Commentary

Watchdogs Urge FCC To Crack Down On Data Caps

Earlier today, consumer advocates renewed a push to convince the Federal Communications Commission to take a hard look at how broadband providers can use data caps to wield control over subscribers' Web activity.

Currently, many wireless providers, as well as some wireline service providers, offer some form of pay-per-byte pricing. Generally, people with these plans pay for a monthly allotment of data. If they exceed that amount, they either incur extra charges or are throttled to a crawl for the rest of the month.

But carriers like AT&T, Verizon and T-Mobile don't count all data equally when deciding whether people have gone over the maximum. Instead, those companies "zero-rate" video streams offered by some companies -- meaning that those streams aren't counted toward consumers' caps.

T-Mobile's Binge On program exempts video streams offered by around 00 companies from data caps, but also throttles all video to 1.5 Mbps. Binge On is activated by default, but users can turn it off. AT&T and Verizon zero-rate data from companies that pay to sponsor it, and in Verizon's case, from its own video service, go90.

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Today, advocacy groups including Fight the Future and Free Press reportedly gave the Federal Communications Commission a package with 100,000 letters by consumers criticizing data caps and their exemptions.

Those groups have argued for months that zero-rating services violate net neutrality principles. "They distort competition, thwart innovation, threaten free speech, and restrict consumer choice," advocates said about zero-rating services earlier this year.

The FCC, however, isn't convinced -- at least not yet. Chairman Tom Wheeler reportedly said today at a press conference that he is still gathering information about zero-rating services. Last year, soon after Binge On launched, Wheeler said it appeared "highly innovative and highly competitive."

But the agency later pressed T-Mobile to address questions about the service.

For its part, T-Mobile says in a new filing that it recently met with the FCC and discussed "how the company differentiates itself from its competitors through innovative and pro-consumer programs like Binge On."

The company adds that consumers have streamed over 500 million hours of free videos since the launch of Binge On last year, and that 92% of customers say they intend to watch more videos, thanks to the zero-rating service.

"T-Mobile customers benefit from experimentation and innovation, which brings fresh ideas like Binge On to the mobile broadband and video markets," the company writes.

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