Justice Department Investigating Cable Companies' Fear of Streaming Video
The Wall Street Journal reports the Justice Department is investigating whether cable companies have been unfairly working to regulate Internet consumption to prevent people switching from cable to online video. The investigation apparently centers around, "issues such as setting data caps, limits to the amount of data a subscriber can download each month," according to the Journal.
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The Justice Department is taking "a particularly close look" at the data caps some companies that provide Internet and cable set on customers who use too much bandwidth. In a move to promote their own streaming service, Comcast announced in March that any videos streamed with their Xfinity app on an Xbox 360 wouldn't count towards a customers data limits. But that move may have backfired for them, because now the Justice Department is looking at whether the Xbox deal violates commitments Comcast made to not "unreasonably discriminate" the competition in their takeover of NBCUniversal. Comcast says the Xfinity/Xbox loophole doesn't violate the terms of the takeover because Xfinity transmits its data on Comcast's private network, instead of over the "public Internet" like Netflix or Hulu.
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This is good news for people who like to watch their television on Netflix or Hulu. If the Justice Department rules that data caps, or even if just charging more for high traffic customers, is illegal it will free up any concerns some customers might have about dropping their cable service. If you can handle always being a day late on your shows, streaming will be a lot more enticing if the penalties for heavy use are gone. Additionally, the Justice Department is looking into whether companies are allowed to force users to have a cable subscription to access their content online. The example the Journal provides is how ESPN makes users enter their cable subscription details in order to access streaming content on their iPad app instead of charging a flat fee for access.
