Federal Communications Commission (FCC) Chairman Tom Wheeler speaks as audience watch (Photo : Getty images/ MANDEL NGAN / Staff)
Verizon and AT&T have replied to letters from the Federal Communications Commission (FCC) that disputed the companies' sponsored data plans are hurting consumers and the open market.
The Verge reported that FCC has been criticizing zero-rating plans. The companies safeguarded the programs, that allow select data sources to avoid count toward customers' data plans through a process called as zero-rating. While it did not positively ban it in new net neutrality rules prescribed last year, the FCC has been criticizing such programs, contending that these can be used to hurt competition by unfairly favoring some data, building an uneven playing field for businesses.
In a notable pointed response, AT&T is taking a similar line to the position it's held all along: programs like Data Free TV which permits customers to use the benefit of data from AT&T-owned DirecTV without it accounted toward a plan, are not anticompetitive while being a perk just consumers enjoy.
Wall Street Journal reported that the FCC primarily built its concerns with AT&T, the day after the presidential election. AT&T answered with a detailed defense that did not satisfy the regulator. Ajit Pai, the Republican FCC Commissioner criticized the reply in a statement highlighting the Congress's call to desist controversial decisions.
"This end-run around Congress's clear instruction is sad-and pointless," Ajit Pai says observing that any unilateral action "can quickly be undone" afterwards the Presidential inauguration on Jan. 20.
The FCC's letter to Verizon notes that the carrier's steps have "the potential to hinder competition and harm consumers." Verizon omits data charges to its wireless customers for its National Football League games or its go90 mobile-video app.
"We remain quite confident that our practices are good for consumers, non-discriminatory and are consistent with current rules," Verizon says.
The agency petitioned both companies to respond by Dec. 15, and this includes a list of detailed questions for AT&T.
AT&T stated that other video providers can also remit to cover data costs for own customers at the fixed rates as its DirecTV subsidiary. Verizon tenders a matching program.
The FCC calculates that an outside video provider will have to pay AT&T $16 a month for each customer who used 10 minutes of streaming video a day, coming to $47 a month for a customer using 30 minutes a day.
