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Where Is Net Neutrality When We Need It?

Just in the last two weeks, two stories in the United States hit the press that highlight behavior from ISPs that would have likely have violated the Net Neutrality rules that were killed by Ajit Pai's FCC. The big ISPs have been surprisingly quiet and have not loudly violated those rules, even though they are no longer in effect. The industry speculation is that the big ISPs are treading lightly because they don't want to trigger a regulatory overreaction should there be a change of party in the administration or Congress.

The first headline says that AT&T is excluding HBO max from the calculation of any data caps. This is a big deal for AT&T cellular customers and not insignificant for AT&T landline broadband customers that face data caps.

AT&T defends this by referring to other 'sponsored data plans' in the industry, like the one offered by T-Mobile that lets premium customers exclude usage from YouTube, Netflix, Hulu, HBO, Sling YV, ESPN, Showtime, Starz and other sources of video.

I don't know enough to know if T-Mobile is violating the old net neutrality rules. Net neutrality rules would allow an ISP to exempt all videos from data caps and would not violate any rules because the ISP wouldn't discriminate against any particular source of video. However, if T-Mobile is being paid by those companies to exclude its data from data caps, T-Mobile would also be violating the spirit of net neutrality. AT&T's exclusion of HBO Max from data caps is more blatant since AT&T owns HBO — the policy is clearly being made to benefit HBO over Disney, Netflix or other competitors of HBO.

It was easy to predict that sponsored data is something that carriers would be pushing the envelope on, even if net neutrality was still in effect. It's something that customers like, and so it's hard to fire the public up that sponsored data is bad for the industry. But it is. AT&T is clearly disadvantaging other video services in favor of their own. If T-Mobile doesn't exclude all video from data caps, they are doing the same thing — just not to advantage their own video product. The original FCC net neutrality order pointed out that sponsored data can make it hard for a new market entrant, and they could be right — we don't see a lot of new names of companies that stream video.

The second headline is one that broadband customers everywhere will hate. Jon Brodkin in arstechnica describes a situation where Cox is slowing down the upload path to a customer for using too much broadband — and even worse is openly admitting to capping the upload speeds for an entire neighborhood.

I won't recount all of the details of the story. In a nutshell, there is a customer that is backing up huge amounts of data each night from midnight until 8:00 am. It takes that long to complete the backup because the upload speed available to the customer is only 35 Mbps. If this customer was on symmetrical fiber, this backup could be done quickly. Apparently, this customer has been doing the same thing for years, but they have recently been notified by Cox that they need to stop the practice or be kicked from the network. Cox also threatened by cut the upload bandwidth available to the whole neighborhood.

This particular customer uses over 8 terabytes of data per month, which is an extraordinary amount of usage on a home broadband line. But if the usage is all really late at night, it's unlikely that this is very disruptive to the neighborhood.

What's extraordinary about this is that the customer doesn't seem to be violating the Cox terms or service. The customers are already paying extra to avoid the data cap to get unlimited data. Cox is basically saying to the customer that there is some secret usage threshold that they associate with 'unlimited' data — yet they won't give the customer a targeted usage threshold.

Where Cox really crosses the line is when they threaten to penalize an entire neighborhood for using too much data. According to Brodkin, this one customer is not the only example of this same behavior by Cox.

If we had an FCC that regulated broadband, they would likely slap Cox for this behavior. What's odd is that Cox doesn't have to be so arbitrary. They could easily have established rules in the terms of service and their products that could have legally handled this situation. Instead, they sold unlimited data and decided afterward that there really is a limit on the amount of data they are willing to provide. The fault for this situation seems to lie mostly in the legal department at Cox, rather than with the customer who has had the same usage for years.

ISPs ought to realize that the regulatory pendulum always swings the other way. Ajit Pai has completely deregulated one of the largest industries in the country that touches almost everybody. That pushes the regulatory pendulum as far as it can go towards the 'unregulated' side, and a future Congress or FCC is inevitably going to bring back regulation again at some point. When they do, all of the bad behavior by ISPs during this time of deregulation will be used as examples of why regulation is necessary. If the ISPs push the envelope too far, the regulatory pendulum will swing a lot further in the regulated direction than they are going to like.

By Doug Dawson, President at CCG Consulting – Dawson has worked in the telecom industry since 1978 and has both a consulting and operational background. He and CCG specialize in helping clients launch new broadband markets, develop new products, and finance new ventures. Visit Page

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