AT&T: Broadband Usage Caps Are Awesome, And Preventing Us From Abusing Them Is A Horrible Injustice

from the absolutely-nothing-we-say-is-true dept

While AT&T is now a part of two lawsuits to try and overturn the FCC’s new net neutrality rules, there’s probably no company singularly more responsible for the rules being necessary in the first place. It was AT&T that really got the neutrality debate rolling in the States just about a decade ago, when then CEO Ed Whitacre proudly proclaimed he was going to start charging companies like Google a “troll toll” just for touching his network.

AT&T’s been on the bleeding edge of exploring creative new ways to violate net neutrality for an extra buck ever since, whether that’s blocking video services to drive users to pricier plans, using throttling to drive users to costlier plans, using interconnection to sock content companies with extra costs, or using zero rating to generate new revenue at the cost of a steeply tilted playing field.

Telco CEO Randal Stephenson has been making the media rounds lately proudly proclaiming that AT&T will surely be victorious in court, and the the FCC’s net neutrality rules will be vacated. But AT&T lawyers are working hard to prevent regulators from including conditions on its $49 billion acquisition of DirecTV related to neutrality as well. Despite countless instances where AT&T has used usage caps to unfair advantage, AT&T’s telling regulators there’s no need for neutrality conditions on the merger (with a specific eye on usage caps and zero rating some services) because history shows AT&T is a saint on that front:

“The record does not support Opponents? request that AT&T be barred from exempting any online video service from any usage-based tracking, metering, or billing in its broadband services,” AT&T wrote. “Opponents offer no reason for the Commission to reverse these very recent conclusions and issue a blanket, abstract prohibition that would apply only to AT&T. Doing so would deprive AT&T customers of service offerings tailored to fit their usage and their budget. It would also distort competition by hindering AT&T?s efforts to close the gap and compete with cable?s higher-speed broadband products.”

In other words, the company is claiming that merger conditions preventing it from using usage caps uncompetitively — something it usually only does in uncompetitive markets — will hurt competition. AT&T logic! It’s also trying to argue that ten years of AT&T’s clear intent to do harm on this front is a mass hallucination. AT&T already imposes usage caps on its broadband customers (150 GB for DSL users, 250 GB for U-Verse fiber to the node customers) thanks to this lack of competition. Yet hysterically AT&T insists there’s no way it could possibly impose aggressive caps because customers would leave AT&T:

“AT&T wrote that its broadband data limits are high enough to “accommodate the great majority of customers.” Broadband providers with caps “that significantly impinge on the ability of customers to enjoy OVD [online video distribution] products will not be able to attract new customers or even to retain existing ones,” AT&T wrote.”

Here’s the truly entertaining bit though: as we’ve noted before, AT&T has no interest in retaining most of these capped DSL users anyway. It’s willfully trying to drive them away with rate hikes so it can disconnect them and focus on even more expensive and heavily capped wireless LTE service. It’s also worth noting that AT&T’s not currently enforcing those 250 GB caps on U-Verse users, because the markets it has upgraded with better service usually see improved competition. In short, AT&T caps markets that lack competition, and doesn’t in markets where there’s at least a little. Yet AT&T’s telling the FCC that restricting their ability to impose what are entirely arbitrary caps that have nothing to do with network congestion — would hurt its ability to compete.

Of course as we’ve long noted, net neutrality is a symptom of a lack of competition, and net neutrality rules are only necessary because companies like AT&T are endlessly exploring new ways to abuse this lack of competition. However, while the FCC’s neutrality rules do allow users to complain about usage caps and zero rating, they’re not explicitly included in the rules, and so far the FCC’s given every indication that they see caps as just “creative pricing.” While there have been hints the FCC might start policing caps (and unreliable usage meters) should they start getting notably more ugly, it’s pretty far from certain as the agency appears to want to steer clear of broadband price controls.

Still, AT&T’s working tirelessly on multiple fronts to ensure nobody infringes on its god-given right to use usage caps to abuse uncompetitive markets suffocated by regulatory capture. That was an honor bestowed upon the company after a generation of blood, sweat, tears and millions in campaign contributions, and it will be damned if it’s going to have said rights trampled by those new startup and consumer-friendly goody two shoes over at the FCC.

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Comments on “AT&T: Broadband Usage Caps Are Awesome, And Preventing Us From Abusing Them Is A Horrible Injustice”

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DannyB (profile) says:

AT&T is truly visionary

Less visionary dinosaurs should adopt AT&T’s ingenious model.

For example, the US Post office. If I exchange postal correspondence with certain addresses, the cost should be substantially higher. But incoming junk mail should be zero rated and not count against my monthly US Postal mailing limit.

If I need to send or receive more snail mail each month, then the US Post Office could offer a higher priced tier that allows exchanging more pieces of snail mail.

Electricity companies should similarly follow AT&T’s lead. If I exceed my monthly killowatt-hour usage, I can move into a pricier plan. Certain uses could be zero-rated. For example if the electric utility can strike a deal with Maytag, then, use of Maytag washing machines and dishwashers could be zero-rated and not count against my monthly killowatt-hour usage. Or I could move to a higher priced plan.

Similarly, the water company . . .

Similarly, the natural gas company . . .

Thank you AT&T for getting it right. Nobody should have to suffer with a plan that simply charges a fair price by the bandwidth consumed without regard to how that bandwidth is used, or where it is connecting to.

DannyB (profile) says:

Re: Re: AT&T is truly visionary

Actually the power companies could make a very similar argument to what Verizon was with Netflix.

Certain types of appliances put a much heavier load on the electric utility grid than light bulbs do.

Therefore, makers of those large energy consuming appliances should have to pay electric utilities an ‘interconnect fee’ to wire such heavy loads to the incoming utility service. Just as Netflix should pay Verizon for the amount of bandwidth that netflix uses.

That argument makes sense for the electric utilities to make. Verizon has already set the precedent.

And I think the water and natural gas utilities should take note.

Anonymous Coward says:

Adrian Lopez

Usage caps don’t become a net neutrality issue until the ISP begins exempting certain packets. Even so, caps can certainly be used anti-competitively (a cable provider capping broadband to boost its regular cable service) or deceptively (caps not clearly and prominently stated, or enforced inconsistently).

Adrian Lopez says:

You can't support both zero rating and net neutrality

Zero rating = zero net neutrality.

If users being able to enjoy your service as intended means having to pay ISPs for the privilege, you have no net neutrality to speak of. Sure, under FCC rules services like Netflix won’t have to pay for a fast lane, but they *will* have to pay to remove any roadblocks. Refuse to pay and your customers won’t be able to use your service as they would if you did.

jimb (profile) says:

AT&T competition...

“AT&T insists there’s no way it could possibly impose aggressive caps because customers would leave AT&T”. They’re right, of course. I have the Uverse and while I haven’t hit the 250GB cap, I am just hanging on waiting for Google Fiber to come, then I will be out of AT&T as fast as I can. Sure, I could go to the ‘competition’ right now… unfortunately ‘the competition’ is Comcast – need I say more?

That One Guy (profile) says:

A prohibition against punching people only affects those who plan on doing so

The funny and/or aggravating thing about arguments like that, the ‘There’s no need to add Condition/Clause X because we’d never do that’ is how easily it is to blow the argument clean out of the water(with the aggravating part being how no-one ever seems to realize it).

If the company/agency in question really has no plans on doing the action that would lead to punishment if the condition/clause was added, then they have absolutely nothing to worry about, as the condition/clause will never affect them. It’s only if they do in fact plan on engaging in the behavior that the condition/clause prohibits that they have to worry about the penalties associated with it.

Basically, by even making the argument that no such clause or condition is needed, because they would never do whatever it is that is prohibited, they have shown both that it is needed, and that they do plan on engaging in the prohibited activity.

Joe V says:

I have AT&T DSL here in California and have been since 2008. For the most part, their service has performed quite well and nearly trouble free with a tech coming out only once to repair a faulty line, or I have called tech support to report an outage.
However, I am not happy paying an outrageous fee for substandard service when cable companies are pushing higher speeds and fiber is coming to many areas around the country.
I’m supposed to a get 6megs-in reality its 4.8 or slower depending on time of day-plus a 150 gigabyte monthly cap and overage charges of $10 for ever 50 gigs I go over. My internet bill is supposed to be about $40 a month. On average it is $71.00. This month of August 2015 is $84.00.
AT&T justifies these bandwidth cap and overage charges as needed because of a small few that are using the service “too much”.
I am a cord cutter. I stream my TV using HBO Now, Showtime, HULU, Amazon Prime, Netflix, and sling TV. I am also a gamer. ISPs such as AT&T, Comcast, Cox, Suddenlink, CenturyLink, Windstream and Time Warner are engaged in pushing metered internet in several of the markets they serve. They do this because they do not have competition and out of greed. I happen to live in Pacifica, a city of about 40,000 people only 7.1 miles from downtown San Francisco, California where AT&T and Comcast are the only two providers in my area.
I really would like to know how is this telecom still allowed to continue to get away with ripping people off and what will it take for people to fight back and demand better. There has to be better than this.

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