AT&T Makes Dangerous Move to Kneecap Net Neutrality

For years, Net Neutrality advocates have been asking for Congressional action to enshrine a simple principle into law: that all Internet data be treated equally, regardless of where it originates and who consumes it. The principle says further that no player in the market should be allowed to 'pay to play' on a fast-lane or have pay-to-play exclusive arrangements with providers in terms how their data is treated in any way that undermines competition.

Net Neutrality is the one principle that there truly has been broad agreement on from all sides of the political spectrum. Whether your flavor is The Nation or Redstate, the Internet media have long advocated for Net Neutrality.

After President Obama came to office, the FCC eventually announced rules enforcing Net Neutrality - but only among fixed broadband connections (translation from geek-speak: home or business DSL/Cable/Fiber Internet connections). But in the rules changes in 2010, mobile carriers were largely exempt, on the account that the mobile Internet industry was still new, and regulations needed to wait until carriers showed a willingness to break the rules.

The wait is over. At the Consumer Electronics Show in Las Vegas yesterday, AT&T announced a very dangerous move that would forever undermine Net Neutrality in the mobile space: dubbed "Sponsored Data", AT&T's scheme leverages high mobile data charges to stuff their corporate pocketbooks. For most people with a smartphone data plan, the fact of limited data is real. You buy a data plan for your phone or other device(s), and every time you use the Internet on the device while it's on the Network, it comes off your plan. If you go over, you pay more, or your speeds are crawled to a halt.

AT&T's plan devices an accounting hack. It says that for certain apps, the data that passes through those services will no longer count against your data limit. Terrific, right? Not so fast. AT&T isn't a charity. The only services that will be allowed to do this will be services provided by companies willing to pay AT&T for this privilege. Let's say Netflix signs up for this. They pay AT&T for the traffic that goes over AT&T's mobile services to its customers, and in exchange, AT&T doesn't count the data against your plan (billing Netflix instead of you for it).

To be clear, Netflix hasn't (yet) signed onto this scam. AT&T started with small partners for now, including the United Health Group.

So what's the problem? It is a cunning anti-competitive, anti-Net Neutrality proposition. It is AT&T acting as a gatekeeper and deciding whose data counts against your limit by who's paying them. If successful, the strategy would force established content providers to pay up - lest they be sidelined by consumers who will do anything to avoid data overages - possibly increasing the cost of those services to consumers while locking out newer upstarts from the market as consumers will be terrified to use them for the fear of running out of their small bucket of data. On the other hand, content providers will have a smaller incentive to make similar payment deals with smaller service providers, leaving their consumers at a disadvantage.

AT&T is also counting on user inertia. Even if this plan is successful, they know well that most customers will not be downgrading their data plan: some "just in case," and others will simply forget. And voila, they have in essence made you and the providers pay for data that's already been paid for.

This proposition tilts the Internet's playing field in favor of the big, established businesses and against small, agile startups, both for service providers and content providers. This plan won't put you on a slow lane by itself, but it will decide how long you can drive on the fast lane based on whether the content you consume comes from someone rich enough to pay your provider (who will in turn recoup the cost from you). The data from all sources will no longer be treated equally. It would turn the open Internet into an oligopoly of big content providers and big service providers, choking off competition and ultimately hurting consumers.

Even if a content provider does not directly increase the consumer's cost, they have to recoup their expenses somewhere. The most likely source, apart from direct consumer fees, is advertisement. Advertisement from other corporations - corporations rich enough to pay for it. In this scenario, the Internet's content world turns into your cable TV, with powerful corporate advertisers controlling the messages you hear, see, and read. Do we really need more corporate controlled content?

Let's take a hypothetical scenario. Let's say Fox News pays AT&T so that traffic to their app isn't charged against your data cap. So you can use their app to download all the propaganda about everything. But the White House can't compete because the government can pay to do this, and data to their app charges against your cap. Fox News decides to carry a live speech by the president with a split screen of propaganda scrolling about what the president is saying, whereas the White House app streams the event live without the propaganda or other helpful split screen data (like they did during the 2013 State of the Union). For someone trying to save on data, where are you watching the speech?

This doesn't even have to be Fox vs. the White House. It could be Rush Limbaugh vs. Stephanie Miller's video feeds and downloads on their respective apps. It could be choking a new media start up that wants to cover news. Or opinion. Or anything.

Fortunately for us, President Obama is still in office, and the new chairman of the FCC just ferociously reiterated the Administration's support for Net Neutrality. Hopefully, the FCC will also take steps to stop this mockery of Net Neutrality being started by AT&T (you can make your voice known here). The mobile Internet space is more mature, more developed, and  far more capable than it was in 2010, and it's time for regulators to move in to protect consumers.

But even the current Net Neutrality rules are under attack (from Verizon), and with a super-corporate-friendly Supreme Court, all the progress the FCC has made and can make can be washed away with the stroke of a pen from five men.

Unless Congress acts. Congress has the power to make Net Neutrality the law of the land, well within its explicit commerce powers under the Constitution. Though as we have seen, overwhelming public support and even across the political spectrum support seldom proves impetus for this Congress to act on anything (gun safety, immigration reform come to mind), time to act on Net Neutrality - regardless of type of network and type of data - is short, and the window to keep the Internet open and free (as in free speech, not free candy) is fast closing.

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