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Last year, Comcast started exempting its own online video service from the data cap it imposed on consumers. When consumers streamed online video (say, because they were thinking about cutting the cord and replacing their Comcast cable subscription with an online competitor), that video counted against their cap. Unless, of course, that online video came from Comcast. Online video coming from Comcast was exempted from Comcast’s own data cap, giving consumers a disincentive to watch video from a competitor. We urged the FCC to investigate this anticompetitive use of data caps, and are still waiting for a resolution.
Today, while we continue to wait for the FCC to investigate data cap abuse, AT&T has decided to follow suit and exempt data from its own services from the data cap it imposes on its DSL and U-verse customers. Unlike every other type of data on those connections, data from an AT&T wireless phone does not count against the DSL/U-verse cap.
Microcells (also known as femtocells) act like little cell phone towers in your home. If you can’t get a signal from your cell phone provider, you can buy a little box that connects to your home internet connection. Your cell phone connects to the box, which connects to the internet, which connects to your carrier’s network, allowing you to make calls, send texts, and transmit data even when you can’t connect to a “real” cell phone tower.
AT&T has decided that the data from AT&T wireless microcells will not count against the data caps on AT&T DSL or U-verse home broadband connections.* This sets AT&T microcell data apart from every other type of data on those connections, including data from a Verizon or Sprint microcell. The message to AT&T DSL and U-verse consumers is clear: if your cell signal is weak and you are worried about your data cap, better get a phone from AT&T wireless. Simply put, this is an abuse of data caps.
We have raised a number of concerns about data caps over the years (in fact, we wrote a whole whitepaper about them). Some of those concerns are easier to understand or more controversial than others. However, there is one easy-to-understand concern about data caps that everyone should be able to agree on: ISPs should not be able to use data caps anticompetitively. The company that connects you to the internet should not be able to abuse its control of that connection in order to make its unrelated services more attractive.
That is precisely what Comcast did in the Xbox case and what AT&T is doing here. It is also one of the core concerns driving the net neutrality debate. If the FCC is unwilling or unable to protect consumers from data cap abuse, then Congress needs to step in.
Click here to tell the FCC to investigate data caps.
* Yes, AT&T Wireless does count data flowing from your phone to the Microcell to your own home internet connection against your wireless data cap. This means that data that never touches AT&T's wireless network still counts against your wireless data cap, regardless of your ISP. While it is not direclty connected to the issue in this post, it is hard to think of a legitimate justificaiton for this type of accounting.