cooperate with this request."

Harold Feld, senior vice president at DC-based advocacy group Public Knowledge, said in a statement that the FCC has received "over 13,000 consumer complaints alleging Comcast has used its caps to 'punish' cord-cutters and falsely claim overages for customers that stream rival services."

"Given Comcast's lengthy history of anti-competitive conduct, and the recent flood of consumer complaints, the FCC's letter to Comcast is not only long-overdue, but mild to the extreme," Feld added.

AT&T, meanwhile, offers a "sponsored data plan" in which content providers subsidize wireless data usage by allowing customers to access certain services that don't count against monthly data limits.

In the letter to AT&T, Sherman wrote that the FCC wants "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."

An AT&T spokesperson told Motherboard via email that the company is reviewing the letter and will respond as appropriate. "We remain committed to innovation without permission and hope the FCC is too," the spokesperson added.

T-Mobile has been exploring similar business models, and has introduced a new "Binge On" policy that exempts certain video services like Netflix from data caps, while counting others against the monthly limits. Some open internet advocates have suggested that T-Mobile's plan violates net neutrality.

"We continue to be strong supporters of net neutrality and firmly believe in the principles of equal access to an open and free-flowing internet," a T-Mobile spokesperson said in an emailed statement defending the Binge On program. "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 FCC's net neutrality policy is currently being contested in a high-stakes legal battle playing out in the US Court of Appeals for the DC Circuit. A decision on that case, which could have major ramifications for the FCC's authority to crack down on "zero rating," is expected early next year.