Senator Wyden Warns That AT&T's New Merger Poses A Massive Threat To Net Neutrality

from the nickel-and-dime dept

As AT&T fires up its lobbyists and various policy tendrils to sell the company's $100 billion (including debt) acquisition of Time Warner, the focus of the conversation has very quickly shifted to net neutrality and zero rating. AT&T already exempts its own content from the company's usage caps, and its DirecTV Now streaming service, launching later this month, is expected to follow suit. Once AT&T acquires Time Warner and its various properties (HBO, CNN), the worry is that this content will also get a leg up by being cap-exempt, creating an unlevel playing field for competing content and streaming services.

Senator Ron Wyden this week made it abundantly clear that he sees the new AT&T merger as a significant threat to net neutrality. In a letter to FCC boss Tom Wheeler (pdf), Wyden specifically points to AT&T's ever-expanding usage caps and the practice of zero rating as "anti-competitive practies that harm consumers" and small businesses alike:
"I am deeply concerned that if AT&T acquires Time Warner's content, the new mega-company will have incentives to prioritize its own content over content created by small business, independent artists or by its rivals."
As we've noted more than a few times, Wyden also highlights how usage caps are arbitrary and unnecessary constructs in the first place:
"Nearly all data caps, and particularly those attached to wireline broadband plans, have nothing to do with network management and everything to do with profiting from an ever-more-consolidated broadband market. Data cap plans that zero rate data at the discretion of the ISP violate the principle of net neutrality by creating an internet where one bit is favored over another bit absent user control...I am deeply concerned that if AT&T acquires Time Warner's content, the new mega-company will have incentives to prioritize its own content over content created by small business, independent artists, or by its rivals."
The problem, as we've long noted, is that while the FCC passed net neutrality rules last year, it failed to prohibit zero rating, and has yet to take any meaningful stand on usage caps. Usage caps aren't just price hikes on uncompetitive broadband markets, they're incredibly effective at giving incumbent ISP content a leg up in the market using zero rating. And while the FCC claimed it would be launching an "informal information exercise" to examine the negative repercussions of caps and ratings, that inquiry has resulted in jack shit in terms of actual enforcement.

As a result, we've now got AT&T, Comcast and Verizon all using caps to give their own content an unfair advantage, while Sprint and T-Mobile happily sell "unlimited" data plans that throttle games, music, and video unless consumers pay a premium. The FCC's failure to ban these peripheral behaviors, as we warned, opened the door to all of this, and AT&T's new mega-merger has the potential to take the problem to an entirely new level.

Wyden was quick to note on Twitter that he'll introduce legislation if the FCC fails to act:
The problem is that in a nation where the majority of consumers don't even know what a gigabyte is, zero rating is simply too confusing. Most consumers (and many reporters) still labor under the illusion that zero rating gives them something for free, ignoring that usage caps are an entirely arbitrary construct layered on top of what's already some of the most expensive wireless data rates in the developed world. Without consumers understanding how anti-competitive usage caps and zero rating truly are, there's less political pressure to do something about it -- which is why the FCC continues to twiddle its thumbs on the sidelines.

The debate over the AT&T merger is thankfully bringing this entire conversation to the foreground, but it's also going to be a wonderful opportunity for AT&T, its lobbyists, and loyal politicians to confuse consumers even further.
Hide this

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: competition, merger, net neutrality, ron wyden, zero rating
Companies: at&t, time warner


Reader Comments

Subscribe: RSS

View by: Time | Thread


  • identicon
    Anonymous Coward, 3 Nov 2016 @ 11:10am

    I fully expect a statement from AT&T (or someone paid by AT&T) along the lines of "Without Data Caps the Internet wouldn't exist. You wouldn't want China and Russia to use up all of the Internet would you?"

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

  • identicon
    Anonymous Coward, 3 Nov 2016 @ 11:13am

    This is exactly why I voted for Wyden again.

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

    • identicon
      Michael, 3 Nov 2016 @ 11:46am

      Re:

      Which would be meaningful if your E-Voting system was not hacked and your vote changed.

      Damn Russians.

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

      • identicon
        Anonymous Coward, 3 Nov 2016 @ 2:08pm

        Re: Re:

        Wyden is an Oregon senator. We vote by mail. No E-Voting systems.

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

      • icon
        Eldakka (profile), 3 Nov 2016 @ 7:52pm

        Re: Re:

        I doubt the Russians have any incentive to change votes.

        I mean, the current US political system is just as captured as the previous Soviet system. The only difference is in the Soviet system you had to be a member of the communist party. In the US system you have to be a member of one of 2 parties.

        I'd suggest the CIA or NSA have a greater vested interest in changing e-votes than the Russians.

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

  • identicon
    Anonymous Coward, 3 Nov 2016 @ 12:41pm

    it's a shame that there is no mention of how AT&T, as well as other telecom/ISPs restrict the implementation of better services, all done to protect themselves and how there are multiples of Congressmen/Women who have all aided this in whatever way they have been told to. perhaps he needs to raise this in Congress because it's no good having a go at Wheeler and the FCC if their efforts are kicked into touch by Wyden's fellow members

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

  • identicon
    Anonymous Coward, 3 Nov 2016 @ 12:51pm

    Hillary's already bought & paid for by ATT

    Podesta forgot to tell clueless Senator Ron Wyden.

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

  • identicon
    Anonymous Coward, 3 Nov 2016 @ 12:53pm

    Does AT&T's New Merger Pose A Massive Threat To Net Neutrality?

    Not wittingly.

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

    • identicon
      Ed Allen, 3 Nov 2016 @ 1:25pm

      Re: Does AT&T's New Merger Pose A Massive Threat To Net Neutrality?

      They know fully well that a neutral network leaves them without the power to extort
      additional fees from content providers for access to viewers who also must pay extra for access
      they already paid for.

      Netflix makes a profit, they think that it is only FAIR for them to get a percentage.

      The only way AT&T et. al. can increase profits without investing in improving service is by
      cutting current service off so that all parties will pay whatever they must to get it turned back on.

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

  • identicon
    Anonymous Coward, 3 Nov 2016 @ 1:29pm

    When did internet service stop being "too cheap to meter". It started being too cheap to meter as residential broadband started rolling out. I remember paying hourly rates for a dial up connection including a discount for off peak hours because my ISP had a limited modem pool.

    Also as metered connections are coming back into vogue why haven't we been seeing more discussion from state departments of weights and measures ensuring accuracy of the meters. I would expect government agencies to be looking for more regulatory authority. Which would then rapidly turn into regulatory capture and used to keep new entrants out of the market.

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

  • identicon
    Anonymous Coward, 4 Nov 2016 @ 9:28am

    isn't Wyden pro TPP?

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

  • identicon
    Anonymous Coward, 4 Nov 2016 @ 10:28am

    ATT / Comcast / Others?

    Is there a difference between any of them when zero rating their own "services"? Isn't the chief complaint with all of these services that their networks would be overburdened if EVERYONE could access video (or whatever) from other providers? So, for instance, if ALL of ATT's customers paid for and started viewing ATT's zero rated video on their phones the network wouldn't suffer. Hmmm -- sounds like a diversion tactic to me.

    So, why, then, Wyden, just pick on ATT?

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


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Close

Add A Reply

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Special Affiliate Offer

Essential Reading
Techdirt Insider Chat
Recent Stories

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it
Close

Email This

This feature is only available to registered users. Register or sign in to use it.