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T-Mobile And MetroPCS Go All In On The Horrible Precedent Of Zero Rating

from the setting-the-stage-for-disaster dept

Last year we noted that for being such a supposedly cool CEO, T-Mobile's John Legere seemed utterly clueless on the subject of net neutrality. Not only did the CEO claim that Title II and new net neutrality rules would "kill innovation" (tip: that didn't happen), he seemed totally oblivious to the bad precedent set by the company's zero rating efforts. Those efforts began with T-Mobile's decision to let some music services bypass user usage caps, which as we've discussed at great length puts smaller companies and non-profits at a distinct disadvantage.

But since our regulators (and much of the press and public) seem clueless to the harm of zero rating so far, T-Mobile has decided to expand these efforts. Last week the company started cap-exempting video services, and now the company has announced it's bringing zero rating to the company's prepaid wireless brand (MetroPCS) as well. Now the company's prepaid and postpaid (monthly billed) customers both will find that thirty-three of the biggest music stream services no longer count against their usage caps (yeah, sorry, small independent radio streaming stations too little to get on T-Mobile's whitelisted radar).

As usual, the move was framed as a huge boon to consumers:
“Once again we are setting MetroPCS apart from the rest of the pack in ways that no one else will,” said John Legere, president and CEO of T-Mobile US. “MetroPCS is the #1 brand in prepaid because we keep giving customers more of what they want, and today that means adding Music Unlimited and Data Maximizer to the list! Their data will last longer than ever before without ridiculous penalty fees or trickery!"
And like regulators, most of the telecom beat covering T-Mobile has been oblivious to the bad precedent set. They don't quite yet understand that letting a wireless carrier suddenly decide what traffic gets whitelisted from already-arbitrary usage restrictions sets the stage for a total upheaval of how the Internet works now. They also don't understand that if it's ok for T-Mobile to do this, it's ok for a company like AT&T to do something similar -- and AT&T's version is going to be notably worse. The Los Angeles Times, for example, struggles to see where the problem lies:
"Besides, there's nothing in the FCC's neutrality rules that bars data caps, which enable carriers to segment the market and charge higher prices to those who put a higher value on bandwidth. Binge On represents another reduction in the pain caused by data caps, which seems like an unalloyed good thing for consumers."
But you're not reducing a "pain point" by creating an arbitrary data cap, then letting some content bypass that cap -- you're just getting in the way of a healthy Internet ecosystem. And just because the FCC lacked the foresight to prohibit zero rating in our net neutrality rules (unlike Chile, Norway, Netherlands, Finland, Iceland, Estonia, Latvia, Lithuania, Malta and Japan, which all bar zero rating), that doesn't mean this isn't a potentially horrible idea that's going to change the face of the Internet. It's very clear that the perils of zero rating are something we're eager to experience first hand here in the States, applauding our own "great fortune" all the way.
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Filed Under: john legere, music unlimited, net neutrality, wireless, zero rating
Companies: metropcs, t-mobile


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  • icon
    vdev (profile), 20 Nov 2015 @ 2:14pm

    If the zero-rating is available to ALL video then it's probably OK. But if it's selective then it's just T-Mobile getting to pick winners and losers - not good.

    reply to this | link to this | view in chronology ]

    • identicon
      Davidg, 20 Nov 2015 @ 2:40pm

      Re:

      What about bittorrent traffic. Why r they favoring videos?

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Nov 2015 @ 3:14pm

      Re:

      It's not all video (or music), it's just approved sources.

      I can't setup my own server to string audio/video to my phone... and have it be cap-exempt. I have even emailed T-mobile to find out what they recommend for people who have collections of music that aren't on itunes or other "approved" streaming sites, and they had no response.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Nov 2015 @ 3:39pm

      Re:

      >available to ALL video
      What if i'm using a VPN? In order for them to zero rate content, they have to know what it is. And your viewing history will sold to multiple big data and ad companies.

      reply to this | link to this | view in chronology ]

    • icon
      techflaws (profile), 20 Nov 2015 @ 10:05pm

      Re:

      then it's probably OK

      Why would *any* totally arbitrary cap be ok?

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Nov 2015 @ 2:16pm

    The fact that they offer unlimited data for selected services shows that data caps have nothing to do with network management, and everything to do with profit maximisation and customer lock-in.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Nov 2015 @ 3:16pm

      Re:

      Pretty much. Either that or there are back door deals we're not privy to - with potential kickbacks to TMO.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Nov 2015 @ 8:48pm

      Re:

      The zero-rating for video is for services that are willing to seriously lower the quality of the video. The streamed video is 240p.

      So, arguably, it is related to network management.

      reply to this | link to this | view in chronology ]

  • identicon
    Chris Brand, 20 Nov 2015 @ 2:37pm

    It's like a 3rd-party paywall

    "You can visit these sites for free. For the rest, your first few visits are free but then you have to pay-per-view".
    That would be fine if it were the sites themselves that choose whether to put up the paywall or not, but it's problem when it's somebody else doing so.

    The difficulty is that they started off with "Your first few visits are free, but then it's pay-per-view" and then added "you can visit these sites for free" afterwards, so it's not nearly as obvious.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Nov 2015 @ 3:37pm

    It seems like there are fewer reasons to have a cell phone these days. We find our own surveillance and then they turn around and make a profit from it.

    http://adage.com/article/datadriven-marketing/24-billion-data-business-telcos-discuss/301058/

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Nov 2015 @ 3:43pm

      Re:

      hmm... that's a good point.

      Is T-Mobile using the BingeOn and MusicFreedom programs to collect customer listening/watching habits and reselling that information?

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Nov 2015 @ 3:43pm

    Really?

    "Not only did the CEO claim that Title II and new net neutrality rules would "kill innovation" (tip: that didn't happen)"

    So if it doesn't happen immediately, it will never happen? Is that your contention?

    reply to this | link to this | view in chronology ]

  • icon
    Kal Zekdor (profile), 20 Nov 2015 @ 4:22pm

    Curing congestion...

    Glad somebody else gets why these zero-rating programs are not pro-consumer.

    Data caps are completely arbitrary, with the sole purpose of bilking every last dollar from customers. As I've said elsewhere, lauding T-Mobile for these moves is like thanking someone for only punching you once. Yeah, he could have punched you twice, but that's not really a good deed.

    There's a better way to deal with congestion (fairly) if the telcos actually cared. You just need to throttle the heavier users on towers approaching capacity. Bandwidth not used is wasted. There's no reason to place a cap on data transferred when what you're trying to balance is bandwidth.

    T-Mobile already has mechanisms in place to throttle certain users. They just need to make it dynamic in response to current load. When load is light, everyone gets full speed without arbitrary caps. When load approaches capacity, those users who have historically added the most load get throttled down.

    Solves congestion, no arbitrary caps, and fairly allocates bandwidth between heavy/light users.

    Oh, one other thing. The Binge On program lowers the quality of any zero-rated video. So claiming that it's an improvement for customers is rather disingenuous. It's a trade-off, at best. (And only because customers can opt-out.)

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Nov 2015 @ 8:12pm

    How is this network neutral?

    How they think:

    Just to be fair, we'll set a baseline to overcharge for everything. So we're neutral, see? Oh, but then we'll exempt our "friends". But don't worry, we'll still be "fair". Almost anyone can become our friend for the right amount of money. What could be more fair and neutral that that?

    reply to this | link to this | view in chronology ]

  • identicon
    Faither, 22 Nov 2015 @ 5:52am

    Umm well...

    To provide zero rating you also need to know what you are delivering to those people.
    This means there are also privacy implications attached to zero-ratings.
    While they might not have to go full DPI yet in this day and age on the internet they still have to do a lot of data-analysis to come up with your monthly bill.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 22 Nov 2015 @ 11:32pm

    I know how to solve this problem. Just zero rate the entire internet. Problem solved!

    reply to this | link to this | view in chronology ]


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