Economy

Verizon Thumbs Its Nose At Net Neutrality, Gives Big Brands More Access

CREDIT: AP Photo/Amy Sancetta, file

Verizon announced its new data program FreeBee that allows consumers to get around their data cap when they view sponsored content from a select group of brands and publishers, including Hearst Magazines, AOL, and Gameday.

FreeBee works by transferring the costs of data incurred by wireless users to content providers, news organizations, or game companies. A brand can sponsor 30-second mobile video streaming, 30 minutes of audio, pay for the data needed to download their app, or comp mobile users for browsing its mobile website or using its app.

The program comes in two models that let content providers determine how much of their mobile content can be accessed for free. For example, instead of charging consumers for using more megabytes than allotted in their data plans, AOL could pay for the data used to read Huffington Post articles.

FreeBee also allows consumers to view free content by paying Verizon by clicks or gigabyte of data use. Free content will be denoted with a “bee” icon. The beta version of the program will be available January 25 for 1,000 subscribers to test the service.

“With 1 in 3 Americans now watching videos on their smartphone, and another 100 million on tablets, the business case for mobile is clear,” said Colson Hillier, Verizon’s vice president of consumer products, in a news release Tuesday.

Verizon’s FreeBee isn’t the first sponsored data plan of its kind. AT&T started a similar program called Data Perks in 2014 that didn’t draw much attention. T-Mobile revealed its Binge On unlimited streaming program in December, which allows some customers to stream video on their mobile devices without it counting against their data plans. Unlike Verizon, the company eats the data costs and doesn’t tap third parties such as Netflix or HBO Go to pay for consumers’ data usage.

Toll-free data programs were a primary concern in last year’s net neutrality debate, criticized for their potential to fracture internet access into fast lanes. Advocates worried that such agreements would amount to paid prioritization — a practice where content creators can pay broadband companies to ensure their content is delivered over competitors. As a result, established companies that could afford to pay would monopolize online traffic and revenue, leaving out startups looking to disrupt the market.

The FCC banned paid prioritization in its Open Internet rules, but hasn’t yet determined whether free data programs would restrict consumer access to the internet. But public protests against sponsored content have grown, especially as broadband providers and tech companies try to extend their reach in regions that aren’t connected to the internet.

Protests in India threatened Facebook’s Internet.org program last year, following criticism that the social network’s feel-good project to connect developing countries with internet access would create disparities by limiting new internet users to certain outlets. Facebook CEO Mark Zuckerberg rebutted, saying that free internet access itself was beneficial to consumers: “When you have a student who is getting free access to the internet to help do her homework, and she wouldn’t have had access otherwise, who’s getting hurt there?”