Watchdog Group Requests FCC Examine AT&T, Comcast Broadband Caps

In a development that's glad news for any AT&T customer stuck with the company's new 150GB broadband cap, the New America Foundation and the Public Knowledge group have jointly asked the FCC to examine data caps. While they admit that such caps are not prima facie evidence of monopolistic abuse, they note: "they [broadband caps] carry the omnipresent temptation to act in an anticompetitive and monopolistic ways. Unless they are clearly and transparently justified to address legitimate network capacity concerns, caps can work directly against the promise of broadband access."

AT&T comes under particular fire. "Unlike competitors, whose caps appear to be at least nominally linked to congestions during peak-use periods, AT&T seeks to convert caps into a profit center by charging additional fees to customers who exceed the cap. In addition to concerns raised by broadband caps generally, such a practice produces a perverse incentive for AT&T to avoid raising its cap even as its own capacity expands. (emphasis original).

The letter raises further irregularities in AT&T's billing, including questioning why AT&T's limits are 100GB lower than Comcast's (introduced two years ago) and why AT&T has seen fit to saddle regular customers with a 150GB cap while U-Verse customers are given an extra 100GB. Furthermore, there's the fact that ADSL lines have always been marketed as less likely to be slowed by the activity of others on the same connection. The author of this story once worked for BellSouth when ADSL deployments were first marketed to the Louisville area and can confirm that this point was formally used to sell customers on ADSL at a time when cable providers offered higher maximum speeds.

The author's broadband usage for the month of May—AT&T has added an option to see day-by-day consumption.

The letter calls for full transparency and an investigation by the FCC into how often consumers exceed the cap, the services excluded from the cap (including telephony and voice/video programming), how customers are warned, the size of the penalty incurred by customers who do overstep the cap, and how data caps are related to network congestion.

This last is a critical point that's entirely missing from AT&T's current system. We've discussed the issue of Internet caps before and noted that while distasteful, an ISP has a legitimate right to control total bandwidth usage in order to provide good service to the entire network. AT&T's caps do not fall under this type of action. The company makes no claim to throttling bandwidth (a limited good) but has arbitrarily attached maximum data transfer policies based on how much money the customer already spends on AT&T services.

Hopefully the joint letter will nudge the FCC into investigating the issue. Data caps / throttling connections will always leave those few users who stress these connections less-than-happy—but AT&T is trying to establish a profit center for itself under the guise of network stewardship. With any luck, the plan will backfire--either because users depart for greener pastures, or because consumers who formerly opted for the company's higher-end ADSL plans now choose slower connections with less chance of inadvertently pushing them over the limit.