Trump's new FCC boss has already set the stage for a less-open internet

Getty/Chip Somodevilla

President Donald Trump's new Federal Communications Commission chairman, Ajit Pai, has wasted no time setting his agenda.

Last week, the FCC's Wireless Telecommunications Bureau closed multiple inquiries led by former Chairman Tom Wheeler into the data-cap exemption — colloquially known as "zero-rating" — policies of various internet service providers, including AT&T, Verizon, T-Mobile, and Comcast.

Previously, Wheeler, who stepped down once Trump took office, oversaw a monthslong back-and-forth between the FCC and those ISPs. That resulted in the commission casting doubt on the legality of the zero-rating policies of AT&T and, to a lesser extent, Verizon. The concern was that such programs could be anticompetitive and stand in contrast to the net-neutrality rules set by the 2015 Open Internet Order.

Those findings are now moot. Upon closing the inquiries, the WTB said in a notice the results of Wheeler's investigation would have "no legal or other effect or meaning going forward."

Pai reinforced that finality. "These free-data plans have proven to be popular among consumers, particularly low-income Americans, and have enhanced competition in the wireless marketplace," he said in a statement. "Going forward, the Federal Communications Commission will not focus on denying Americans free data."

This is noteworthy.

But first, some context.

Net neutrality is the idea that all lawful internet content should be treated the same. If every site and consumer has the same opportunity on a technical level, the argument goes, every online enterprise can compete on its own merits as much as possible.

Zero-rating, meanwhile, is when an ISP allows certain services to be streamed on its network with no effect on a user's data cap. T-Mobile popularized the trend with programs like Binge On, which zero-rated select video-streaming services so long as they streamed at a lower, non-HD resolution. T-Mobile has since rolled Binge On and its music-streaming counterpart, Music Freedom, into its default unlimited plan.

Since T-Mobile pioneered the trend, zero-rating has become increasingly popular among other carriers:

• Verizon's exclusive partnership with the NFL allows it to zero-rate game streams in the NFL Mobile app. It also zero-rates its fledgling Go90 video service, as well as content from its AOL affiliate.

• AT&T zero-rates the companion app of its DirecTV service, as well as its separate DirecTV Now live-TV-streaming app.

• Sprint has zero-rated select events, albeit on a smaller scale.

• Comcast exempts its Stream TV streaming service from its Xfinity data plans, too — though it justifies doing so by saying that's an "IP cable service" that isn't explicitly streamed over the internet, despite requiring an internet connection to work.

By itself, zero-rating does not necessarily stand opposed to net neutrality. Given how it makes data caps more manageable, even staunch net-neutrality advocates can see areas where zero-rating may be beneficial.

Here's Ernesto Falcon, legislative counsel at the Electronic Frontier Foundation, a consumer advocacy nonprofit that has lobbied against zero-rating as it is used today:

"A more logical usage [of zero-rating] would be if I was a cloud system backup program, if I back up your phone on the cloud, I don't need a fast internet connection to make that a feasible product. It'd just be a persistent connection to move your files to a cloud backup. I could then, as an edge provider, say, 'Go ahead and throttle my speed, go ahead and make me as slow as you need, to X percentage, in exchange for making me an off-the-data-cap service.'

"If that was the dynamic, we would be fine. Because it's the people who are being accessed on the internet, and the users, who are controlling that decision-making process."