Exempting popular apps from data charges is anti-competitive

I really like T-Mobile's program since a lot of my data usage was disappearing into streaming music (namely Google Music/Play Music). However I will fully admit it is anti-competitive since if you're a new music streaming service just trying to make it, you won't get onto T-Mobile's free list (and even Google Music/Play Music wasn't until extremely recently, like even two months ago it wasn't).

However as much as I like and benefit from this program, I think the world would be a better place if all data was treated equally. I'd actually be willing to sacrifice this program if it meant a more fair internet, and I benefit from it...

In theory, Music Freedom is a way to have all streaming music traffic not count toward your data cap. If that's the case, T-Mobile is discriminating based on the type of traffic, but not the origin of the traffic. Generally speaking, network management and traffic shaping aren't being fought against by net neutrality campaigners. It makes sense that VoIP traffic receive higher priority than FTP because if my FTP transfer takes another 10 seconds out of 5 minutes I'll hardly notice, but if my voice traffic stutters, I will certainly notice.

In many ways, Music Freedom is an extension of this to bandwidth caps. Streaming music is low, consistent bandwidth usage, but not real-time. By contrast, loading things on the web is high bandwidth usage, but quite spiky. As a carrier and as a user, it would make sense to reschedule music packets around web packets. If the next 15 seconds of the song are already in your local buffer, you'd much rather it wait until you're idle in your browsing session than slow down your browsing - so long as the next second of music is delivered less than 15 seconds from now.

If T-Mobile were simply managing its network this way, I don't think anyone would have a problem with it. Music lovers wouldn't notice that things were being scheduled for more idle times in the network and web users would see faster speeds. That's simply an equal or better outcome for everyone.

Traffic shaping is a good thing. My university has a wonderfully progressive IT department and didn't want to block anything. However, out of 5,000 users, the top 50 users use half the bandwidth. Again, the university doesn't mind that. Most of the time it doesn't matter. However, they didn't want students trying to do research to have their relatively low-bandwidth web traffic stifled by students file sharing and so web traffic was given greater priority than file sharing. The university didn't want to block file sharing, but I think a lot of people would recognize that large file transfers are not as time-sensitive as interactive processes.

Some people suggest that all data be treated the same. I don't think that's the answer. Some traffic needs more real-time guarantees than others. That's very different from discriminating based on the source/destination of the traffic.

But T-Mobile is applying this to data caps (or throttling points). I'm going to argue that (on an intelligently designed system) using 1GB of streaming music is less network usage than downloading a 1GB file. What do I mean by less network usage? I mean that the streaming music usage impacts other users on the same connection less. For a simple example, let's say that you're browsing the web and I'm streaming 256kbps music over a 512kbps connection. Are we both using half of the connection? No. When browsing the web, you have peaks and valleys in your data transmission. To make things simple, let's say that every time you click a link you download 64KB or 512kbits. If I'm using half the connection, it takes 2 seconds for you to download. But that's not very efficient. I already have the next few seconds of the song in my buffer so it makes more sense for me to drop down to 0kbps for a second, you to complete your download in 1 second, and then for me to download 2 seconds of song in the second after your download completes. I have not seen any degradation of my service - I'm oblivious to it happening. Downloading the song faster doesn't help me, but you downloading your web page faster does help you.

So, by being able to reschedule streaming music around other traffic, it actually uses less of the network capacity during the periods when there is contention. In total, it uses the same amount in terms of MB or GB transferred. However, you don't care how much of the connection I'm using when you're not using it. You only care how much I'm using while you want your downloads to go faster. If I were only using traffic during the valleys of your transmissions, it would be like I was never using the connection from your perspective. So, me streaming music affects you less because we know that we can reschedule things within certain bounds.

There's a bit of a disconnect between pricing and usage. If you're using the network at 3am, your data usage probably isn't significant. Netflix refills its content caching boxes during times where network traffic is more idle because it isn't just about bytes transferred, but whether other people are trying to use the link's capacity at the same time you are. However, coming up with a pricing model that accurately models one's usage of a link's capacity as a function of contesting for that capacity from other users would be hard to come up with. Again, if I'm sharing a link with 100 other people and agree only to use the link when no one else wants to (ie, they aren't sending/receiving packets), then I'm never contesting anyone else for link capacity. By the way, I'm not saying that's a practical standpoint, just an illustrative thing.

If 1GB of streaming music is actually using up less of the network, why should it be charged the same? GBs of transfer is really just a proxy for what is actually cared about. In many cases, it's reasonable. We can't tell if you care whether that web page loads as fast as possible or whether that FTP transfer takes an additional minute or not. But we can say (with reasonably high confidence) that you don't care if the 30th second of a song arrives within 5 seconds of the transfer starting or 20 seconds of the transfer starting. As such, it's possible that we can reschedule streaming music in such a way that it's basically not using the network - at least not at times when other users care. Network capacity used when there's excess capacity other users don't want isn't really network capacity that's being used. It's simply filling what would be dead space.

If bandwidth caps/charges are supposed to make sure that high users pay for the capacity increases they necessitate or make sure that they don't crowd out smaller users, then shouldn't usage that might be high in GBs transferred, but is actually not requiring capacity increases or harming other users get a bit of an exemption?

Now, in practice, T-Mobile doesn't support all providers and that is concerning. It would be nice if they posted an explanation of their criteria rather than just saying "email us if you're on the inside". Likewise, it being free rather than a discounted rate based on how much it impacts can be concerning. Others can talk about the practice and the issues there because this comment is already too long.

tl;dr: GBs transferred is not exactly equal to network usage. Streaming music can actually use less of a network link's capacity than GBs transferred would make it seem because it can be rescheduled for times when the network is seeing less traffic and, therefore, not impacting users.

If AT&T were to, say, exempt all social networking sites or all encyclopedic wikis or something to that effect, then I wouldn't be nearly as opposed to it.

Granted, as a happy T-Mobile customer who has put the free music streaming to good use, I'm probably biased in favor of that variety of selective discounting. However, I'd be opposed to it if, say, only Pandora was allowed or only Amazon Prime Music was allowed or somesuch.

Private shared transportation does not have nearly the same incumbent advantage. Anyone can build or buy a bus, and move people around. There is not Facebook to pay lots of money to ensure that competitors are locked out of providing a similar service.

Moreover, users actually get meaningful choices when it comes to which car or bus to take. ISPs are more like roads, a utility where the options (in many places) are very limited.

Have you heard of the GM streetcar conspiracy?( http://en.wikipedia.org/wiki/General_Motors_streetcar_conspi... )

That doesn't make sense in this context though - the analogy breaks down.

The reason why regulation is useful is because unregulated companies collude, form monopolies, fix prices, and eventually kill innovation and prey on their customers. Regulation is a useful tool to provide an even playing field.

Sure, customers may be satisfied with a walled garden now, but how did facebook / twitter / netflix flourish? Using unbiased network traffic. We shouldn't shut the door on new startups.

(tl;dr: it pays to bus people if they're all going between the same points.)

In that sense, if some major sites can exploit the regularity of the traffic they get to the point that they produce less load on the network per bit transmitted, that it's (not un)reasonable that the user be billed less for that site, though "free" is still questionable.

We should be careful to distinguish "bribing ISP for preferential access" vs "accounting for the reality of the cheaper carriage of one site's data".

(tl;dr: cheaper data rates can reflect corruption or legitimately lower access cost, and our reaction should reflect that.)

Imagine if all the roads were toll roads. Regardless of whether you take a bus, car, taxi, bicycle, etc. the toll is waived if you're traveling to McDonald's whereas you have to pay the toll if you're traveling to Burger King. Shouldn't it be like electricity where you pay per kilowatt-hour regardless of the use? Or should powering, say, Sony devices cost you nothing but you get charged for powering other devices?

A better analogy is a situation where there are competing private bus companies, there's a road fee per user (paid by the user), and the city exempts users of its preferred bus company. In that situation, all other private bus companies are at a huge competitive disadvantage because their users are still required to pay the fee.

Any other encyclopedia and any wiki-formatted knowledge store could be considered close competition. Wikipedia's in the business of providing high-level (and often low) level information, and there are tons of players in that space - just perhaps not as generalized and overreaching.

Wikipedia is a non-profit. They don't really make more money by having more people use the site

Which doesn't mean that it can't compete with other entities, just that it does so under a special set of rules. It's still in the best interest of Wikipedia to keep up traffic.

but that's not the point, is it? what if I wanted to launch a competitor? the fact Wikipedia is non-profit shouldn't grant it some kind of super status above my business idea. non-profit doesn't automatically mean better or less evil for consumers.

I'm sure TVTropers resent that remark ;)

> Also, Wikipedia is a non-profit, and doesn't really make more money by having more people use the site.

Sure it does. You can't possibly tell me that you haven't noticed all the popups begging for money every year around the holidays. The more eyes on the site - and therefore the more eyes on those donation boxes - the more potential donations, and therefore the more money.

Being a non-profit doesn't mean there isn't competition involved.

EDIT: Yes, I still tether, I stated it for completeness. You can get around the tethering nag by using SSL or VPN when tethered.

I've just checked and the recurring charge I pay gets:

£12 goodybag: will include UK 3GB, 500 minutes, unlimited texts (was 250 minutes, unlimited data)

So thanks to your post I've just discovered I'm no longer getting the service I thought I was! It seems they sent a "changes to your service" email which I didn't read because I assumed it was ToS changes.

edited to add: This is 3G and not even 4G!

I’m talking about the issue of “zero rating”: the practice being followed by mobile carriers around the world to provide Web access “for free” to their users to certain chosen services.

But all other OECD countries have some flavor of zero rating in place.

I've never heard of a UK or European carrier implementing "zero rating" services, so I'm not sure how far around the world this occurs and the only concrete examples given are in the US.

I'm with a dinky little PAYG plan in Austria at the moment, and I just pay EUR3.95 for 1GB as I need it, which I never seem to use very fast because the majority of the time I'm connected via WiFi. Even when I was moving house in the UK and tethered my phone, I think I only used about 6GB in the course of a month. Of course I was slightly careful with video streaming and other data heavy activities, but I didn't really restrict my Internet use.

Anyway, my point is, "zero rating" even if it did occur would have very little relevance when data is so cheap anyway. It seems to me that the root of the problem is overpriced data, and not the "zero rating" of some services.

Edit: As for voice and text. I use Telegram for all my heavy "texting" and a SIP provider for all calls. I think my total monthly mobile telephony bill is only about EUR10 with the Austrian PAYG plan and another $10 with the SIP provider.

I used to have massive mobile phone bills, sometimes in excess of £100 per month (average around £70), when I lived in the UK and traveled around Europe a lot. This was all down to charges while abroad, and apart from not accept incoming calls, there wasn't a lot I could do about it if I wanted to continue operating my business.

I am clearly on a vastly inferior one with t-mobile and should switch.

If a company sponsored data on search so they could fill the results with ads for their products maybe?

Or if a streaming service sponsored data so they could get people to buy from their music store or something?

If the data is sponsored using funds from the profits of the sponsoring service, I can't imagine how that could be construed as anti-competitive. Presumably the competition could do the same thing unless there's some sort of exclusivity deal.

There is a competitive advantage to being a bigger company with more money to throw around, but does that make it anti-competitive?

On top of that, I would be surprised if some carriers are not just doing it as a marketing service. In Guatemala, I see huge billboards saying you don't need to pay anything to use Facebook, Whatsapp and some others. If you have an active line (meaning you've spent a dollar in a month or two or something low), you're set to use them.

Even promotion like that is somewhat anticompetitive if there's no way for other parties to let users know.

https://www.internet.org/press/introducing-the-internet-dot-...

I believe some of internet.org's strategies are good. I'd be a lot less skeptical if 'facebook' weren't on that list of 'basic apps'

The real problem re: network neutrality is a lack of competition and enforced monopolies. Open the last mile (and wireless) to more competition and you eliminate the worst network neutrality case scenarios.

Zero rating is anti-competitive. I don't think that can be argued.

What can be argued to to what degree it is harmful to the consumer.

Anti-competitive business models can be beneficial to end users in the short term (e.g. selling at a loss to drive out competition and build a monopoly) but are pretty much exclusively detrimental in the long term.

You don't need a slippery-slope argument, the immediate effects are anti-competitive. It adds a barrier to entry where in order to offer a service to a mobile user (with a data cap), you need to pay the carrier. It's like bribing a local official so that you can use the roads to make a delivery.

That's a bad analogy. A better analogy would be USPS[0] providing certain shippers with free shipping, and not others[1]. Imagine the disastrous effects this would have on small sellers, who would certainly not have the means to negotiate these rates with USPS, whereas a larger company would.

So it's not a slippery slope, because the anti-competitive impact is direct and immediate. USPS has to charge everyone the same price for the same service, and for good reason.

[0] Like broadband ISPs, USPS has an effective monopoly on shipping in parts of the country, as private carriers (UPS/FedEx) will simply "offload" certain deliveries to them, as USPS is required to ship to all locations.

[1] USPS does offer, for example, "Media mail" discounts, but this is available to all shippers, and represents a different service (slower delivery, no guaranteed dates - in the olden days, it represented surface shipping, though I'm not sure that is the case anymore).

The speculation that zero rating will lead to these problems is pretty much the exact OPPOSITE of an a priori fact... can you explain what you mean?

Also, the French consider free shipping anti-competitive: http://www.slate.com/blogs/moneybox/2014/07/11/france_banned...

I'm pretty sure you can't cache IMs, as that defeats the whole "instant" part.

Regulation doesn't just appear out of nowhere. It happens because bad things were happening before the regulations were put in place.

You are right, those two are not easily separable.