AT&T Introduces "Sponsored Data" Allowing Services to Bypass 4G Data Caps

sirhan writes with news that AT&T has announced a program that allows companies to pay for their services to bypass mobile data caps. "With the new Sponsored Data service, data charges resulting from eligible uses will be billed directly to the sponsoring company ... Customers will see the service offered as AT&T Sponsored Data, and the usage will appear on their monthly invoice as Sponsored Data. Sponsored Data will be delivered at the same speed and performance as any non-Sponsored Data content." The Verge comments: "If YouTube doesn't hit your data cap but Vimeo does, most people are going to watch YouTube. If Facebook feels threatened by Snapchat and launches Poke with free data, maybe it doesn't get completely ignored and fail. If Apple Maps launched with free data for navigation, maybe we'd all be driving off bridges instead of downloading Google Maps for iOS." Or, think of distributed services: Mediagoblin vs Flickr, pump.io vs twitter, ownCloud vs Google Apps. This is probably a sign that data caps are here to stay, at least for AT&T subscribers (and if it's successful...).

Comments

Clever?

[Vermonter]

This is a clever idea. After all, now they are potentially getting money from deep corporate pockets, while at the same time giving their customers a bit more. Seems like it might be a win-win for AT&T.

Re:Clever?

[betterunixthanunix]

while at the same time giving their customers a bit less

FTFY. Remember the days when AT&T actually gave you unlimited service (back when "unlimited" actually meant "unlimited")? Remember how angry we were when they introduced the data cap?

Re:Clever?

[Travis Mansbridge]

And a loss for the open, free-sharing internet culture we've enjoyed so far. Perhaps we should revert to the one-way street that is Television.

Re:Clever?

[Raumkraut]

Seems like it might be a win-win for AT&T.

For something to be win-win, it requires two parties to simultaneously "win". In this case, the only "winner" would be AT&T.
And it rather gives lie to what they claimed to be the entire point of data caps in the first place - to help prevent over-saturation and congestion of their wireless networks. If there isn't enough bandwidth, then there isn't enough bandwidth - it doesn't matter whether or not both ends of a TCP connection pay, or only one.

Re:Clever?

[g0bshiTe]

Really, you don't think those deep pockets are going to somehow pass their savings on to the end users?

How about more ads, or hikes in subscriber rates, instead of you're $9 NetFlix sub imagine $40 for a NetFlix stream sub, to cover costs of their user base that watches on mobile media.

Anytime a company chooses to do something and passes it off to consumers as a mega corp will foot the bill, we usually end up paying in the end anyway.

Re:Clever?

[Charliemopps]

No, I work in the industry, there actually ISNT enough bandwidth. If this becomes popular, wait for the data caps to get lowered.

The only legitimate argument I've heard for this is that the content providers have been irresponsible with their delivery because it costs them nothing. For example, not allowing users to download off-hours, even encouraging them to all download at peak times, and not using proper compression. If using more bandwidth cost them more money then they'd be more inclined to work with the ISP to reduce the load on the consumers end.

Re:Clever?

[Vanderhoth]

In theory it's possible to provide more bandwith if there's more revene coming in topay for the infrastructure.

In theory AT&T should be using some of their $3+ Billion per quarter profits to pay for infrastructure upgrades rather than claiming they don't have enough money so they can justify throttling services, applying ridiculous caps and ensuring consumer prices remain high.

Re:Clever?

[IamTheRealMike]

You never actually had unlimited transfer quota, at the prices they were charging you it was physically impossible just due to the way spectrum works. What changed is that perhaps truth in advertising became more important (hah), or perhaps peoples understanding of what a gigabyte is got better so it became easier to tell it like it is.

Re:Clever?

[Sarten-X]

Yet AT&T profited by $7.3 billion last year, which is enough to replace 2.3% of their assets (including buildings and wires). They've had sustained profits for many years, but yet there's still not enough bandwidth.

Re:Clever?

[Charliemopps]

The problem is "Peak" usage. Which is usually friday and Saturday evenings. The rest of the week the networks fine, but during those 2 times usage quadruples due to a few sites. YouTube, Netflix, etc... mostly netflix. Ironically filesharing isn't even discussed when they talk about this stuff. Netflix is 80% of our traffic on Friday and Saturday nights. There's a lot netflix could do to make this less of a pain in the ass for the ISPs but so far they've been total asshats about the situation.

The ISPs don't want to charge the suppliers to get more money (though it's a nice side effect) what they want them to do is share the burden on their content so they have more incentive to change their products to reduce load on the network. This is a really hard issue to adress without giving the Feds some control over the internet that we'd rather not...

Re:Clever?

[tgd]

In theory it's possible to provide more bandwith if there's more revene coming in topay for the infrastructure.

In theory AT&T should be using some of their $3+ Billion per quarter profits to pay for infrastructure upgrades rather than claiming they don't have enough money so they can justify throttling services, applying ridiculous caps and ensuring consumer prices remain high.

Why? They're a for-profit business and they have a legal responsibility to maximize shareholder return. They don't claim they don't have enough money -- they're under no obligation to offer unlimited services. They're under one and only one obligation -- maximize profit. You, as a consumer, can choose to buy their service or not. If enough people end up in "not" then maximizing their profits will mean doing something different.

That's the way business works.

Re:Clever?

[swv3752]

They have received much in the way of Federal subsidies to upgrade their infrastructure. If they are not going ot do that, then they should be paying it back with high interest.

Re:Clever?

[QuasiSteve]

content providers have been irresponsible with their delivery

Hm?

For example, not allowing users to download off-hours

Aren't most of them streaming services which probably don't have a license to allow downloads (DRMed or otherwise)?
Even if they did allow downloads, don't most people these days favor streaming options? Why would I fret with starting a download at 8am (programming it into a DVR-like device, making sure it gets saved somewhere proper, etc.) when I can just hit play at 8pm anyway?

even encouraging them to all download at peak times

Did I miss a memo where e.g. Netflix tells people to watch Star Trek:TNG on Wednesday at 7pm just to piss off the infrastructure providers?
Otherwise, it seems to me that 'peak times' just happen to coincide with when people get home, or when a new episode of a popular series is made available, etc. That's not so much 'encouragement' as it is just the natural ebb and flow of media consumption.

and not using proper compression

Maybe you can just explain exactly what you mean here. If it's compression on the protocol level - well, maybe there are better options than what's being used now (what IS being used now?) - though the datastream tends to be not-so-easily-compressed anyway. If it's the actual media - e.g. "they should use lower bitrates in their encoding" - then I fear what the 'industry' is suggesting here, as most streams and downloads are quite block-artifacty enough, tyvm.

Re:Clever?

[Impy the Impiuos Imp]

This is anti-net neutrality under a different name. The throttle mechanism is supra-data cap charges instead of literal throttling.

Re:Clever?

[Jherek Carnelian]

If that's the terms the government wants, they can set those terms.

Since AT&T's lobbyists were responsible for most of the terms, I'm comfortable with Vanderhoth's original assessment. Just because our government representatives were corrupted doesn't mean AT&T is in the right.

Re:Clever?

[smillie]

They're a for-profit business and they have a legal responsibility to maximize shareholder return.

This idea always shows up whenever business is mentioned on slashdot. There is NO legal requirement to maximize profits, shareholder return or even to try to make a profit. The board of directors might get voted out if they keep making bad choices but that is by vote of shareholders, not a legal process.

You should read Google's SEC filings that say something like "we will do whatever we feel like doing even though some of those choices will cause a loss for the company."

Caesors Palace (Las Vegas) destroyed about 90% of the value of the company in the 80's to avoid a hostle takeover. As a shareholder I lost a boatload of money on that one but there was no legal recourse except voting to kick out the board of directors at the next shareholder meeting.

Re:Clever?

[Rotag_FU]

There's a lot netflix could do to make this less of a pain in the ass for the ISPs but so far they've been total asshats about the situation.

I disagree about the claim that Netflix is not trying to help the situation. After all they did introduce Open Connect (http://gigaom.com/2013/11/11/netflixs-new-pitch-for-open-connect-it-sucks-less-during-prime-time/) to address this situation. Basically they told ISPs that they would provide a content delivery network that would be colocated on their system to relieve network stresses. Netflix provides the hardware for free and all the ISP has to do is hook it up to their network and provide the space/power for the hardware. On top of that, it gives the ISP participating in Open Connect a competitive advantage since the Netflix streams can be higher resolution than other ISPs that do not participate.

Rather than being an "asshat" this seems to be going above and beyond to provide the ISPs with a solution for the claimed problems. Of course the real issue is that the ISPs (usually cable) are upset that Netflix is rapidly turning them into a dumb pipe and cannibalizing their ad revenue. However, the ISPs know that this is not a customer friendly argument so they make the, seemingly reasonable, argument about the heavy network utilization saturating. Netflix provided a solution to the stated problem, but not the real one (i.e. cable company greed).

It is also important to remember that the reason people pay the ISP for internet access is to have access to services like Netflix. If those services were not available, the ISPs would have less customers. If anything the ISPs should be thanking companies like Netflix, Google, etc. for providing content that people want and therefore compel them to want to buy internet access in the first place.

Re:Clever?

[houstonbofh]

This is anti-net neutrality under a different name. The throttle mechanism is supra-data cap charges instead of literal throttling.

No it isn't. Since bandwidth is now a metered product, this is noting more than a network 800 number. The speeds are the same, it is just a question of who pays.

Re:Clever?

[mrchaotica]

this is noting more than a network 800 number

It's nothing less than turning an inherently peer-to-peer medium for expression into Cable TV 2.0. It's pretty much explicitly designed to stifle new innovation (whether created by a fledgling company or especially when created as an open, distributed/self-hosted protocol) in favor of large entrenched players like Google and Facebook.

Re:Clever?

[FuzzNugget]

That's the way business works.

No, that's the way business works when they don't have a monopoly or anti-competitive oligopoly.

When there's adequate competition and businesses need to win customers over by product and service quality, then yes, they can do a whatever they want to maximize profits, because any steps they take towards such ends are offset by the pressure of competition. One business gets too greedy, another one will swoop in and eat their lunch.

Monopolies (and oligopolies) are supposed to play by different rules. They have no competitive pressure to prevent them from becoming abusive towards their own customers, so they need regulatory pressure. But in the good ol' US of A, when businesses become big enough, they just get rid of those pesky regulations by buying off politicians and regulators through legalized bribery and revolving door jobs. They're free to bend their own customers over a barrel and there's fuck-all you can do about it.

But, hey, that's just the way business works, right?

Re:Clever?

[tsqr]

I watch about 3 Netflix movies a week, and consume zero network bandwidth in the process. But I suppose you wouldn't really call the US Postal Service an ISP, would you?

Re:Clever?

[BrookHarty]

This is anti-net neutrality under a different name. The throttle mechanism is supra-data cap charges instead of literal throttling.

No it isn't. Since bandwidth is now a metered product, this is noting more than a network 800 number. The speeds are the same, it is just a question of who pays.

Its really simple, as an ISP, if you make your own services faster by purposly making others slow or cost more, thats against net neutrality.

AT&T is including their own services as unmetered so customers will want to use them over others. AT&T offers owncloud an online storage you pay for monthly, yet now bandwidth is excluded. They even let you back up your home PC and Phone's internal/external storage.

This is the the heart of network nuterality, an ISP's (Which AT&T is), charging more to use competitors services. So now AT&T can offer Email, Storage, Video/Picture sharing, for FREE yet charge you to use Google, Microsoft, Apple, etc using bandwidth costs.

This is no different than Comcast wanting to charge more for Netflix bandwidth, they found a work around by capping the data, and excluding their own Comcast Video On Demand service from the data cap. They would love to slow down the service and make HD unusable, but the horse is out of the barn, people are more educated now.

The end goal is customer lock in. They get you using their services, you dont want to move due to the hassle of data migration and costs. AT&T wants to lock customers in so badly they are offering to buy out your T-Mobile contract to get you to move.

AT&T isnt listening to its customers on what services they want or need, they are offering competing services but not new or improved services. Where is the core funcationality upgrades to voicemail and access controls. Where are the automated phone answering services with features? Overlay features such as temporary phone numbers for craiglist/ebay sales?, Location based services open to app developers, high priority data for business needs, bluetooth enabled services, payment services?

They are at the core of everything mobile related, yet they sit on their asses until its too late then try to limit other businesses by deceptive practices. They cripple phones for their own business purposes, they dont disable data roaming and people get hit with tens of thousands in data roaming charges, they over charge lines to the elderly, they charge for basics in a way to nickle and dime customers.

They should offer a good business model that enables services and growth, not try to be the big duoploy (verizon/att) and cripple competition.

Re:Clever?

[Jherek Carnelian]

Nor does it mean AT&T is in the wrong. In a world where every telco lobbies, those who employ lobbyists are 'in the neutral'.

Wow. Are you a psychopath?

And thus begins the end

[msobkow]

And thus begins the balkanized internet and the end of network neutrality, where service providers can start negotiating big bundle provisioning of their services over others.

This is bad

[LandDolphin]

This is bad for the market. The glory of the internet is that the barrier ro entry is so low. IF you start making it to where a company has to pay for the bandwidth of its users, then you raise the barrier of entry. Not good for innovation.

Re:This is bad

[Raumkraut]

IF you start making it to where a company has to pay for the bandwidth of its users, then you raise the barrier of entry. Not good for innovation.

Internet companies already pay for the bandwidth of their users - all incoming and outgoing traffic to a data centre is bandwidth which the data centre must pay their internet provider to carry.

Re:This is bad

[TWiTfan]

This is bad for the market.

That's unpossible! All my libertarian friends assure me that getting the government off the backs of our noble corporations will result in more freedom and openness, a free market utopia!

Re:This is bad

[neoform]

And they're adding a new layer of costs. Now instead of just paying for your bandwidth, you have to bribe hundreds of local ISPs to allow access to them.

This is just a sneaky way for AT&T to break net neutrality, first they offer special access to companies with deep pockets, next they start explicitly charging companies for mere access.

low cunning, not clever

[feepcreature]

It's just a repackaging of the old net-discrimination ideas that provoked the Net Neutrality debate.

Make data allowances artificially low, and charge content providers to "ensure" they are not throttled. It's not in the interests of consumers, and it's not in the interests of content providers.

I can see why AT&T might like it though...

Re:low cunning, not clever

[DigitalSorceress]

Exactly - it's reverse net-neutrality.

I wonder when wired broadband service providers will do that - as it is, I'm pretty sure Comcast/Xfinity is doing sort of the same thing - I can watch as many things "on demand" on my cable box as I want without touching my bandwidth cap, but if I stream the same movies/shows from Netflix/Hulu, etc... then it does count against my cap (which I will just preach to choir and say "what part of unlimited don't you understand")

Re:low cunning, not clever

[N1AK]

Quickest way to kill this? Google, Facebook and Twitter all bring in a policy saying that they won't pay providers who want to do this and providers doing this must pay them (at the same rate they charge) for all of their bandwidth their customers use or be blocked.

Re:low cunning, not clever

[jd2112]

Exactly - it's reverse net-neutrality.

I wonder when wired broadband service providers will do that - as it is, I'm pretty sure Comcast/Xfinity is doing sort of the same thing - I can watch as many things "on demand" on my cable box as I want without touching my bandwidth cap, but if I stream the same movies/shows from Netflix/Hulu, etc... then it does count against my cap (which I will just preach to choir and say "what part of unlimited don't you understand")

Unlimited - adj. The amount of money that a service provider can extract from you, either directly or indirectly. e.g. "Comcast offers Unlimited internet connections"

Re:low cunning, not clever

[thewolfkin]

I will just preach to choir and say "what part of unlimited don't you understand")

it's spelled Umlimited common mistake

Re:low cunning, not clever

[Anonymous Coward]

This, with a healthy dose of "post it on the top of every page of the site until the issue goes away" at those three sites, and the ISP's will have so much backlash it'll break their necks. Bonus points if they also say "loading this page has cost you $X bytes of data usage against your cap." Extra bonus points if they say "contact $ISPName customer service at $ISPPhoneNumber to ask for a data plan that doesn't have this limit."

Then watch as the fecal material collides with the mechanical cooling device.

Oh? Bandwith caps due to frequencies what?

[PPalmgren]

The issue with wireless data is entirely about last mile, the frequencies alotted and the limits of transfer within a cell at any given moment. Peering works on wired networks because throughput on the last mile outstrips deployment, the exact opposite issue of wireless networks.

Arguing that their obscene data caps are because of the wireless bandwith limits, then turning around and offering this without any true benefit to their bandwith issue other than their bottom line, is assinine.

Double Dipping

[DigiWood]

This is called "double dipping". These providers are not supposed to be able to do this according to the common carrier rules. The subscriber pays and they get their allotment. Any other payments to "overlook" a data cap that are made by a third party violates the common carrier rules because it creates an unfair advantage for large companies. They can afford to pay a fee to basically make the little guy penalized (having the little guys data count against the subscriber). If the subscribers complained to the FCC this pilot project would be stopped dead in its tracks.

I fear though that the only people that would care are the technically minded subscribers. The others would be snowed by some marketing speak.

Re:Double Dipping

[Imrik]

ISPs aren't subject to common carrier rules, they get the benefits without the restrictions.

We are coming full circle

[betterunixthanunix]

There is nothing new under the sun:

https://en.wikipedia.org/wiki/CompuServe

https://en.wikipedia.org/wiki/AOL#History

https://en.wikipedia.org/wiki/Digital_cable

Inversion of Control

[Warbothong]

What makes this interesting is the inversion of control. For years, net neutrality has basically hinged on the fact that users are paying their ISP for bandwidth, so it's up to the user what they do with it. This idea completely inverts that, so the user has absolutely no control anymore.

We were worried that walled gardens like Facebook were turning the Web into a consumer service, well this will do the same for the Internet itself.

geezer on the deck.

[nimbius]

the realist in me cant wait for this ayn-rand-as-a-service model to fail quietly another testament to ATT's pissbucket service in general. when given the opportunity, people will find other means to consume their favourite-as-a-service product that dont require sponsorship from some obtuse telecommunications conglomerate. every device on the planet has the option to connect to a wireless network, and that network likely doesnt have the kind of caps we're talking about in 4G land. WiMAX and municipal projects, library wireless and other providers will just make the effort that much more futile.

but im an old man (whats berkley vs ATT?) and the last big innovation for me was adding another monitor. Every turtleneck wearing coffee guzzling poseur giving their IDevice shaken-baby-syndrome in cap-induced frustration is instantly drowned out in the roaring cacophany of my mighty model M. Every tween fruit slashing and bird launching their way to mediocrity, tramp stamps and low test scores, is rendered irrelevant by my Thinkpad TrackPoint, gingerly lubricated in years of fine oils from chester cheetah himself. And the road warrior adjacent my supple yet torturous airport lounge chair gazes upon me as some sort of mystic christgod. For from the aether my sorcery has conjured up hundreds of thousands of documents when his most fervent efforts could not. in bated breath he will ask me, "how?" as his battery fails and his wireless bars recede. "local, repository." will be the words I visit upon him and like a cry so maddening unto his ears he will be rendered forever enlightened.

now if you'll please get off my lawn, I need to go back inside. the wheel is on.

Re:geezer on the deck.

[bgarcia]

I think the shift key on your mighty model M is only working sporadically.

Re:PR Horseshit

[g0bshiTe]

What corp that has big money these days doesn't have Congress, a CongressCritter, or some type of politician in their pocket?

These aren't the facts you're looking for.

[rmdingler]

So you mean the people with the money (corporations) would prefer to censor the information the average citizen has access to?

This would be unprecedented.

Re:loophole?

[g0bshiTe]

3.????
4.Profit

The future of the internet

[TWiTfan]

With the end of net neutrality, it was really only a matter of time before we started to see the internet turn into a place where the big companies control the data, and the little guys and startups get shut out. Free market my ass.

Re:The future of the internet

[TWiTfan]

The problem is that YouTube and Google were once the little guys themselves. Thanks to the neutrality of the early internet, they were able to get their start, prove their worth, and earn their spot as top dogs in a fair, free market environment. But now, with the end of net neutrality as a principle (both in government regulation and accepted market practice), the next Google or YouTube will never even get off the ground without going begging to one of the big companies for patronage. Innovation suffers and so does the consumer.

Re:The future of the internet

[organgtool]

Free market my ass.

This is precisely the results of the free market. Since there aren't regulations preventing data providers from double dipping or colluding with internet services, AT&T is free to offer "services" such as this, Don't worry, though, the market has a solution: if you don't like what AT&T is doing, then simply start your own nationwide wireless network to compete with them. The free market works!

My caps off to yah.

[VortexCortex]

I thought they already admitted the caps have nothing to do with congestion?

I wonder how much it would cost a quasi-turn based action RPG dev like me to get no data caps for trickling in world-battle-map updates so you don't have to wait to get your game on. I mean, in the middle of the night streaming in a bunch of data isn't costing them congestion issues. The hardware has to be there whether anyone's using it or not. I bet it'll be too pricey for me. Guess folks will just have to play it on their wired connections. So much for "progress".

If we had a few more competitors this wouldn't happen.

What happened to "networks are overloaded"?

[It doesn't come easy]

So, the original reason for data caps were that a few unscrupulous users were hogging all of the bandwidth and making everyone else suffer through a poor network experience...

I guess either that wasn't the real reason or AT&T doesn't mind if you have a poor network experience as long as they get more money...

Re:Gay T and T

[tgd]

This company sucks big time. And I thought I remembered reading a few months ago that they supported net neutrality. Total BS. Even Verizon does better

They may suck, but seriously -- don't act like a mouth breathing twelve year old with the slurs.

Re:Like the old days!

[1gig]

No even better do like Google and become the ISP Screw AT&T and all the rest of the ISPs and just do it yourself. Lets remember some of these content providers do have Very Deep pockets and the Technical know how to build it themselfs. And as Google is finding out you can make money at it. True maybe not as much as the other buisness but still enough that it pays for itself which is all they care about.

This is the real threat that AT&T and the others have to worry about at night. And as they continue to go down this path of squezzing the content providers the content providers start to look at the costs and really start to wonder why can't we just replace them and do it ourself.

Google Fiber is the opening shoot in this war don't be surprised if they don't have another and maybe bigger gun to aim at the AT&T and Verizons of the world. Just think what would happen if Google got in the bidding war for TMobile they can certinally afford to buy them and it would really shake up the wireless landscape.

combined fixed/variable model is better

[Chirs]

While I like the idea in general, a more accurate mapping of the costs would be to do it like my power/water/gas bills.

There would be a fixed monthly cost to cover the cost of simply having a line to my house, and then a variable per-GB cost to cover the data consumption.

In order to ensure fairness we could even follow utility pricing and have a rate review board that would have to approve rate increases. That way a reasonable profit could be ensured, but they'd be disallowed from raking the consumers over the coals.