DoJ probes cable companies over 'anti-competitive' data caps

Posted by Emma Woollacott

The Department of Justice is launching an investigation into whether cable companies are deliberately manipulating their data caps to inhibit competition from online video.

According to the Wall Street Journal, the DoJ has already spoken to Netflix, Hulu, Comcast and Time Warner in what will be a wide-ranging investigation.

The investigation is believed to have been prompted by Comcast's merger with NBC Universal last year, which was approved on condition that Comcast refrained from 'unreasonably discriminating' against rival online video services through its broadband service or set-top boxes.

But, say critics, when Comcast decided to exempt its video-on-demand service on the Xbox 360 from the monthly data cap applied to its broadband service, it was doing just that.

Comcast defends its actions by pointing out that its Xfinity service uses the company's own private network, rather than the internet. It says this means it's not subject to the condition, and that it treats all internet video the same.

The DoJ is also believed to be investigating whether cable companies should be allowed to force viewers to have a cable subscription in order to access some online programming on non-TV devices; and the legitimacy of the 'most favord nation' clauses that force programmers to give the biggest cable companies their best price.

Lobbying group Public Knowledge says it's pleased with the DoJ's decision to look into the matter.

"The future of online competition for cable is being decided right now, and it is crucial that government agencies responsible for protecting the public interest do so," says legal director Harold Feld in a statement.

"Media and telecommunications giants, which can be one and the same, should not be able to take advantage of their size and reach to eliminate competition and to harm consumers through data caps which favor some content over other based on business relationships, through contract terms that could restrict where programming can be shown, or other means."