FCC rescinds claim that AT&T and Verizon violated net neutrality

FCC rescinds claim that AT&T and Verizon violated net neutrality
Republican Ajit Pai halts Wheeler’s net neutrality investigation of zero-rating.
Feb 3 2017

The Federal Communications Commission’s new Republican leadership has rescinded a determination that AT&T and Verizon Wireless violated net neutrality rules with paid data cap exemptions. The FCC also rescinded several other Wheeler-era reports and actions.

The FCC released its report on the data cap exemptions (aka “zero-rating”) in the final days of Democrat Tom Wheeler’s chairmanship. Because new Chairman Ajit Pai opposed the investigation, the FCC has now formally closed the proceeding.

The FCC’s Wireless Telecommunications Bureau sent letters to AT&T, Verizon, and T-Mobile USA notifying the carriers “that the Bureau has closed this inquiry. Any conclusions, preliminary or otherwise, expressed during the course of the inquiry will have no legal or other meaning or effect going forward.” The FCC’s Wireline Competition Bureau also sent a letter to Comcast closing an inquiry into the company’s Stream TV cable service, which does not count against data caps.

The FCC issued an order that “sets aside and rescinds” the Wheeler-era report on zero-rating. All “guidance, determinations, and conclusions” from that report are rescinded, and it will have no legal bearing on FCC proceedings going forward, the order said.

AT&T and Verizon allow their own video services (DirecTV and Go90, respectively) to stream on their mobile networks without counting against customers’ data caps, while charging other video providers for the same data cap exemptions. The FCC under Wheeler determined that AT&T and Verizon unreasonably interfered with online video providers’ ability to compete against the carriers’ video services, as we’ve previously reported. If Democrats had maintained control of the FCC, the commission could have tried to punish the carriers and force them to stop the offending behavior.

The FCC also examined T-Mobile’s zero-rating but determined that it isn’t anti-net neutrality because T-Mobile offers data cap exemptions to third parties free of charge and “provides little streaming video programming of its own,” giving it less incentive to disadvantage video companies that need to use the T-Mobile network.

The net neutrality rules passed under Wheeler don’t ban data cap exemptions, but the FCC evaluates zero-rating on a case-by-case basis to determine whether specific implementations harm consumers or competitors.

Pai opposed Wheeler’s zero-rating investigation, saying that free data offerings are “popular among consumers precisely because they allow more access to online music, videos, and other content free of charge.” He has also vowed to overturn the FCC’s net neutrality rules and hasn’t committed to enforcing them while they remain in place.

“While this is just a first step, these companies, and others, can now safely invest in and introduce highly popular products and services without fear of commission intervention based on newly invented legal theories,” Republican FCC Commissioner Michael O’Rielly said today.



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