How Mobile Carriers Skirt Net-Neutrality Rules

“There’s something stomach-twisting about a company offering free video streaming but charging for the data used when filling out an online job application.”

Shannon Stapleton / Reuters

One of the most unfortunate misnomers of The Cloud as a metaphor for describing an increasingly networked society is not only that it perpetuates a fiction of an intangible system—but also a fiction that everyone experiences that system in the same way.

The ubiquity of The Cloud in daily life is in large part due to the ubiquity of networked devices in everyday life. According to research by the Pew Research Center, nearly two-thirds of all Americans own smartphones. Although cables are still the foundational backbone of the network, more and more U.S. connectivity happens wirelessly, across cell networks run by mobile carriers.

Most people see or experience little distinction between mobile Internet and the Internet accessed on a laptop or desktop computer—at the end of the day, it’s all just data. But at least as far as net-neutrality regulations went, for a long time the mobile, wireless Internet was an entirely different animal from the wired one.

In 2010, when the Federal Communications Commission first approved net-neutrality rules, it exempted mobile networks. The most recent changes to net-neutrality rules explicitly stated that mobile services should be covered under the same classification as wired broadband, given that “mobile broadband Internet access service is interconnected with the public switched network.” The FCC has given this reclassification teeth: In June, they fined AT&T $100 million for throttling users on unlimited data plans. But in the months since the FCC issued the rule changes, several mobile carriers have begun introducing services that seem like blatant challenges to the entire premise of net neutrality.

Of course, these services aren’t marketed that way, and they take advantage of a neat loophole in the language of the FCC’s Open Internet rules. The current term of art among mobile companies has been zero rating, or sometimes sponsored data. It basically means that using certain applications and services doesn't apply to a user’s data plan, while others do.

It’s unclear where zero rating as a concept first took hold, but it seems like a lot of it goes back to work by Facebook’s initiative. The earliest manifestations of what is now known as’s Free Basics program were apps like Facebook Zero and Wikipedia Zero. The logic presented to carriers offering these early zero-rated apps was essentially that by offering these “free” apps to users, they’d be enticed to pay for data later (which sort of ignores the fact that users of zero rated services are presumably already poor, but OK). Following criticism of the platform from net-neutrality advocates, the Free Basics platform now allows third-party developers to build apps for the platform, rather than curating it to selected partners.

Given the amount of criticism received for their zero-rating schemes, it’s kind of surprising how unabashedly U.S. carriers have been rolling out and experimenting with similar plans. In 2014, Sprint offered an Unlimited My Way plan that offered users $12 per month data plans that offered limited data—but free data on either Facebook, Twitter, Instagram, or Pinterest. Verizon has announced that they’re experimenting with sponsored data; so has AT&T. More recently, T-Mobile debuted a new zero-rating service (known as the Binge On Plan, a name somehow equal parts bacchanalian and depressingly banal) which offers free streaming of services like Hulu, Netflix, and HBO Go, among others.

It really seems too obviously out of line to be true—mobile carriers are literally partnering with large media companies to subsidize data-devouring streaming services, while what might be considered the “open Internet” remains a paid service (and, considering the amount of data consumed by advertising alone, a lot of users are paying to view stuff they actually don't care about at all). Binge On sounds like a marketing slogan out of Infinite Jest, but it’s not technically illegal for brands to emulate literary dystopias and for now, zero rating isn’t technically violating net-neutrality principles. The FCC’s Open Internet rules cover a lot of issues, but they don't explicitly ban zero rating. And it’s unclear whether they will. The FCC chairman Tom Wheeler recently described T-Mobile’s Binge On plan as “highly innovative.”

Creating these gatekeeping systems has material consequences for how people experience and perceive the Internet. That same Pew Research Center report that determined over two-thirds of Americans own smartphones also noted that around 15 percent of those Americans have limited access to high-speed broadband beyond their phone’s data plan, and 10 percent only had access to high-speed broadband via their smartphone. There’s something really stomach-twisting about T-Mobile offering free video streaming but charging for the data used when filling out an online job application or, say, sending video of inappropriate police conduct to the ACLU.

This isn’t to say that it necessarily is realistic or makes sense to return to the halcyon days of genuinely unlimited, unthrottled data plans for all. At the end of the day, the transmission of data does translate back to raw commodity resources, and someone does have to pay for them. Even if all our telecommunications infrastructure runs on renewable energy and is made from perfectly cradle-to-cradle manufactured hardware, it will still have a cost. In a weird way, data caps are among the few ways of reminding people that there are material constraints on technologies that have been sold to them as infinite and limitless.

But zero-rating for streaming services doesn’t make the material limitations of data use manifest; it makes them someone else’s problem and it makes access to online audiences a pay-to-play game. It’s data plans as sales of indulgences. Unfortunately for the general public, the FCC’s Open Internet rules are not quite a 95 Theses nailed to the door of mobile broadband.