Deutsche Telekom Dumps Net Neutrality; Will Limit Bandwidth For Competing Video & Voice Products

from the net-neutrality-is-for-other-people dept

It appears that Deutsche Telekom has decided that it can and should ignore the basic principles of net neutrality. It is setting up limits on how much traffic its customers can use, and saying that competitors' video products will automatically be throttled to 384k, which makes them basically useless. But, of course, this throttling does not apply to Deutsche Telekom's own video offerings.
The data traffic generated by the use of Telekom' own IPTV platform Entertain won't be attributed to the volume integrated in the tariffs. "With Entertain, customers book television. We will therefore ensure that they will not suddenly sit in front of a black screen," explained Hagspihl. Also, voice telephony through Telekom's fixed line subscription will be excluded.
But... competitors? Well, too bad. This is a fairly bold move by DT. Of course, telcos have long wanted to do this, trying to force people and lock them in to their own (often overprice and underpowered) services, but to directly punish competitors is a pretty blatant statement by Deutsche Telekom that it thinks it can get away with this because of its dominant position in the market. Of course, if I'm a Deutsche Telekom customer, I'd be incredibly pissed off that Deutsche Telekom is basically telling me that I'll be penalized for using other video or voice services, even if they're better. Yes, those competing services will work fine beneath a certain traffic level, but people don't realize just how much data they often use these days -- especially when you're talking about bandwidth-heavy video.

Deutsche Telekom's explanation for this is almost entirely bogus.
"We want to continue offering our customers the best network in future into which we invest billions of euros. However, constantly increasing bandwidths can't be financed through constantly dropping prices. We will have to charge customers with very high data consumption more in future," said Michael Hagspihl, managing director marketing at Telekom Deutschland.
First of all, broadband remains an incredibly profitable business, and while the telcos love to make these claims, they're simply not supported by the data. They're making money like crazy on their existing networks, and although keeping up with the growth in bandwidth does require some investment, it's easily affordable under the current structure. What this is about is exactly what everyone knows: killing off competitors, limiting the market from disruption and trying to control these other services, like video and voice, so that people are forced into using Deutsche Telekom's own services.

In fact, Deutsche Telekom's CEO more or less shows off the standard hubris of telco execs these days, believing that the only thing that's important on the internet is his network, and everything else you get is only because of him:
"Without our telecommunications networks and modern primary products there wouldn't be any online services coming from Google or Apple," [Deutsche Telekom CEO Rene] Obermann told the Deutsche Presse Agentur.
Uh, I think you mean that without your monopoly power over the network people wouldn't have to use your lines to reach those services, which is what they really want. The "value" here that people get isn't Deutsche Telekom. They supply the pipes. The value is in all of the various services available, and Deutsche Telekom is trying to make those useless... oh, unless, those service providers want to pay up. It's the same old net neutrality story. The telcos overvalue their networks and they try to get paid twice for the same thing. They want customers to pay to reach Google and Google to pay to reach the customers.

Thankfully, the German government isn't too keen on where this is going:
Economic Minister Philipp Rösler voiced concern in a letter to Telekom's CEO Rene Obermann on Wednesday, a copy of which Spiegel Online obtained.

In the letter, Rösler warned of possible restrictions for "flat rate" customers. He said Federal government and consumer protection authorities would "follow very carefully further developments in relation to the varying treatment of Telekom's own services, and that of others, in terms of network neutrality."

Federal Consumer Protection Minister Ilse Aigner also criticized the new policy in an interview with Spiegel Online. "At first glance, progress for the customer can not be seen," she said. "Limiting flat rates is certainly not consumer-friendly," the Bavarian conservative CSU minister said.
Deutsche Telekom has its dominant position in the market because until not that long ago it was the state owned telecom provider. Trying to block out competitors with bogus excuses and limitations for consumers certainly seems like a pretty big abuse of that position.


Reader Comments (rss)

(Flattened / Threaded)

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    Ninja (profile), Apr 26th, 2013 @ 10:31am

    Well, if this goes trough then it'll be made clear the corporations are running the show. Meanwhile VPNs will do the job of maintaining neutrality. But till when?

     

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      Zakida Paul (profile), Apr 26th, 2013 @ 12:29pm

      Re:

      Ah, VPNs. Where would we be without you?

      The company I work for would not be able to operate as effectively, that's for sure.

       

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      Anonymous Coward, Apr 26th, 2013 @ 12:45pm

      Re:

      VPN's may not work in this case, because Deutsche Telekom can simply throttle high bandwidth connections that are not from their own service.

       

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      out_of_the_blue, Apr 26th, 2013 @ 12:59pm

      Re: Actually, Mike got it wrong: this about data caps.

      The only relevant point in the original article, which you clearly didn't read, is that service from their own local servers isn't included in the cap. That's logical, but little to do with neutrality: the data caps are just EXACTLY as what I'vd got with my ISP. So big deal. I'm not alarmed that with this Germans are going back under the Nazis. -- But with the central banks, YES.

      2nd point, VPNs have NOTHING to do with this, NOR will they get around the data cap. Yet again, VPNs won't save you.

       

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        PRMan, Apr 26th, 2013 @ 2:54pm

        Re: Re: Actually, Mike got it wrong: this about data caps.

        Actually, thanks OOTB. You actually contributed something useful to the discussion!

        They will be limited to 384K once they use up their cap which is at 75GB to 400GB per month, depending on the plan.

        Since the average usage is 15GB to 20GB, this will affect very few extremely high bandwidth users.

         

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          techflaws (profile), Apr 26th, 2013 @ 10:42pm

          Re: Re: Re: Actually, Mike got it wrong: this about data caps.

          Since the average usage is 15GB to 20G

          [Citation needed]

          And NO, an official Telekom statement on this is NOT considered unbiased.

           

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          Anonymous Coward, Apr 27th, 2013 @ 6:19am

          Re: Re: Re: Actually, Mike got it wrong: this about data caps.

          Seems that some missed the point that Deutsche Telekom will start to implement the data caps in 2016. 20GB today will be >60GB in three years.

           

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        techflaws (profile), Apr 26th, 2013 @ 10:47pm

        Re: Re: Actually, Mike got it wrong: this about data caps.

        the data caps are just EXACTLY as what I'vd got with my ISP
        So f**king what?

         

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        PaulT (profile), Apr 27th, 2013 @ 1:30am

        Re: Re: Actually, Mike got it wrong: this about data caps.

        Ah, ootb, always looking at an excuse not to criticise his beloved corporations. Here, a blatant violation of net neutrality is acceptable to him because he found a convenient excuse.

        He won't bother about the problems this will cause, the damage to competitors and the monopoly position that's sure to be abused. No, he has a convenient excuse so all's OK!

         

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    Anonymous Coward, Apr 26th, 2013 @ 12:38pm

    Next Headline: Google announces its fiber service is moving into Berlin.

     

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    gorehound (profile), Apr 26th, 2013 @ 12:45pm

    Hope the German Youth know what to do.The dice has been cast and it has been shown that Mr.Corporation needs to be taught a lesson.
    Love to see the people rise and take care of Business.
    Bring on the Revolution and Power to the People !

     

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    identicon
    out_of_the_blue, Apr 26th, 2013 @ 12:47pm

    Oh, it's terrible! -- Until look at numbers Mike left out.

    "if they exceed the volume included in their tariff." -- Which is "average customers currently use 15GB to 20GB of data volume per month. The smallest integrated data volume will be 75GB and the highest 400GB."

    I'd say a WHOPPING 400GB! But even 75GB is LOTS. -- I fall into the "average" range, by the way, and that's actually too much. -- If to the allowed levels, you NEED some limits on your habits. Won't harm you, nor will NOT having a third slice of pie.

    And eventually any network will be saturated, so it's wise to think ahead. Everyone can't have all the bandwidth they want. ("Unlimited" for fixed price is one of Mike's fondes notions.)

    Anyhoo, as usual Mike gives advice on how to run a nation-wide telecom, without of course ever having actually run anything besides this blog.

     

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      JEDIDIAH, Apr 26th, 2013 @ 12:58pm

      OOTB: Always the corporate apologist.

      The problem isn't the bandwidth cap.

      The problem is that services aren't being treated equally. The streaming version of Netscape is having it's air supply cut off by this Microsoft wannabe.

      The problem is that the monopoly is favoring it's own services over that of it's rivals.

       

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        identicon
        out_of_the_blue, Apr 26th, 2013 @ 1:01pm

        Re: OOTB: Always the corporate apologist.

        This is EXACTLY the same deal that the ISP I use has! It's NOT that they've moved to favor own service, that's just incidental when the server is local, they don't have the same bandwidth costs.

        IT'S JUST A DATA CAP. LIKE THE ONE I HAVE.

         

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          JEDIDIAH, Apr 26th, 2013 @ 1:19pm

          OOTB: Always the corporate apologist.

          Their peering costs are likely non-existent.

          It's the last mile bandwidth that poses any real challenge.

           

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      Nigel (profile), Apr 26th, 2013 @ 12:58pm

      Re: Oh, it's terrible! -- Until look at numbers Mike left out.

      Collapse and move along.

      If this dude didn't have a brain in his head he would lonesome.

      Nigel

       

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      Anonymous Coward, Apr 26th, 2013 @ 1:18pm

      Re: Oh, it's terrible! -- Until look at numbers Mike left out.

      I wonder if it's possible to litigate against you for actual physical harm as a result of reading your comments.

       

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        Some Other AC (profile), Apr 26th, 2013 @ 2:29pm

        Re: Re: Oh, it's terrible! -- Until look at numbers Mike left out.

        We could call it out_of_the_averagejoe_Bob Syndrome. Causes repeated uncontrollable facepalms and head to desk.

         

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      RD, Apr 26th, 2013 @ 5:00pm

      Re: Oh, it's terrible! -- Until look at numbers Mike left out.

      "Anyhoo, as usual Mike gives advice on how to run a nation-wide telecom, without of course ever having actually run anything besides this blog."

      Says the failure who's only credit is ShillTroll(tm) ranting on said blog site.

      Which also makes you JUST AS UNQUALIFIED to post on the subject as Mike, per your own argument. QED.

       

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      Ninja (profile), Apr 29th, 2013 @ 3:18am

      Re: Oh, it's terrible! -- Until look at numbers Mike left out.

      I'd say a WHOPPING 400GB! But even 75GB is LOTS.

      I'm using around 100Gb per month with streaming videos. My ISP has data caps in their policy but if they chose to enforce ppl would probably get mad because any 1080p usage will eat most of the monthly cap in less than a week. Actually it could be as fast as 2 days if you watch around 3 movies. I almost use all of my 2Gb cap on my phone and I've never downloaded anything infringing via that connection...

      A loopy tour into ootb's clueless fantasy world indeed.

       

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        PaulT (profile), Apr 29th, 2013 @ 3:54am

        Re: Re: Oh, it's terrible! -- Until look at numbers Mike left out.

        One of the failings with ootb and his troll brethren is that they lack both the knowledge of how services are currently used and the foresight to understand how they may be used in the future.

        In his tiny little head, "lots of traffic" = "lots of downloads" and "downloads" means the same as "piracy". Both of these are of course fallacies. Traffic has many components, with streaming being the most bandwidth heavy. Someone streaming 2 movies a day on Netflix may consume significantly more bandwidth than someone torrenting a single movie every day, yet in ootb's head only the downloading counts. If you consider downloading alone, some games on legal download services are in excess of 10Gb each, and some services require regular patches of up to 1Gb or more, which DLC is often multiple gigs, not to mention the bandwidth requirements of online gaming. Yet he'll also discount these as well.

        While dismissing these perfectly legitimate high bandwidth uses, he's not only denying current reality, but the future as well. New consoles are placing a great emphasis on online use and purchases. Netflix are looking at offering 4K streaming, as are Apple, and YouTube already supports it. More and more people are using more and more devices, meaning you can be having 4 members of a household streaming a movie in HD at that same time over the same connection on a regular basis.

        Anyone with half a brain can see that bandwidth requirements are going to increase exponentially as new hardware and services require more of it and those services become more commonplace, yet these idiots are going "well *I* don't need that much bandwidth *now* so it down't matter". It's a failed argument before they even start.

         

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    Anonymous Coward, Apr 26th, 2013 @ 1:05pm

    Wow, are Deutsche Telekom taking queues from Kim Il Un? What a bunch of greedy, shortsighted pricks.

     

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    Anonymous Coward, Apr 26th, 2013 @ 1:21pm

    cant imagine where they got the idea of killing off competition from (usa entertainment industries!), can you? if this is allowed to go unchecked, which i doubt it will, it would certainly mess up the broadband speed plans that are supposed to be going on

     

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    mark, Apr 26th, 2013 @ 1:44pm

    They also argue that they don't breach net neutrality because their own Services that are excluded from this Traffic Limit are "Managed Services" and have guaranteed QoS. And this Managed Services are also available to Google and other competitors if they are willing to Pay.

     

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      Anonymous Coward, Apr 26th, 2013 @ 2:13pm

      Re:

      What odds that without Google paying, their service gets reduced bandwidth, drop outs and delays.

       

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      JEDIDIAH, Apr 26th, 2013 @ 7:09pm

      Monopoly trolling...

      They're on crack. The whole point of net neutrality is to prevent precisely that kind of blackmail and trolling.

      The "willing to pay part" automatically makes it not net neutrality.

       

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    techflaws (profile), Apr 26th, 2013 @ 10:45pm

    Thankfully, the German government isn't too keen on where this is going:

    Don't kid yourself. Rösler is a joke and the government will fold on this as they ahve with the Leistungsschutzrecht.

     

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    That Anonymous Coward (profile), Apr 27th, 2013 @ 12:21am

    And yet if Google did this, they would be suing them for a kajillion dollars....

     

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    Anonymous Coward, Apr 27th, 2013 @ 2:13am

    I could see a lot of new VPN customers from Deutshe Telekom who want to evade this.

     

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    Anonymous Coward, Apr 27th, 2013 @ 4:16am

    The "value" here that people get isn't Deutsche Telekom. They supply the pipes.

    Pipes paid for with public money, one might add. I'm not quite sure how they ended up in the sticky hands of the Deutsche Telekom corporation. I guess it made sense to someone, somewhere.

     

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      PaulT (profile), Apr 27th, 2013 @ 6:05am

      Re:

      "I'm not quite sure how they ended up in the sticky hands of the Deutsche Telekom corporation"

      Like most national telephone companies, DT was a publicly owned monopoly until it was privatised in the last few decades. Just as with, say, BT in the UK or Telefonica in Spain, they still maintained a defacto monopoly until real competition was able to appear, though I'm not sure how truly competitive the German telecoms market is at the moment. But, whatever infrastructure was paid for by public money will be in their hands because that's probably who installed them to begin with.

       

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        Anonymous Coward, Apr 27th, 2013 @ 8:41am

        Re: Re:

        Well, yes, that's who installed them. But from that doesn't follow that we should hand over the publicly funded pipes to them as they go private.

         

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    mattarse (profile), Apr 27th, 2013 @ 3:43pm

    I'm late to this conversation but I was mentioning this to a German friend and he mentioned that because of criticism of the plan they will not be instituting it until 2016 (and who knows what will change by then).

    Source below - in German but google translate does ok with German pages -

    http://www.spiegel.de/netzwelt/netzpolitik/internetprovider-telekom-bremst-nicht-als-einziger-a- 896606.html

     

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      techflaws (profile), Apr 29th, 2013 @ 1:24am

      Re:

      That wasn't due to criticism but right from the start (which makes the caps even more ridiculous, 75 GB in 2016, come on!). Apart from that, all other providers will follow when Telekom gets away with it.

       

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    alex (profile), Apr 29th, 2013 @ 6:46am

    Ooof

    I'm in Berlin and use T-Com (Deutsche Telecom) at home. I didn't even realise they have a video platform. I might have to look into switching...


    I know they do various slightly dodgy tactics to keep their monopoly. For example, when you want to get a new internet connection - all of the ISPs you speak to say they can install in ~6wks except T-Com who can install in 2wks (They also own the phone lines I believe so all the ISPs have to use them anyway).

     

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