FCC Issues Report Attacking Zero-Rated Data Offerings From Verizon, AT&T

The Federal Communications Commission (FCC) has recently published a report (read the PDF file here) that states that even though zero rated data services generally do not violate net neutrality regulations, Verizon Wireless and AT&T, through their respective offerings, Go90 and DirecTV, are breaking the rules due to the fact that they deliver their own media content without affecting the data allotments of their respective subscribers. By doing this, the industry leaders are gaining an unfair advantage over other rival video content providers, especially those whose media content have an impact on customers’ data allowances per month.

More than a month ago, the FCC officially began questioning the two major US wireless carriers regarding their policies in delivering zero rate data, specifically requesting both to reply within a couple of weeks. But according to the agency, AT&T’s response did not adequately cover the FCC’s questions over net neutrality.

In its report, the FCC stated that the reply from AT&T did not allow the agency to sufficiently compare the terms and conditions of the wireless carrier’s offerings to customers of Sponsored Data with the terms and conditions of its DirecTV service. Because of the limited information provided to the FCC, the agency could not fully determine that the mobile operator was indeed complying with net neutrality rules.

After the FCC released its report, AT&T responded by way of a blog post -- Joan Marsh, the Senior Vice President of Federal Regulatory at AT&T, stated that what the wireless carrier is doing is to simply give mobile users an opportunity to enjoy access to a wide range of video content without incurring costs.

Among the Big Four carriers in America, T-Mobile is considered by many as the first to leverage zero rate data offerings, most notably when it launched its Music Freedom feature back in 2014 and then last year with its Binge On service. Some may remember that Binge drew some flak from supporters of net neutrality, but by accepting media content from any video provider who complies with specific technical requirements, T-Mobile was able to deflect some of the attacks.

Resolving the issues over zero rated data also face some uncertainty. Tom Wheeler, the current Chairman of the FCC has long advocated for net neutrality, with Democrats enjoying a 3 to 2 advantage over Republicans on the agency. But Wheeler is set to leave his post this coming January 20th, when the President-elect Donald Trump officially becomes President, and when that happens, Republicans will look to achieve a majority.