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What’s The Deal With T-Mobile And Net Neutrality?

James Tyner |
November 10, 2015 | 9:41 p.m. PST

Staff Reporter

T-Mobile CEO John Legere mingles with T-Mobile and Metro PCS employees outside of Shrine Auditorium before the Uncarrier X event on Wednesday, where the company announced “Binge On,” among other things. Photo courtesy of T-Mobile.
T-Mobile CEO John Legere mingles with T-Mobile and Metro PCS employees outside of Shrine Auditorium before the Uncarrier X event on Wednesday, where the company announced “Binge On,” among other things. Photo courtesy of T-Mobile.
When T-Mobile announced Music Freedom — unlimited music streaming not subject to data caps — customers rejoiced. As the company puts it, T-Mobile is “setting music free.” The company was at it again on Tuesday when it announced Binge On, which extends free streaming to a variety of video services.

But while these offers may appear highly enticing and consumer-friendly, they have a darker side — and it has to do with something called net neutrality. Let’s dive in.

What is net neutrality?

In a neutral Internet, all service providers treat all Internet traffic equally. No special treatment, no paid “fast lanes,” no discrimination. The Internet ran on this principle for years.

The following passage by Vox writer Timothy B. Lee illustrates the importance of the concept clearly:

When Mark Zuckerberg created Facebook in his Harvard dorm room, he didn’t need to ask Comcast, Verizon, or other internet service providers to add the site to their networks. He also didn’t have to pay these companies extra fees to ensure that Facebook would work as well as the websites of established companies. Instead, as soon as he created the Facebook website, it was automatically available from any internet-connected computer in the world.

That’s network neutrality.

Net neutrality was essentially entrenched in the foundation of the Internet for decades until a 2005 Supreme Court ruling decided that broadband Internet was an “information service” rather than a “telecommunications service.” This is an important distinction, as telecommunications services (e.g. landline telephone companies) must provide equal service to all customers (they act as “common carriers”). Information services don’t have that rule.

The ruling led to the perversion of a neutral web. For example, Netflix reached a deal with Comcast in 2014 wherein Netflix paid Comcast to ensure that its video streams would be delivered reliably to Comcast customers. Netflix made a similar deal with Verizon just months later. Netflix claimed that the speed of its video delivery had declined by 25 percent before the deal.

Net neutrality advocates argued that such an agreement violated net neutrality principles and would be bad for consumers in the long-run. If one service receives preferential treatment when it comes to Internet traffic, that by extension means all other services receive worse treatment. (To be clear, Netflix was not paying for prioritization in content delivery, but instead for direct access to Comcast and Verizon subscribers. However, this still would not be available to a firm that did not pay for the privilege.)

In early 2015, the Federal Communications Commission categorized broadband Internet as a public utility, signaling the return of net neutrality principles. Chairman Tom Wheeler said at the time that access to the Internet was “too important to let broadband providers be the ones making the rules.”

What does this have to do with T-Mobile? 

At the Shrine Auditorium in Los Angeles on November 10, T-Mobile CEO John Legere announces Binge On, a service wherein T-Mobile customers can watch unlimited amounts of video from approved streaming services. Photo courtesy of T-Mobile.
At the Shrine Auditorium in Los Angeles on November 10, T-Mobile CEO John Legere announces Binge On, a service wherein T-Mobile customers can watch unlimited amounts of video from approved streaming services. Photo courtesy of T-Mobile.

It’s not immediately clear whether T-Mobile’s Music Freedom and Binge On programs violate principles of net neutrality. Music and video streaming services pay nothing to T-Mobile to be included in the plans, and the company claims that any service will be included upon request if technically possible. Plus, T-Mobile’s offerings are very much pro-consumer, providing greater benefit at no extra cost.

The potential danger of what T-Mobile has done is called “zero rating.” It’s a common practice in impoverished nations where carriers provide access to certain services at no cost. In the U.S., AT&T’s version of zero rating is called Sponsored Data, in which, for example, “an app startup could temporarily exempt its newly launched app from all download and usage data charges in order to encourage more AT&T customers to try it out.”

The danger of zero rating is clearly illustrated in this example from Susan Crawford, a net neutrality activist:

Can you imagine trying to launch a competitor to Facebook in a country where most of your potential customers will have to pay data charges for your service — while the incumbent Facebook is exempt?

T-Mobile CEO John Legere argued at the Binge On announcement event that “This is not a net neutrality problem. This is similar to Music Freedom. It’s free!” The company attempts to skirt the neutrality issue by allowing any music or video service to be exempt from data caps. But that service still has to get approval from T-Mobile, who ultimately has final say.

It’s telling that YouTube is not included in the initial set of video streaming services including in Binge On. Likely, this is because T-Mobile wishes to avoid the ill network effects of unlimited YouTube streaming, which could be highly popular. But the company can’t both exclude YouTube and claim to be net-neutral. 

Since 2015, the FCC has the power to regulate net neutrality, including mobile broadband. But since Music Freedom and Binge On are a boon for consumers, it’s not clear if any actions will be taken to change T-Mobile’s ways.

It’s really an issue of principles versus practice. And in practice, free stuff is pretty sweet.

Disclaimer: The writer of this piece is a T-Mobile customer.

Reach Staff Reporter James Tyner here or on Twitter @jamestyner_



 

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