FCC concerned about AT&T ex­empt­ing Directv from data caps

Kuwait Times - - TECHNOLOGY -

NEW YORK: Fed­eral reg­u­la­tors say that they are concerned that AT&T’s ex­empt­ing its directv unit from cell­phone data caps could hurt com­pe­ti­tion. AT&T lets cus­tomers watch video on directv apps on their AT&T cell­phones with­out eat­ing into monthly data al­lot­ments. It’s ex­pected to do the same with an up­com­ing, $35-a-month TV stream­ing ser­vice called directv Now. The Fed­eral Com­mu­ni­ca­tions Com­mis­sion, in a let­ter to AT&T dated Wed­nes­day, said that prac­tice may dis­ad­van­tage video providers that aren’t owned by AT&T, ul­ti­mately hurt­ing con­sumers. The agency asked that AT&T reply to its con­cerns by Nov. 21.

AT&T, which plans to launch directv Now later this month, said Thurs­day that con­sumers gain from watch­ing video with­out us­ing up their data - a prac­tice known as zero rat­ing. Any video provider can pay AT&T, “at our lowest whole­sale rates,” to let cus­tomers watch with­out us­ing up their AT&T data, said AT&T ex­ec­u­tive Bob Quinn in an emailed state­ment.

The FCC has looked at other com­pa­nies’ zero-rat­ing prac­tices as well. In its let­ter to AT&T, the FCC said that its con­cern was “not with zero-rat­ing per se,” which the agency has said may have some con­sumer ben­e­fits, but about us­ing it to hurt com­pe­ti­tion.

The FCC says that AT&T’s ap­proach is prob­lem­atic be­cause a ri­val stream­ing video provider could find it “in­fea­si­ble” to com­pete with Directv Now’s $35-a-month price if this com­peti­tor also had to pay AT&T to ex­empt its cus­tomers from data caps. And not pay­ing AT&T could make a com­peti­tor’s video ser­vice less at­trac­tive to cus­tomers, the FCC said.

Con­sumer ad­vo­cates have also raised con­cerns about zero rat­ing with re­gards to AT&T’s pro­posed ac­qui­si­tion of Time Warner Inc., which owns HBO, CNN and TBS. They have said that if the deal goes through, the tele­com gi­ant could try to fa­vor its own Time Warner con­tent and dis­ad­van­tage other video providers.

Other phone or ca­ble com­pa­nies that ap­ply zero rat­ing in­clude Ver­i­zon, which ex­empts its go90 video app and foot­ball games streamed from its NFL Mo­bile app from wire­less data caps, and Com­cast, which lets cus­tomers of its Stream ca­ble-re­place­ment ser­vice watch with­out it count­ing against a home in­ter­net me­ter.

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