updated 10:31 am EST, Thu January 9, 2014
Plan for data allowances paid for by content providers to face scrutiny
The Federal Communications Commission (FCC) may look into how AT&T conducts the "Sponsored Data" program it introduced earlier this week. The FCC Chairman, Tom Wheeler, reportedly expressed concerns that the plan to allow content providers to pay for data used by customers over the carrier's cellular network could be anticompetitive.
When asked about the program, Wheeler advised "My attitude is: let's take a look at what this is, let's take a look at how it operates," reports The Verge. Wheeler warns that if it "interferes with the operation of the Internet; that if it develops into an anticompetitive practice; that if it does have some kind of preferential treatment given somewhere, then that is cause for us to intervene."
FCC Chairman Tom Wheeler
AT&T's plan would allow businesses to cover the cost of whatever data is used by carrier subscribers to access their service, in order to avoid using any of the subscriber's data plan allocation. Despite the effectively-free nature of the plan, it would only be open to post-paid subscribers of AT&T and not prepaid customers, will only be useable on AT&T's US network, and depending on the nature of individual sponsorships, could be limited to HSPA+ and LTE traffic.
Potentially, this could lead to a situation where the larger online services will pay for user data allowances, keeping subscribers away from start-ups that cannot possibly compete with their smaller budgets.