Commentary

Verizon Touts Toll-Free Data In New FCC Filing

Verizon is pressing the Federal Communications Commission to endorse the idea that broadband providers can offer “sponsored data” features, which allow companies to pay for their material to be exempted from consumers' data caps.

“Sponsored data and other arrangements that only address pricing and that do not result in the differential treatment of traffic should be presumed reasonable given the potential consumer benefits,” Verizon says in a new FCC filing.

Earlier this year, Verizon competitor AT&T rolled out “sponsored data” for three companies -- ad tech firm Aquto, app developer and m-commerce software provider Kony Solutions, and health care company UnitedHealth Group. The sponsored-data concept, similar to toll-free phone numbers, allows those companies to pay for their content to be excluded from consumers' data caps.

The move sparked controversy, with advocacy groups like Public Knowledge quickly warning that sponsored data arrangements could harm startups that can't afford to pay for the data-cap exemption.

Consumer advocates also said that sponsored data plans call into question the original justification for data caps. “Caps are supposed to help wireless carriers manage congestion. But if getting a big check from another company suddenly makes AT&T’s congestion concerns go away, that shows data caps aren't necessary in the first place,” Free Press policy director Matt Wood stated earlier this year.

Verizon makes its latest pitch for sponsored data as part of a broader recommendation concerning net neutrality rules. The telecom says in its new filing that its representatives met with FCC officials last week to discuss Chairman Wheeler's original proposal for net neutrality regulations.

That initial proposal -- which remains on the table -- would allow broadband providers to forge “commercially reasonable” deals with content providers.

Many critics say those rules will result paid prioritization deals, which would involve broadband providers charging companies for faster delivery of their content. Critics of paid fast lanes, including President Barack Obama, are urging the FCC to instead reclassify broadband as a utility, and impose a ban on paid prioritization.

Verizon -- which opposes reclassification -- says in its latest letter that the FCC can adopt Wheeler's original proposal and still prohibit paid fast lanes. “If the Commission finds that certain practices, such as paid prioritization, are likely to harm competition or consumers, it could presume such practices are unreasonable or even prohibit them,” Verizon argues.

Meanwhile, two more lawmakers -- Sens. Cory Booker (D-N.J.) and Angus King (I-Maine) -- are publicly urging the FCC to reclassify broadband as a utility.

"An open Internet is not only essential for the future of America's economic growth, but it is also a ladder for social and economic mobility, allowing families in rural or low-income areas to access educational and social services, participate in our democracy and contribute to the marketplace of ideas," they write in a column that appeared today on CNN.com.

The Federal Communications Commission can pass rules that prevent toll booths, content blocking and discrimination by simply reclassifying broadband as a common carrier service.”

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