The FCC Responds To Comcast's Latest Assault On Net Neutrality…With A Sheepish Letter

from the neutrality-tap-dancing dept

The FCC’s unwillingness to clearly ban zero rating as part of the net neutrality rules is starting to bite the agency — and consumers — squarely on the ass. Zero rating — or the practice of letting some content bypass an ISPs’ usage caps — is seen by many to be a major anti-competitive problem, given the act of giving some companies cap exempt status puts everybody else at a disadvantage. That’s why Chile, Norway, Netherlands, Finland, Iceland, Estonia, Latvia, Lithuania, Malta and Japan have banned the practice.

But the FCC, in its infinite wisdom, decided that instead of banning zero rating, it would take a wait and see approach, addressing zero rating behavior on a case by case basis. And you can understand the logic; the FCC believes it’s best to let ISPs experiment with what they insist are just creative new pricing models. The problem is one of precedent. Allow any form of zero rating, and you’ve already opened the door to the role of ISP as warden and gatekeeper. The other problem? The FCC’s wait and see approach has so far involved doing absolutely nothing, even in the face of obvious anti-competitive behavior.

As a result, T-Mobile’s now exempting both select video and audio streaming services from caps as part of its Music Freedom and Binge On programs. AT&T and Verizon’s “Sponsored Data” programs charge companies a fee to have their content receive preferred, cap exempt status, putting any smaller companies that can’t afford the fee at a disadvantage. Comcast has been slowly expanding its usage caps, then exempting its own content from them, giving it an unfair advantage against Netflix.

Though they vary in severity, all four of these companies are using their power as middlemen to potentially give some companies an advantage over others, the very thing our net neutrality rules were supposed to put an end to. Comcast’s behavior is probably the most unapologetically anti-competitive of the bunch. Yet the FCC’s response to most of these so far has ranged from total silence to outright praise.

Well, at least until last week, when the agency finally fired off letters to Comcast, AT&T and T-Mobile (pdf), asking them for more detail on zero rating plans that have been fully detailed for months (in AT&T’s case, a few years). At an agency meeting last week FCC boss Tom Wheeler made it clear this was simply an inquiry, not an investigation, and the letter informs the companies the FCC’s just looking to better understand what ISPs are doing (the agency was, apparently, in cryogenic storage all year):

“We want to ensure that we have all the facts to understand how this service relates to the Commission’s goal of maintaining a free and open Internet while incentivizing innovation and investment from all sources. We would also like to hear from you any additional perspectives you’d like to share about changes in the Internet ecosystem as a whole. To assist us in this review, we request that Comcast make available relevant technical and business personnel for discussions about the service with FCC staff, no later than January 15, 2016.”

While the FCC moves at a glacial pace, Comcast has spent much of the year using broadband usage caps and zero rating for unfair market advantage. Again, Comcast is imposing unnecessary broadband caps in uncompetitive markets to hinder Internet video, then exempting its own streaming service from usage caps to penalize competitors like Netflix. So far, Comcast has argued this couldn’t possibly be a net neutrality violation because the service spends significantly more time traveling over Comcast’s managed IP infrastructure instead of the public Internet. It’s a tap dance, and the FCC’s response is timid and underwhelming.

If the FCC had clearly prohibited zero rating, it wouldn’t have opened the door to Comcast’s latest logical lambada. As we worried when the rules were crafted, leaving zero rating enforcement ambiguous opens the door to all manner of net neutrality violations — just as long as an ISP is wearing the right tap dancing shoes.

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Companies: at&t, comcast, t-mobile, verizon

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Comments on “The FCC Responds To Comcast's Latest Assault On Net Neutrality…With A Sheepish Letter”

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Median Wilfred says:

Anybody remember "Comcast Searchlight"?

I stipulate that I haven’t had cable in maybe 4 or 5 years, but…

When I had Comcast cable, they would advertise “Comcast Searchlight”, which was apparently Comcast’s view of what interactive Tee Vee should look like. If their view of what people want to watch on cable is just as unimaginative, impoverished, and just plain LAME as “Searchlight” was, then there’s no worries. Comcast won’t attract very many viewers, despite the lack of caps on the content. Bowdlerized, ad-infested, insipid movies, vetted by a committee are just what people don’t want, and why they watch Youtube, or Netflix.

Anonymous Coward says:

Re: Anybody remember "Comcast Searchlight"?

Bowdlerized, ad-infested, insipid movies, vetted by a committee are just what people don’t want, and why they watch Youtube, or Netflix.

And Comcast wants to charge either their customers and/or Google and Netflix more that the loss of income from cord cutters. Its the Devils bargain, pay us the same whether you want cable or not.

Anonymous Coward says:

I find it odd that everyone believes T-Mobile talked to YouTube and Google, and Google said “no”.

I just don’t buy that. What I do believe, however, is that T-Mobile’s network simply can’t support giving YouTube for free, and T-Mobile created some sort of hot-air standard to prevent YouTube from being streamed.

Anonymous Coward says:

Re: Re: Re:

He is referring to the fact that YouTube is on the list of sites that does not count against the data usage. You know, the entire point of the article above. T-Mobile will have to eat the costs associated with supplying all of their users with YouTube data. I would assume they attempted to get a good pairing deal with google, but are unlikely to have tried to connect with them to share ad revenue on those videos.

Anonymous Coward says:

Re: Re: Re: Re:

He is referring to the fact that YouTube is on the list of sites that does not count against the data usage.

I believe that T-Mobile still charges their subscribers. That’s not exactly “free”, is it?

You know, the entire point of the article above.

Oh, I thought the article was about “zero rating”. I must have missed the part about free services.

Jeremy Lyman (profile) says:

The Optimist

I’m hoping this is the FCC giving Comcast just enough rope to hang itself. Let them go out and actually do the things they were claiming they “would never do!” just last year. Let them use their near monopoly status and usage caps to ram Comcast Content into customers homes; and use exactly that behavior as the wedge to force them to split apart their colluding infrastructure and content businesses. Once the “Com” is separate from “Cast” they won’t be able to argue that they’re not just pipes delivering bits, which opens the door for local loop unbundling… I know, I’m dreaming again.

ggurian (profile) says:

Capping broadband usage

Comcast isn’t the only cable company doing this, they have all jumped on the band wagon, and there isn’t anyone out there that is going to stop them. The FCC is just a joke, there isn’t any reason for these caps, and everyone knows it. It’s just another way for the cable companies to gouge more money out of everyone. I have 3 children who use their computers for school work, I work from home, and only occasionally do we watch Netflix or Amazon Prime, yet we manage to go over our 500gb rate every month. Why because every time we turn on a computer, a tablet, or our cell phone we are using data. Yet the cable companies are not paying anyone else for the data they supply. Someone please explain to me how this is fair.

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