U.S. cable companies have become the subject of a wide-ranging antitrust probe launched in secret by the Department of Justice, The Wall Street Journal reported Wednesday.
Pay TV companies like Comcast, Time Warner Cable and AT&T have been questioned by investigators who are looking into whether they’ve conspired or colluded to artificially limit options for online video distribution. The report noted that officials have also spoken to Netflix and Hulu, two of the leading distributors of online video.
Cable companies have, in recent years, focused on bundling their television and Internet services for a lump sum, but an even more recent development has seen those same companies limiting the amount of data customers can access via the Internet each month, and charging “overage” fees if a customer downloads too much.
While that is not anti-competitive in an of itself, some worry that cable TV operators who also provide Internet services are favoring their television platforms more and using their control over the networks to restrain competition from the Internet, in spite of federal “Net neutrality” regulations that require them to treat all traffic equally on the public Internet.
That’s why Netflix CEO Reed Hastings nearly blew a gasket earlier this year, when Comcast said it would deliver streaming video via its Xfinity service over a “private IP network” that does not count against customers’ bandwidth caps.
In a post to Facebook, Hastings explained that he sat down in front of his television to watch an episode of Saturday Night Live on a Xbox gaming console running a Hulu application, then watched the same episode through Comcast’s Xfinity service running on the same console, only to be charged against his bandwidth limit for using Hulu, but not Xfinity. “The same device, the same IP address, the same wifi, the same internet connection, but totally different cap treatment,” he wrote. “In what way is this neutral?”
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