No, AT&T hasn't created internet fast lanes. But...

As net neutrality rules expire, changes may start to creep into how your internet works. Not everything you hear is quite true though.

Marguerite Reardon Former senior reporter
Marguerite Reardon started as a CNET News reporter in 2004, covering cellphone services, broadband, citywide Wi-Fi, the Net neutrality debate and the consolidation of the phone companies.
Marguerite Reardon
6 min read

AT&T has opposed the FCC's 2015 net neutrality rules. And as the rules are set to expire, some supporters of the regulation are nervous AT&T and other ISPs could abuse their power on the net. 

Kena Betancur / AFP/Getty Images

The Federal Communications Commission's 2015 net neutrality rules will officially be dead in a matter of weeks. So naturally, people are anxious about what that means for the internet as we know it today.

It's this anxiety and fear that's likely fueling recent blog posts stating that AT&T is rolling out so-called "internet fast lanes."

But is it true? Is AT&T carving out lanes on the internet and offering the speediest service to the highest bidder, while leaving all other internet traffic relegated to "slow lanes"?

Not exactly. AT&T hasn't introduced a new service that explicitly prioritizes one type of traffic over another.

"The author is getting the two distinctly different concepts mixed up," an AT&T spokesman said by email.

But that doesn't mean that it isn't offering other services that might run afoul of the strict net neutrality restrictions that are set to expire next month.

CNET has put together this FAQ that explains what's really going on and why consumers should still keep an eye on whether AT&T is playing nice with competitors on the internet.

What is net neutrality again?

Net neutrality is the idea that all traffic on the internet is treated equally. In 2015, the FCC under then-President Barack Obama adopted a set of rules that made sure broadband companies couldn't block or slow down access to websites. The rules also prevented internet service providers from creating fast lanes.

Watch this: Beer helps explain battle brewing over net neutrality

What exactly are internet fast lanes, anyway?

Internet fast lanes could be created if ISPs charge internet companies like Google or Netflix so that their services reach customers faster than other services on the net. That is, they'd be giving priority access to some services and not others.

Net neutrality supporters fear that anyone who can't or won't pay a fee will be relegated to congested "slow lanes." Think of it like priority boarding on an airplane. People who pay for first class get the best, roomiest seats and are guaranteed space for their luggage, while everyone else who could only afford coach is crammed in the back of the plane and can barely carry on a toothbrush, let alone a bag.

It's this idea of creating an internet of haves and have-nots that led the FCC in 2015 to ban these paid priority services as part of its net neutrality rules.

But is paid priority always bad?

Not necessarily. AT&T and others point out that some services are so time- and delay-sensitive, they just don't work if packets are held up by network congestion. Self-driving cars, remote surgery and virtual reality are all examples of real-time interactive technologies that would require guaranteed levels of service. AT&T's executive vice president of government affairs Bob Quinn argued in a blog post this week that the 2015 ban on these services meant companies couldn't experiment with services that require end-to-end network management, which he said is bad for innovation.

"I think we can all agree that the packets directing autonomous cars, robotic surgeries or public safety communications must not drop. Ever," he said. "So, let's address concerns around paid prioritization without impacting those innovations."

What about those reports suggesting AT&T is starting to offer paid priority services?

This is where things get confusing. AT&T doesn't currently and hasn't yet announced any service that offers priority over the internet. What AT&T announced last week -- and what some news outlets confused as paid priority-- was an expansion of a program it calls "sponsored content."

Under this business model, AT&T allows a company to pay it for data charges that a customer incurs while using that company's service. So instead of the customer paying for the data, the company pays for it.

"Sponsored content is delivered in the same manner as other third-party content," an AT&T spokesman explained.  "The only thing that changes under this model is that the sponsored content does not impact the user's data plan."

Here's how it works. Let's say you offer a streaming video service. Video eats up tons of data. Since mobile customers pay for the data they use, you as a video provider may want to pay for your customers to stream your service without having to worry about paying for the data charges, thus providing customers an incentive to use your service over someone else's that incurs data charges.

AT&T began offering this service for its postpaid customers (those who pay at the end of every month) in 2014 before the 2015 net neutrality rules were adopted. And it just expanded the program to its prepaid customers last week.

Do sponsored content services violate the 2015 net neutrality rules?

No. In fact, the FCC specifically said sponsored content, in a practice known as "zero rating," is not prohibited under the rules. It recognized that there could be benefits to consumers, such as lower cost of service. But the agency also realized that depending on how the plans were structured, it could also put competitors at a disadvantage.

This is especially concerning since broadband companies like Comcast and AT&T own a lot of content, which means they also compete with companies like Amazon or Netflix. So a broadband company, which also owns the network, could offer its services free of charge to customers, while competitors might not be able to afford to offer the same low price because they don't own the underlying infrastructure.

The FCC saw this potential conflict and included a broadly defined  "general conduct" rule, so it would have the authority to examine any practice that causes "unreasonable interference" or that "disadvantages" competitors.

Did the FCC ever think AT&T's service was problematic?

Yes. Within a year of the rules being adopted, the FCC, then controlled by Democrat Tom Wheeler, launched an investigation into programs offered by AT&T, T-Mobile and Comcast. It later added Verizon to the investigation. In January 2017, the agency issued a report stating AT&T and Verizon had violated the general conduct rule.

The biggest problem the FCC had with AT&T's sponsored data program was that it had priced its own DirecTV Now service so aggressively that it unfairly disadvantaged competitors. Since AT&T controlled the network, it didn't have to "charge" DirecTV, its own streaming service, the same rate it would charge a company like Netflix to deliver the same amount of data streams. And because Netflix would likely have to pay more to offer its video streams for free on AT&T's network, customers would end up paying more for Netflix than they would DirecTV.

"All indications are that AT&T's charges far exceed the costs AT&T incurs in providing the sponsored data service," the report stated.

AT&T argued it didn't violate the net neutrality rules and also said that the general conduct rule was way too broad.

Why is AT&T still offering this service if it violates the rules?  

The short answer is that the Democrats lost the White House. The FCC's report came out in January 2017, just days before Donald Trump was inaugurated as president and Republicans took over the agency. After Ajit Pai became chairman of the agency, one of the first things he did was close the investigation into AT&T and the other companies over zero rating. And the agency took no action.

"Going forward, the Federal Communications Commission will not focus on denying Americans free data," Pai said in a statement at the time. "Instead, we will concentrate on expanding broadband deployment and encouraging innovative service offerings."

And then late in 2017, the Republican-led FCC voted to overturn the earlier net neutrality rules.

Why should I care about this now?

As the 2015 net neutrality regulations are erased from the rule books, net neutrality proponents fear there will be no rules of the road to prevent AT&T and other large broadband companies from doing whatever they want online. This could mean offering paid priority services that might devolve into internet fast lanes. And the company could develop other business models, like sponsored content, that favor their own businesses over competitors' offerings.

AT&T and others argue they have no plans to discriminate against competitors or limit their customers' internet access. They argue that customers will benefit if the companies can experiment with different business models.

The question consumers must ask is whether we can take broadband companies at their word. Republicans on the FCC seem to believe we can. Democrats, net neutrality advocates, and a slew of online companies, from Google to Etsy, say no way.

One thing is clear: Everyone will be watching very closely what AT&T and others do next. 

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