How to Deal with Data Caps, Sponsored Data and Zero-Rating

The Federal Communications Commission adopted its landmark Open Internet Order nearly a year ago. In this the agency made the correct decision to again treat broadband as an essential telecommunication service. But as of February 2016, the rules and the reclassification itself are subject to a court challenge, with a decision due in the next few months. The FCC’s rulings are in effect as the case wends its way through the courts, but wired and wireless broadband providers like Comcast, T-Mobile, AT&T and Verizon are taking advantage of the waiting period to test a series of new pricing and data schemes that harm Internet users and rightfully worry Network Neutrality proponents.

Those big Internet service providers have announced a series of changes to their data-cap policies and have also introduced exemptions to allow their respective customers to get out from under those caps. These schemes differ from each other in some ways, but they have one thing in common: Without the arbitrarily low and punitive data caps some ISPs impose on their customers, these exemptions wouldn’t be a problem. They wouldn’t even exist. You don’t need an exemption if there’s no bad cap. And the ISPs’ eagerness and ability to provide exemptions from their own artificial limits shows they have little or no relationship to the underlying cost of connectivity or network management. Net Neutrality defenders and advocates for broadband users are concerned about the implications of these caps and arbitrary exemptions. The principles in play are clear, and the stakes are high: The open Internet must stay open, and Internet access must be more affordable. This issue brief describes the proposals the major companies have put forward and prescribes the best policies to address them.