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Chile Bans Letting Some Apps Bypass Data Caps
by Karl Bode 12:33PM Tuesday Jun 17 2014
At this point in the net neutrality debate, most ISPs aren't interested in inviting tougher neutrality rules by engaging in heavy-handed anti-competitive behavior, so you'd be hard pressed to see any ISP do something egregiously stupid -- like banning a website or service. Still, the FCC's rules focus heavily on outright website blocking knowing ISPs won't protest them -- since they never intended to do that sort of thing in the first place.

What we are starting to see is more clever abuses of gatekeeper power -- like the recent interconnection feuds or AT&T's sponsored data, which charges companies a fee if they want their data to bypass the cap. That's a dangerous precedent because it puts AT&T In the position of picking winners and losers, with smaller companies in particular potentially unable to pay to have their apps on equal footing with giants like ESPN.

Letting some apps bypass the cap isn't all that common here yet, but as we've seen oversees, Google, Facebook and carriers have experimented with offering some access to some content without hitting the cap (check out Facebook Zero and Google Free Zone). For the first time I've seen (at least with this level of specificity), Chile has now moved to ban such practices:
quote:
The Chilean telecommunications regulator Subtel has banned mobile operators from offering so-called zero-rated social media apps -- services like Twitter and Facebook that, through deals with the carriers, can be used without having to pay for mobile data. Subtel says such practices are illegal under Chilean net neutrality law.
While superficially and instinctively many users who don't see the big picture will say they want to get free access for some apps, Glyn Moody at Techdirt does a nice job explaining that they'd be wrong (if they value an open, competitive Internet and content ecosystem):
quote:
That might seem perverse, since it means that Chilean mobile users must now pay to access those services, but it is nonetheless exactly what governments that have mandated net neutrality need to do. That's because providing these services for free makes it much harder for newcomers -- specifically new services from local startups -- to compete with established ones that are provided free. Indeed, it's striking how Facebook, for example, has kept its head down during the net neutrality debates -- doubtless conscious that it has benefitted hugely from these schemes that run counter to net neutrality principles.
So far Wheeler and the FCC have (surprise, surprise) seemed a little tone deaf to the threat posed by AT&T charging companies fees to bypass the cap (and therefore get priority listing), though there's still time to comment to the FCC to make sure they better understand the issue.

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jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1

1 recommendation

Wheeler's Main Goal is Paid Priority Access

I'm convinced this is why Wheeler was put into the position he is in. The big carriers are looking to get paid priority access into play, and this is the man to make it happen.

»www.washingtonpost.com/blogs/the···nternet/
Mr Matt

join:2008-01-29
Eustis, FL
kudos:1
Reviews:
·Millenicom
·Embarq Now Centu..
·Comcast
·CenturyLink

Does that mean Toll Free telephone numbers should be banned?

On one hand it seems unfair to allow websites to pay for users traffic, giving them a competitive advantage. On the other hand a company like Netflix or Amazon.com have a lot more leverage to negotiate better rates for their customers than end users can. Including usage cost in the price of the service would be better for customers. Website pays would eliminate the need for CAPS since the ISP's will receive compensation for the cost to upgrade their networks to carry additional traffic, for example streaming services. Unfortunately it will probably be necessary for government to establish regulated rates based on impact on the ISP's network if unregulated price negotiations is unsuccessful in providing fair pricing for websites.

jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1

Re: Does that mean Toll Free telephone numbers should be banned?

Small businesses can, and often do, utilize toll free telephone numbers.

The biggest concern comes from how the carriers will charge for these apps to be able to bypass data caps. If the prices are lower based on the number of apps installed on devices or by subscriber numbers, this could be anti-competitive for smaller businesses.

Facebook might get a significant discount because of its popularity and widespread app usage. It may cost only a dime per app used if 50 million apps were installed, making it a $5 million dollar fee.

A smaller company with an app that is only installed on 50,000 devices might not get a similar discount and have to pay $1 per app to bypass the data caps. A smaller business may not be able to pay $50,000 dollars when charging .99 cents for the app, and the carriers can simply keep the smaller competitors separated from the established giants.

The same problem would apply for a flat rate fee. If AT&T charged $5 million to bypass data caps, Facebook would be ok with that, while smaller app developers would not be able to afford this fee and they could not compete on even terms.

Innovation will be dead.

Discounts

@50.182.54.x

Re: Does that mean Toll Free telephone numbers should be banned?

said by jmn1207:

Facebook might get a significant discount because of its popularity and widespread app usage. It may cost only a dime per app used if 50 million apps were installed, making it a $5 million dollar fee.

A smaller company with an app that is only installed on 50,000 devices might not get a similar discount and have to pay $1 per app to bypass the data caps.

Innovation will be dead.

Most customers don't care about innovation - IF they get lower prices from established players.

And there is a good reason the very big customers get volume discounts. It is cheaper for a Comcast to deal with 1 big client than it is to deal with 500 smaller ones.

ieolus
Support The Clecs

join:2001-06-19
Danbury, CT
Is the Internet a packet-switched telephone network?

If ISP caps are for "network management" and to help with "web hogs", how does an ISP justify certain apps that can bypass the cap?
--
"Speak for yourself "Chadmaster" - lesopp

Flyonthewall

@206.248.154.x

Re: Does that mean Toll Free telephone numbers should be banned?

Because they got paid to do it. No money, no honey...pretty simple.

fg8578

join:2009-04-26
Salem, OR

Chile Bans Letting Some Apps Bypass Data Caps

Chilean government: "In order to help end users, we first have to hurt end users (especially the poorest). And we also know what's best for you, even better than you do. So trust us, we're from the government, and we're here to help. "

fiosultimate

join:2014-06-09
San Antonio, TX

Re: Chile Bans Letting Some Apps Bypass Data Caps

Obama is president of Chile too?? Sounds like it

nothing00

join:2001-06-10
Centereach, NY

Another job killing policy

Job Killers.

MxxCon

join:1999-11-19
Brooklyn, NY

Re: Another job killing policy

orly?

flwpwr

@67.160.90.x

in other news

»www.pcworld.com/article/2364722/···ine.html

Apparently someone is introducing a bill that says some stuff is illegal for private providers to do for internet access...