AT&T’s Self-Dealing Data Caps Threaten Net Neutrality, Affordability and Choice

WASHINGTON — On Wednesday, several news outlets reported that AT&T now exempts satellite company DIRECTV’s online video content from the data caps for AT&T Wireless customers. AT&T acquired DirecTV in a $48.5 billion deal in 2015.

Since then, AT&T has made several efforts to tie DIRECTV subscriptions to its broadband-data offerings — by making unlimited wireless data available only to people who pay for a DIRECTV or AT&T video subscription. Similarly, AT&T offers uncapped home internet plans only to DIRECTV or AT&T video subscribers — in ways that skirt the protections the FCC crafted in the merger conditions to protect against such behavior.

Free Press Policy Director Matt Wood made the following statement:

“AT&T is using its latest data-cap exemptions to prop up its satellite-TV business by disfavoring the competitive and diverse video choices people have online.

“AT&T may claim it’s making use here of so-called sponsored-data plans, and letting DIRECTV pay for data the way it would let any video content provider pay. But even with accounting maneuvers to make it look like DIRECTV pays, there’s every reason to be skeptical of just how fair such self-dealing could be. The money flows from one pocket to another but it all stays in AT&T’s coffers. As such, there’s zero reason to trust without verification that the same terms are available to everyone on reasonably nondiscriminatory terms.

“Tying broadband and legacy pay-TV subscriptions together like this is a huge problem. With these schemes, AT&T seems intent on favoring its own video content under the DIRECTV brand. That harms both diverse content creators and internet users who already pay so much for their wireless service. This isn’t really free data. It’s a way for AT&T to keep you paying for two services instead of one, and a roadblock designed to prevent you from using your data on any content AT&T doesn’t own.

“The anti-competitive implications for the video market are clear as a bell. Locking internet users into old-fashioned pay-TV subscriptions, or even steering them toward those subscriptions and toward the broadband providers’ own video content, may be great business for AT&T. But it’s a bad deal for internet users and competing content creators.”