TC Scottek

Nov 28, AT&T made a dim prophecy official by announcing that its new DirecTV Now streaming service would be zero rated: it won’t count against its customers’ data caps. Zero rating isn’t new — T-Mobile has been writing the manual on how to get away with it — but now it’s finally happening at a scale that matters. And AT&T’s version is much worse than T-Mobile’s.

AT&T’s zero rating model is pretty much the nightmare scenario that Internet advocates and pro-competition observers have been warning us about. That’s because AT&T owns DirecTV, and is now giving DirecTV Now privileged access to AT&T’s wireless Internet customers. The corruption is so obvious here that it doesn’t need a fancy network neutrality metaphor — AT&T is clearly favoring a company it now owns over competitors. And that’s just the beginning of where AT&T is screwing us. The company stands to reap massive tolls on the other end of that “most favored nation” deal with DirecTV, because it also offers something called “sponsored data” to other companies that want the same kind of privileged access to AT&T customers. So, for example, if Netflix wants to compete fairly with DirecTV, it would need to pay AT&T to exempt its video traffic from data caps. This is what Internet service providers really want the Internet to look like: a bundle of premium services that run up the cost of access to their networks.