The FCC recently sent letters to major telecoms such as AT&T and Verizon, relating concerns about zero ratings services being bad for competition. The carriers told the Commission to back-off or potentially face consequences from the incoming Trump administration.
Under zero ratings, carriers essentially offer certain services to consumers that don’t count against their data limits; those can include video programming using services like DirecTV that AT&T is offering, Inside Towers has reported. Verizon handles its Go90 streaming service the same way.
The issue is major telecoms that own the majority of the networks providing internet connections can afford to remove data charges while streaming; other companies that have to pay the charges to provide the same streaming service cannot.
If major telecoms start offering services which only they can due to their size, that would hurt smaller companies, according to EconoTimes. Customers who typically watch video movies or streamed television programming pay monthly subscription fees in addition to the data they consume. However with services like DirecTV, they don’t have to pay for both. Such services are not banned under Net Neutrality rules, however both the agency and consumer groups believe they don’t follow the spirit of the rules, The Verge reports.
AT&T told the FCC it “takes sharp issue” with the conclusions the Wireless Telecommunications Bureau reached, noting that “Data Free TV is precisely the kind of pro-consumer initiative this Commission should be encouraging. Other video providers can be expected to respond to this innovation either by sponsoring their own content with AT&T and/or other wireless providers or by finding different ways to improve and differentiate their offerings and generate consumer value.” Indeed, AT&T says T-Mobile has already begun to do so.
“The bureau’s approach … would deny consumers a service they value, raise prices, lower consumption, and curb the disruptive potential of Data Free TV, all in the name of preserving profit margins for individual DirecTV rivals,” said AT&T, adding that: “It also would scrap decades of regulatory precedent making clear that even a monopolist may provide downstream services to an affiliate as long as those services are available to others on the same terms.”
The carrier added that Commissioners Ajit Pai and Michael O’Rielly will remain in office after the administration change and they’ve “criticized this investigation” and said whatever judgement the bureau may try to claim about the Data Free TV program before January 20, 2017, would likely be reversed.
December 21, 2016