Wolverton: Comcast tests FCC’s resolve, rules on net neutrality

With the Federal Communications Commission’s strong new net neutrality rules under attack in the courts and by particular business plans, it should come as little surprise that one of the main companies at the center of the ongoing struggle is Comcast.

The broadband giant has played a key role in the net neutrality debate over the last decade, serving as both an obstacle to the FCC’s efforts to require an open Internet and a symbol of the dangers of a world without one. And now that those rules are in place, Comcast is offering perhaps the most important test of their limits with a streaming video service called Stream TV.

Comcast has designed Stream TV to take advantage of a loophole in the net neutrality rules, a move that could allow it “to get a free pass to violate net neutrality,” said John Bergmayer, a senior staff attorney at Public Knowledge, a consumer advocacy group that pushed the FCC to adopt its open Internet rules.

In my column on Monday, I wrote about the threat to net neutrality from so-called zero-rated programs. These are broadband plans that allow users to access particular sites, services or apps either for free or without having to tap into any of their limited monthly data usage. Broadband providers have been rolling out a growing number of zero-rated services in recent months, and a particular one — T-Mobile’s Binge On program — has been under fire lately.

Critics — including yours truly — argue that zero-rated programs undermine net neutrality by allowing broadband providers to pick winners and losers online. They also shift the marketplace away from the sites and services that have the most inherent consumer appeal and toward those backed by companies with connections to the broadband providers or the most resources to pay for their favor.

It was just these sorts of concerns that led regulators in India on Monday to ban Facebook’s Free Basics service, a zero-rated plan that allows consumers to access Facebook and a smattering of hand-picked sites — but not the entire Internet — for free.

Unlike its counterpart in India, the FCC has declined to bar zero-rated services despite acknowledging their potential problems in its open Internet rules. Worse yet, it left open in those rules a large loophole for a particular class of zero-rated services like Stream TV.

Like others zero-rated services, Stream TV, which offers consumers a limited set of broadcast and cable channels via a smartphone or tablet app, doesn’t draw down users’ monthly data allotment. What makes Stream TV distinct from other such services is Comcast’s contention that the reason Stream TV is treated differently is because it’s completely separate from broadband access and isn’t delivered over the Internet at all.

“It never touches the Internet,” said Sena Fitzmaurice, a vice president of government communications at Comcast. “It uses a totally different infrastructure.”

That assertion is crucial for Comcast. In crafting its open Internet rules, the FCC was careful to tailor them so that they would allow telecommunications companies to be able to continue to offer pay TV and traditional phone services that aren’t governed by the rules, even if they are being delivered in digital fashion using Internet protocols. The key is that those non-broadband services must be kept separate from general Internet traffic and not involve the provision of Internet access.

As I and other critics pointed out last year, that left a big potential loophole for broadband providers. The rules would allow — even encourage — them to segment their data lines, carving out portions over which they could deliver services that compete with Internet-delivered services but that wouldn’t be subject to the net neutrality rules.

That’s pretty much what Comcast has done with Stream TV. The service works a lot like Dish’s Sling TV offering: It’s a digitally-delivered pay TV service that offers live programming. It just doesn’t count against users’ data caps.

Just as with Sling TV, Stream TV isn’t available via a traditional cable set-top box. Instead, subscribers access the service through a Web site on their computers or via an app on their smartphones and tablets. In Stream TV’s case, subscribers use the same Xfinity TV Go app that they would use to stream on-demand TV shows or movies.

And just as with Sling TV, consumers can’t access Stream TV without Internet access. Indeed, in Stream TV’s case, they specifically need access from Comcast.

In other words, the supposed technical reasons that Stream TV stands apart from Sling TV — or Netflix or Hulu — and ought to be treated by Comcast the same way aren’t at all obvious to end users.

“It works exactly as Netflix from the customer perspective,” said Bergmayer. “The only difference from a customer perspective is one counts against their data cap and one doesn’t.”

Comcast’s Fitzmaurice disputes the idea that there are few differences between Stream TV and Internet-delivered streaming services. Unlike Sling TV, Stream TV subscribers customers can only access the live programming part of Stream TV inside their homes, she said. And Comcast is treating the service, which right now is only available in a handful of areas, including Boston and Chicago, as the equivalent of a traditional pay TV service, she said. Just as it would with a traditional cable TV subscription, Comcast pays franchise fees on Stream TV subscriptions, makes closed captioning of shows available to subscribers and offers the same public access and educational channels through it that are mandated for local pay TV services.

“It’s just like a cable service,” Fitzmaurice said.

What’s more, Fitzmaurice said that while Comcast doesn’t yet offer Stream TV as a standalone product separate from broadband, there’s “no technical reason” why it couldn’t.

“For a customer who receives no other Comcast services, we have to provide a piece of standalone equipment to receive the Stream TV signal,” she said, adding that Comcast is “working on” developing just such an offering “and hope(s) to have (it) available soon.”

But these distinctions seem less important that Fitzmaurice would have us believe.

Whatever Comcast may have in the works, the fact is that consumers can only get Stream TV right now if they have a broadband subscription. Even if customers can’t access live programming outside the home, subscribing to Stream TV gives them access to a significant amount of on-demand content through the same app when they aren’t home.

And as for Comcast treating Stream TV as a cable service, Fitzmaurice couldn’t point to any public documents that corroborate that statement. Comcast may indeed be treating Stream TV as a cable service, but there doesn’t seem to be anything on the record — either with the FCC or with local municipalities — that shows it is.

For those reasons as well as those listed above, Stream TV, for all intents and purposes, looks like any other online video service — just one that’s been intentionally tailored to try to circumvent the net neutrality rules.

Comcast’s design and intent with Stream TV is similar to — but the inverse of — AT&T’s move a decade ago to convince the FCC to exempt its long distance service from the traditional telephone regulations, said Barabara van Schewick, a professor at Stanford Law School. The telephone giant argued that because it was routing long distance connections in part over the Internet, they were no longer traditional calls and shouldn’t be subject to the same rules. The FCC rejected that argument, van Schewick noted.

The agency said “you can’t turn traditional phone service into an information service by sprinkling a bit of IP (Internet protocol) pixie dust over it,” she said. Similarly, she argued, “You can’t turn an IP service into a (non-Internet) service by saying, ‘I’m running it over my own infrastructure.'”

The danger of allowing companies like Comcast to skirt around net neutrality rules in this way is that it would encourage Comcast and other broadband providers to give these set-apart data services unfair advantages over those that went over the regular Internet. Just by having their own dedicated segment of the data pipe going to users’ homes, they wouldn’t be subject to the same congestion as standard Internet services. And the broadband providers could tilt things even more in favor of their own services by artificially restricting the bandwidth available to general Internet services while giving their competing, supposedly non-Internet delivered ones ample capacity.

The FCC tried to placate critics of this loophole by saying in its open Internet order that it would keep an eye on broadband providers non-broadband services. It also warned that it could intervene if those services threatened the open Internet.

But that feels like a hollow threat, because this isn’t the first time that Comcast has challenged net neutrality rules in this same way. The company in 2012 launched an app for Microsoft’s Xbox 360 video game console that allowed owners of the device to watch on-demand video from the cable giant through their broadband connection.

Just as is the case with Stream TV, video watched through the Xbox 360 app didn’t count against viewer’s data allotment. Despite complaints from Netflix and consumer advocates — and the fact that Comcast had agreed to adhere to net neutrality rules as a result of its merger with NBC-Universal — the FCC declined to intervene.

As that incident indicates, Comcast has played a long-running and central role in the struggle to put in place strong and binding rules to preserve the Internet’s open nature. Comcast’s throttling of BitTorrent traffic last decade led to a court case that overturned the FCC’s first set of net neutrality rules, which in turn spurred the agency to re-craft those rules so they rested on a firmer foundation.

Comcast’s agreement to adhere to net neutrality rules helped convince the FCC to approve its NBC-U merger. Conversely, concerns about the impact on the Internet’s open nature helped lead to the agency’s decision last year to thwart Comcast’s merger with Time Warner Cable.

 

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  • eat naders

    The government needs to remove themselves from the equation totally. They should have no say in how the internet is used nor how it is managed. This will stifle innovation in the long run. Way to go Comcast. Push them up against the wall, the courts will eventually rule in your favor as the FCC has no business stinking their noses into the realm of the Internet.

    • Change Me

      Not true , Who else do you think is going to control Comcast Greediness ,Comcast is terrible …..Wise up dude…….
      Comcast Cable greediness is a sickness !

    • Funktapus

      When it comes to wireless internet, the FCC absolutely does have the right to regulate what companies do. The FCC created a protected wireless spectrum and leased pieces of it to private companies with the stipulation they would abide by FCC regulations. Those regulations can include consumer protection.

      Same goes for the internet at large, but its a more complex situation. The internet is very heterogeneous and owned by a lot of different companies. But it relies on standards that are enforced by the US and international governments. Furthermore, ISPs enjoy lots of privileges granted by the government, including being able to operate local monopolies, in exchange for following certain rules. The courts are not going to hand over completely control of our nations information infrastructure to a handful of private companies any more than they would do the same for our roads or electricity. Private companies can enter the mix but they have to follow the rules.

  • Steve_S

    I find it hard to argue strictly on Comcast offering a private IP service to their customers. Where there might be an argument is that due to the nature of their network (shared bandwidth between users) they are depriving adjacent users of full network access.
    Eat Naders When companies that have been given monopoly privileges (utilities) conspire to interfere with unrelated entities ability to transact commerce and simultaneously are opaque and arbitrary with their customers then yes government has a role to play. On the other hand allowing an entity with the power of the sword to violate constitutional rights is another matter. This is clearly the former not the latter.

  • Funktapus

    This is a tricky one. Comcast’s television channels and internet packets both go through the cable jack, so its entirely possible that Stream TV can be identical to cable TV by the time it leaves the customer’s home (whether it currently is, I don’t know). In this case, the use of a web browser+computer+router+modem is just an alternative to a cable box, which is something the FCC is pushing for anyway (letting the customer access cable channels on any hardware they please). In that regard, Comcast is completely justified in saying this is not an internet service and doesn’t compete directly with Netflix and the like.

    On the other hand, they do require people to have a Comcast internet connection to use Stream TV. I think its arguably OK for Comcast to require *some sort* of internet to use Stream TV, as it’s probably essential for for the customer’s local network to function properly (though some odd exception may conceivably exist) and a convenient way to integrate the service with a web browser. However, it’s anti-competitive to require that internet connection to be from Comcast. If the customer has internet connectivity provided by a cable alternative (e.g., fiber or wireless), and some sort of device that connects their cable jack to their local network (basically a cross between a modem and cable box), then they should be able to access Stream TV.

    If the FCC succeeds in their recent effort to force the “cable protocol” open in consumer’s homes, then this hypothetical device may be common, and zero-rated Stream TV would be completely defensible IMO. The way things are going, all data in a person’s home will be hosted on the same local network, so cable TV doesn’t magically become internet just because it traverses the router.

 
 
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