Mobile

The opposite of net neutrality? AT&T to let big companies pay for data usage

AT&T is planning to launch a new service allowing content providers and developers to pay for their customers’ data usage, thus lowering the expensive data charges for some of its wireless subscribers.

Essentially, big companies like Comcast (owner of NBCUniversal) can pay AT&T for the total data charges associated with watching their content online. For instance, if you watched Celebrity Apprentice, Community, or Parks and Rec from NBC’s official application, none of the data used would count against your monthly allotment. The same would be applicable for Facebook, Twitter, etc.

Sound like a good deal? Well, it’s not.

AT&T’s new free-to-customers data service is similar to what the telephone companies did with toll-free calling on 1-800 numbers, AT&T’s head of Network and Technology John Donovan told the Wall Street Journal in an interview Monday.  The motive behind the new service is to create a new source of revenue for the company to compensate for the increased fees associated with higher data consumption from its subscribers.

The problem with this particular strategy is that it gives big companies with lots of money a way to succeed while smaller inventive/progressive companies will continually get ignored. Think about it. If you can only afford AT&T’s 250MB per month data plan, and all Twitter/Facebook data is free, you’ll never have incentive to use a better service. The next “Twitter” or “Instagram” is dead before birth. Eventually, this will hurt innovation and give the U.S. carriers more leverage over our mobile communication habits.

This kind of data service indirectly violates net neutrality — the position that there should be no restrictions by Internet service providers or governments on consumers’ access to networks that participate in the Internet.

AT&T, however, loves this new service because its much easier to secure millions of dollars in data usage from a big company than it is to collect it from each subscriber’s bill every month.

“This new plan is unfortunate because it shows how fraudulent the AT&T data cap is, and calls into question the whole rationale of the data caps,” said Harold Feld, legal director of digital consumer rights special interest group Public Knowledge in a statement. “Apparently it has nothing to do with network management. It’s a tool to get more revenue from developers and customers.”

Public Knowledge has made two request to the Federal Communications Commission to investigate whether its necessary for wireless carriers to institute data caps. Such an investigation would shed new light on the real costs of doing business.

As for AT&T’s new data service, Feld said: “This is exactly the type of market manipulation we hoped the FCC’s Open Internet rules would prevent. If the Commission does not believe it has the authority under those rules to investigate this practice, it should do so under its general authority over wireless services.”

What do you think about AT&T’s new proposed service plan that would allow big media companies and app developers to pay for all the data you use? Let us know in the comments.

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