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FCC Calls Out AT&T, Verizon For 'Zero Rating' Their Own Video Apps (zdnet.com)

Posted by msmash on from the taking-a-stand dept.

U.S. regulators are calling out AT&T and Verizon for exempting their own video apps from data caps on customers' smartphones. The FCC has sent letters to the country's biggest wireless carriers saying the way they handle the practice, known as "zero rating," can hurt competition and consumers. From a report on ZDNet: AT&T launched DirecTV Now earlier this week. AT&T Mobility customers can stream video data over LTE without impacting their data allowance. Verizon offers something similar with its go90 service. AT&T and Verizon don't see any wrongdoing. In a statement Friday, AT&T said exempting services like DirecTV Now from data caps saves customers money. Verizon said its practices are good for consumers and comply with regulations. "We will provide the FCC with additional information on why the government should not take away a service that saves consumers money," AT&T wrote in a statement Friday. The FCC hasn't released any official ruling on "zero rating," just guidance. It said on Thursday a similar letter was sent to AT&T in November, but the FCC didn't like AT&T's original response.

11 of 56 comments (clear)

  1. It's ok by cdrudge · · Score: 4, Insightful

    Just wait about a month and a half AT&T and Verizon. Everything will be a-ok.

    1. Re:It's ok by DickBreath · · Score: 3, Insightful

      Dear Internet Service Providers:

      If we didn't have data caps, then we wouldn't need data cap exemptions or Zero Rating, or whatever marketing euphemism you want to call it.

      --

      I'll see your senator, and I'll raise you two judges.
    2. Re:It's ok by space_jake · · Score: 3, Funny

      Shut up and buy it consumer, America is great again....

    3. Re:It's ok by Skuld-Chan · · Score: 3, Interesting

      To expand on this - a lot of people are like "Trump is right people should have to pay for usage". Thing is - ISPs already pay for peering, and their customers already pay for access to the internet - that's already happening and normal. What isn't ok is degrading someone else's service because a paying customer of your is using a competitor's application or host.

      Say like - Comcast intentionally slowing down the speed of Netflix because Netflix is competitor (Comcast probably views services like that as the literal end to their cable business).

      This is net neutrality.

    4. Re:It's ok by bondsbw · · Score: 2

      Nah, that's Vermin Supreme's campaign promise. It's easy to confuse the two, I know... one is a satirical candidate wearing something ridiculous on his head who wants to dismantle the government, and the other is Vermin Supreme.

      --
      All my liberal friends think I'm a conservative, all my conservative friends think I'm a liberal.
  2. Double the price and give them 10% off by Anonymous Coward · · Score: 3, Insightful

    "the government should not take away a service that saves consumers money"

    But the only reason it costs money in the first place is because you decided it does.

    1. Re:Double the price and give them 10% off by drakaan · · Score: 4, Insightful

      How about zero-rating *all* streaming data. That would save customers even *more* money, right?

      --
      "Murphy was an optimist" - O'Toole's commentary on Murphy's Law
  3. No worries by SailorSpork · · Score: 2

    With the anti-net neutrality people the new administration is putting in place in the FCC advisory committee, they just need to stall for a few months and it'll blow over. Then they can continue their anti-competitive ways in peace.

    1. Re:No worries by mysidia · · Score: 2

      With the anti-net neutrality people the new administration is putting in place in the FCC advisory committee

      Can't be too sure. The advisory committee is just that a council of advisors representing the Telecommunications and Media industries.

      The advisors are not the commissioners, they don't diect the FCC.

      There are two commissioners whose term expired and need new appointments, but Senate confirmation is required for those.

      The FCC is not supposed to be a politicized entity, as such, congress structured the FCC regulator as an independent agency,
      so the president is not able to simply dictate Fcc policies.

  4. They're lying. by msauve · · Score: 3, Insightful

    "AT&T said exempting services like DirecTV Now from data caps saves customers money. "

    No, it doesn't. Wireless network costs are shifted onto consumers who don't buy their streaming services. If all the costs of streaming bandwidth are included in the price of the streaming service, then reduce the cost of that service and let the consumers pay for the bandwidth directly, just like customers who use competitive streaming services.

    --
    "National Security is the chief cause of national insecurity." - Celine's First Law
  5. Should be illegal by Solandri · · Score: 4, Interesting

    Pricing their video service over cellular implies that the cost of the cellular hop is zero, and that the expense of transmitting the video to the viewer is all in the Internet link. Since their own video service is hosted locally, there is no Internet bandwidth consumed, and thus the price should be zero (which was what Netflix offered these guys for free on their landline ISP service and they turned it down). For a market economy to function properly, the minimum pricing has to reflect the expense incurred by the seller.

    I can understand zero rating as a temporary promotional measure (e.g. streamed video doesn't count against your cap for the first 6 months if you use our service). But making it the standard price is equivalent to dumping to try to kill off competition. Especially if they're using revenue from other sources to subsidize this service, like say, extra money they're collecting from Netflix in contravention of Net Neutrality.