AND NOW END OF NET NEUTRALITY IS NEAR

January 20, 2014
Menno van Doorn

Something called “sponsored data” could change the rules of the internet game – and therefore the economy – dramatically. This new service was recently introduced during the world’s most famous gadget show, the CES in Las Vegas. It creates new ways to reach customers – with an offer that’s too good to be true. Using data will become part of a customer loyalty program; you’ll get it for free.more–>

MennoBig players are winners

The idea is simple: other companies pay for your data on the net. This sponsorship could make you decide to choose for let’s say YouTube instead of Vimeo in case YouTube decides to sponsor the data and Vimeo doesn’t. This example is used in a post by Nilay Patel (on theverge.com) to explain that the winners of this new AT&T offer will be the big companies. Companies with a lot of money, like Apple, Microsoft, Google. Smaller players won’t be able to pay the data-bill and if money is an issue – and for most consumers it is – it’s likely that the most powerful will gain more power. And a big part of that power goes directly to the internet service providers like AT&T, who now have a possibility to gain more control over the internet content.

ISP’s new USP

The net should be neutral to whatever provider you choose to deal with. But now the ISP’s have a new unique selling point (USP). Patel concludes in his verge blog posting that “If AT&T can levy taxes on access to a hundred million subscribers who are increasingly turning to mobile devices over traditional PCs, that turns the wireless behemoth into major economic gatekeeper on the internet — a situation that would flagrantly violate the net neutrality principles that govern landline internet but were waived for mobile.” So there is resistance to the idea that internet service providers gain more power over the use of internet.

In an open letter to the FCC, the organization public knowledge says:

“AT&T’s sponsored data scheme is just the most recent example of the troubling trend of ISPs using data caps to threaten an open internet.”

Athough Wheeler has said he would look at it, Forbes concludes a full investigation is unlikely.

“I am not advocating intervention unless there is an unmistakable warrant for it,” he told CES attendees.

Is the end near?

It might be too early to say whether or not data sponsorship will have a devastating effect on net neutrality as some are saying. For the moment it doesn’t look like FCC is on top of things, but AT&T has launched this new service with (only) three clients yet. But if sponsored data turns out to be popular amongst consumers, you could claim that the end of net neutrality is near. And in retrospect AT&T could say & sing “I did it my way”.

About the author

Director and Trend Analyst VINT | Netherlands
Menno is Director of the Sogeti Research Institute for the Analysis of New Technology (VINT). He mixes personal life experiences with the findings of the 19 years of research done at the VINT Research Institute. Menno has co-authored many books on the impact of new technology on business and society.

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