FCC Questions Comcast, T-Mobile, AT&T Over Free, ‘Zero-Rating’ Streaming Services

Several Internet service providers (ISPs) have drawn the attention of the Federal Communications Commission with so-called "zero-rating" offerings, which is the practice of exempting certain services from counting against a customer's data cap. What FCC chairman Tom Wheeler wants to figure out is whether or not zero-rating services run afoul of net neutrality rules.

This is a relatively new thing on the part of mobile operators. T-Mobile made waves when it introduced Binge On, which allows customers to stream an unlimited amount of video from over 20 services, including Netflix, HBO Now, Hulu, Crackle, and many others. The video streams are optimized to deliver DVD quality (480p) or better and don't count against a user's monthly data allotment.


Comcast (Stream TV) and AT&T (Sponsored Data and Data Perks plans) offer similar gray area options that, for now, has the attention of the FCC. Whether it escalates to something more remains to be seen.

"This is not an investigation. This is not an enforcement," Wheeler told reporters.

One thing that's interesting about this is that Mr. Wheeler recently gave T-Mobile's Bing On program his blessing. At the time, Wheeler reiterated that the FCC is "pro-competitive and pro innovation," adding that Binge On "clearly...meets both of those criteria."

Is that still the case?

"We want to ensure that we have all the facts to understand how this service relates to the commission's goal of maintaining a free and open Internet while incentivizing investment and innovation from all sources," Roger Sherman, chief of the FCC's Wireless Telecommunications Bureau, stated in a letter sent to T-Mobile.

The FCC sent similar letters to AT&T and Comcast, the latter of which says its Stream TV service is in the clear and is not a zero-rated service because it "does not go over the public Internet. It is a cable service that only works in the customer's home."

It's an interesting time we find ourselves in. The FCC was successful in reclassifying broadband Internet as a utility, a move that gave it the power to enforce net neutrality rules. Since the beginning, the FCC has said it doesn't want to stifle innovation, but simply wants to maintain a level playing field.

The resulting Open Internet Order prohibits ISPs from blocking or throttling legal Internet traffic and offering paid prioritization, otherwise known as Internet fast lanes.