AT&T responded to US regulator Federal Communications Commission’s (FCC) concern that its DirecTV mobile video services, which do not carry data access charges, are discriminatory.
The FCC said earlier this month said the operator’s video services may harm competition because it could be too expensive for rivals not affiliated with the operator to sponsor the data cost needed to compete.
Robert Quinn, the operator’s policy chief, argued a rival content provider could pay AT&T through its sponsored data programe to offer their own video services with free mobile streaming.
Quinn said AT&T started zero rating its DirecTV video app in September. Nearly three million consumers used the app in the first four weeks after its launch, according to the Wall Street Journal.
The operator plans to use the same approach for its streaming DirecTV Now, due to launch on 28 November.
AT&T spends again
The response comes amidst yet another investment by the operator in its media strategy. This time it is jointly acquiring Invidi Technologies with US satellite broadcaster Dish Network and advertising firm WPP.
Invidi’s technology better enables advertisers to reach their target markets with video advertising. The firm will continue to operate independently under the three companies’ collective ownership. AT&T will hold a controlling interest in the venture.
Separately, AT&T signed a deal with Fox Networks to continue showing its contents across its platforms including DirectTV Now. CBS Corp is now the last major holdout whose content is not yet available on DirectTV Now, ahead of its launch next week.
Hence, the importance for AT&T of heading off any regulatory intervention from the FCC. In addition, the arrival of a new regime at the US regulator following the election of President Trump raises the possibility of a new direction on net neutrality questions.
In the meantime, Quinn said FCC’s argument that AT&T does not incur costs in using its network to offer free data for video is “flatly incorrect”, said Reuters.
Sponsored data services cause a jump in video traffic on its mobile network, he said, leading to “capital-intensive investments, which will add to the billions already spent to keep up with skyrocketing mobile video usage.”