AT&T Called Out After Announcing They Will Count HBO Max Data Towards Caps

AT&T has announced that traffic used by HBO Max will count towards users data caps. The EFF has called them out on this, saying it was never free.

In June of last year, the Open Internet started seeing signs of collapse. This after AT&T introduced fast lanes via “sponsored data”. In that case, traffic going to AT&T owned service, HBO Max, would not count towards consumers data caps. It’s the kind of thing that became allowable after the FCC repealed network neutrality in 2017.

Of course, in the wake of the FCC repealing the critical rules, different states began introducing their own network neutrality rules. This in a bid to protect consumers from the monopolistic providers who gained such an overwhelming amount of new power over what users can and cannot see online. Republican’s, naturally, opposed the move afforded by state rights and actively fought against it. Still, some states went ahead anyway. California was the big state everyone was watching at the time. US ISPs tried to block the move by California to implement network neutrality laws, but last month, the ISPs lost the bid to skirt network neutrality laws as the case moved forward.

BNN is noting that AT&T has told California customers that use of HBO Max would count towards their users data cap. They said that the California rules prevents them from favoring their own services in that way.

AT&T Inc. will start counting HBO Max viewing toward customers’ data limits, ending one of the perks of subscribing to both the company’s streaming and wireless services.

In a blog post, AT&T said California’s new net neutrality law bans “sponsored data” services, which let the company pay for the data usage of customers who also subscribed to AT&T’s streaming platform.

AT&T, which developed HBO Max after buying Time Warner Inc. for $85 billion in 2018, had used sponsored data to let wireless customers stream AT&T-owned video services without it counting against their data limits. The company said the new law affects customers in states beyond California “given that the internet does not recognize state borders.”

That change means customers will see HBO Max viewing add up on their monthly data plans — if they go over their allotment — and connection speeds could be slowed or throttled.

The Electronic Frontier Foundation (EFF) called AT&T out over the move. They are arguing that the service was never free to begin with:

It should be noted that net neutrality doesn’t prevent companies from zero rating in a non-discriminatory way. If AT&T wanted to zero rate all video streaming services, it could. What net neutrality laws prevent is ISPs from using their control over Internet access to advantage its own content or charging services for special access to its customer base. In the case of HBO Max and zero rating, since AT&T owns HBO Max, it costs them nothing to zero rate HBO Max. Other services had to pay for the same treatment or be disadvantaged when AT&T customers chose HBO Max to avoid overage fees.

This is why AT&T is claiming that it’s being forced to stop offering a “free” service because of California’s net neutrality rule. Rather than admit that the wireless industry knows zero rating can be used to shape traffic and user behavior and that perhaps users should determine the entire Internet experience, they want to turn this consumer victory into a defeat. But this basic consumer protection is long overdue having only taken this long because of former FCC Chairman Ajit Pai’s decision to abandon net neutrality and terminate investigations into AT&T’s unlawful practice in 2017, which prompted California to pass S.B. 822 in the first place.

Competition among video streaming services is fierce and should be protected and enhanced. User-generated content on things like Twitch and YouTube, premium content from Netflix, Disney+, or Amazon Prime are all competing for your attention and eyeballs. AT&T wanted to give HBO a leg up by simply making the other services either more expensive via a data cap or to have them pay AT&T to be exempt so even if you were not watching AT&T’s product, money was coming to them. Such a structure makes is impossible for a small independent content creator to be competitive as they lack the resources to pay for an exemption and would need to provide content compelling enough for AT&T customers to pay extra to watch.

Furthermore, as the study discovered, it took a lot of resources from Internet companies to obtain a zero rating exemption making it something only the Googles, Facebooks, and similarly large Internet companies could regularly engage in but not medium to small companies. AT&T doesn’t mind that because it just means more ways to extract rents from more players on the Internet despite being fully compensated by users for an unfettered Internet experience.

Despite AT&T trying to brand this as a loss for consumers, this is actually a win for everyone. ISPs can no longer try to double-dip by charging both the customer and the creator for access. Smaller creators can compete in an open Internet market along with the bigger players without data cap disadvantages. Consumers get more choice in what they can and cannot see online (in this case, being strongly encouraged to funnel into AT&T controlled services).

What AT&T did was confirm some of the worst fears open Internet advocates had about the repeal of network neutrality. Given that ISPs continue to buy up media companies and control even bigger parts of the market, the need for network neutrality laws became more and more necessary over recent years. California ultimately put a stop to that for residents – at least on a temporary basis. With Jessica Rosenworcel now heading the FCC, it increasingly looks like disaster is going to be narrowly averted for American Internet users.

Drew Wilson on Twitter: @icecube85 and Facebook.

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