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AT&T (NYSE:T) Discontinues “Sponsored Data” For AT&T TV And DirecTV Following California’s Net Neutrality Law

AT&T (NYSE:T) has announced that it will not exempt HBO Max stream services viewership from data caps because of California’s net neutrality law. A federal judge upheld the net neutrality law; as a result, the carrier has indicated that its AT&T and DirecTV streaming services will no longer be exempt from its tiered data plans.

AT&T TV and DirecTV will not be exempt from data caps

The law prohibits operators from preferring their content and services over rivals’ offerings. According to the company, the neutrality law doesn’t allow “sponsored data” services, often called “zero-rated” plans. The plans allow customers on AT&T’s tiered plans to use its services such as AT&T TV and DirecTv without consuming their monthly data allotment. On the other hand, other streaming services such as Amazon Streaming and Amazon will count to the monthly data allotment.

The carrier informed its customers that it is ending “Dar Free TV” on its video app from March 25. This implies that customers must have a Wi-Fi connection to avid streaming counting towards the monthly data allotment. Interestingly, this change will go beyond California since, the company indicated, “the Internet does not recognize state borders.”

AT&T’s announcement highlights the concerns the industry has had with state actions affecting the internet sector. Like most digital privacy laws currently existing in some states, the tech sector fears state laws patchwork, making it challenging to operate, especially for small players.

California created the strictest neutrality law

The carrier confirmed that a state-by-state approach to the neutrality law is unworkable. AT&T added that most of the state laws patchwork is excessively restrictive, creating roadblocks to creative pro-consumer solutions. The California neutrality law is one of the strictest protection laws to date, surpassing Obama administration protections. The state passed the law in 2018 baring internet service providers from slowing or blocking internet access when monthly limits are reached. Equally, the regulation outlaws a “sponsored data” offer that allows carriers such as AT&T to exempt their services from counting against the data limits.

Published by Alan Masterson

Alan has over 25 years of trading experience in the U.S. equity markets. He began his career in finance working on a program trading desk specializing in over-the-counter stocks. His career progressed from that point to his current position as senior trader on an institutional trading desk. In the evenings, Alan teaches economics at a local community college. He has contributed articles to various publications over the last six years, including feature articles for an economics magazine and various financial blogs. You may contact Alan via his email (alanmasterson@wallstreetpr.com) or his Google+ page (https://plus.google.com/103338576216002376250).

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