What the FCC's Ruling on Data Plans Could Mean for You and the Internet

February 7th 2017

Mike Rothschild

While President Donald Trump's cabinet picks continue to be put through contentious confirmation hearings, one new department head is already doing his job — and rolling back protections for a free and neutral internet.

Federal Communications Commission Chairman Ajit Pai was named to his post without a Senate vote. Within weeks, he has issued a number of directives, including one that indicates the agency will eliminate net neutrality, the rules designed to ensure equal access to high-speed internet for all users.

Because of net neutrality, internet service providers can't make certain content (like Netflix) load faster than other, competing content (like Hulu). This means independent content providers have a more even playing field on which to compete with more established brands.

But Pai is an ardent foe of net neutrality, at one point declaring that open internet, given its reliance on state regulation, would encourage censorship in North Korea.

On Feb. 3, Pai ended an FCC investigation into free data plans offered by AT&T, Verizon (for whom Pai was a lawyer), T-Mobile, and Comcast. The plans allow wireless carriers who own streaming services to make their own streaming content free, while forcing users who pay for rival wireless services to pay the usual data fees.

Technology news website ZDnet explained the process, called "zero-rating," like this:

AT&T recently entered the streaming TV market with DirecTV Now. If you watch DirecTV Now on AT&T Mobility, AT&T won't charge you for streaming. If you watch it on any other network you'll need to pay the usual charges.

This is called zero rating. AT&T isn't slowing down rivals Sling TV or PlayStation Vue. Nor is it speeding up DirecTV Now. Instead, it's making its own video service much more affordable than its competitors.

Under the Obama administration, zero-rating was seen as a net-neutrality violation with the potential to harm both consumers and small businesses, and diminish competition. But in a statement issued after the ruling, Pai declared that the FCC "will not focus on denying Americans free data,” and that these free plans are popular "particularly among low-income Americans."

Pai's ruling is likely to be the first in a series of decisions designed to cease regulating the internet like a public utility, which was a priority for the Obama FCC.

Trump himself has only commented on net neutrality once, conflating it with the now-repealed Fairness Doctrine, which mandated equal time on television and radio for both sides of a political issue.

But with Pai in control of the agency, the Trump administration is primed to roll back regulations aimed at protecting net neutrality, or eliminate them altogether. He said as much in a speech last December, expressing his desire to "take the weed whacker" to FCC regulations, and in particular, rules that govern internet providers.

"On the day that the [net neutrality] order was adopted, I said that 'I don’t know whether this plan will be vacated by a court, reversed by Congress, or overturned by a future Commission. But I do believe that its days are numbered,'" Pai told an audience at conservative think tank the Free State Foundation. "Today, I am more confident than ever that this prediction will come true."

Now leading the FCC, Pai has taken the first steps to fulfill his own prophecy.