AT&T's Latest Move Should Have Net Neutrality Advocates Freaking Out The telecom giant has signed on the first significant customer to its sponsored controversial data program.

By Steve Kovach

This story originally appeared on Business Insider

Syntonic Wireless, a Seattle-based mobile services company, is the first significant player to take advantage of AT&T's sponsored data program, which should have net neutrality advocates freaking out.

AT&T announced its sponsored data program in January. It lets companies pay AT&T so data usage from their apps and services won't count against a customer's data plan. For example, a company like Netflix or YouTube could pay AT&T to let customers stream all the video they want without having to worry about using up their monthly data allotment.

But the announcement caused a lot of advocates of net neutrality to blast AT&T for the move. In effect, sponsored data gives an advantage to rich companies that can afford to pay AT&T for such a plan and reduces the chances of smaller competitors creating innovative new services. It may be good for the consumer in the short term, but it could be a major hurtle to competition down the road, especially as the majority of computing shifts to mobile devices.

Since AT&T is essentially letting companies pay for access, the fear is that it could eventually let the big guys get bigger, which will result in higher prices and fewer choices for consumers.

Syntonic Wireless will offer its mobile content store to select AT&T customers. The company promises "free or premium mobile content" that won't affect AT&T customers' data plans.

And even though Syntonic Wireless is hardly a major mobile content provider, its move signals the beginning of a slippery slope for AT&T and the wireless industry at large.

AT&T isn't the only carrier making anti-net neutrality moves. T-Mobile recently announced that it'll let customers stream music from some select services like Spotify over its network without it counting against data plans. The music services aren't paying T-Mobile for this, a company spokesperson confirmed to Business Insider in June.

But even though T-Mobile isn't accepting payment, it's still giving preferential treatment to some services over others, which is bad for competition.

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