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AT&T Is Not Happy About California's Net Neutrality Law

Illustration for article titled AT&T Is Not Happy About California's Net Neutrality Law

Photo: Mark Lennihan (AP)

AT&T just lambasted California’s recently enacted net neutrality laws, blaming the state as the reason why it can no longer offer certain data features to consumers free of charge.

“We regret the inconvenience to customers caused by California’s new ‘net neutrality’ law,” AT&T said in a Wednesday blog post.

Last month, U.S. District Court Judge John Mendez ruled that the state’s net neutrality laws could officially be enforced, which means wireless carriers like AT&T have to treat all internet traffic the same. California’s law had been in limbo since 2018, because the Trump-era DOJ filed a lawsuit against the state claiming it had no authority to enact its own net neutrality laws. California held off on enforcing the law, and the lawsuit never went anywhere. The DOJ officially dropped its lawsuit against California when the Biden administration took over.

Under the new law, ISPs and wireless carriers cannot intentionally block websites, throttle bandwidth, or charge money for specific online content. ISPs are no longer able to dictate what sites, content, or applications get preferential treatment.

This means that AT&T no longer has the ability to offer so-called zero-rating schemes, or data cap exemptions to its subscribers. The carrier had done just that by giving its in-house streaming service, HBO Max, an exemption so that customers who streamed from the service wouldn’t see that data usage counted toward their monthly limit. That’s about to change.

After AT&T acquired WarnerMedia in 2018, which owns HBO, the company launched its HBO Max streaming service in May 2020. Because AT&T owned the streaming service, it decided it would not count that data usage toward its customers’ monthly data caps. AT&T said its “sponsored data” system actually let any company pay the the carrier to exempt it from data caps.

“AT&T Mobility has for years openly invited any entity to become a wireless data sponsor on the same terms and conditions,” said the company in its statement.

It’s easy to say that when you own the streaming service you’re not counting toward your customers’ data caps. But AT&T did not disclose what (or if) any other streaming services are currently taking them up on that offer. It’s been reported in the past that large streaming companies like Netflix have paid AT&T to reduce buffering times, but currently streaming Netflix counts toward your data cap.

Ultimately, Judge Mendez denied AT&T and other ISP lobby groups present an injunction, and now the lobby groups are appealing that decision in the U.S. Court of Appeals for the Ninth Circuit. It would appear internet service providers aren’t done fighting net neutrality just yet.

The bad news is that if you’re an AT&T subscriber who’s been binging HBO Max—which, uh, sure—well now all that streaming is gonna eat up your monthly data allowance. But for the good of the internet, it’s a perk that had to go.

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