Comcast exempts its new streaming video service from bandwidth caps

U.S. cable network operator Comcast said this week that its new Xfinity online streaming video service would be exempt from the bandwidth caps it imposes on its own Internet subscribers, raising alarms that it could be committing a serious violation of Internet neutrality principles.

The company launched their Xfinity streaming video service Wednesday on Xbox Live, marking the start of a new partnership for Internet video delivery that binds gaming and cable television service together for the first time.

But it's not all roses: first, Comcast Internet subscribers must also subscribe to Xbox Live and the new Xfinity service, and have another cable box in the house tied into Xfinity as well. Once those requirements are met, Comcast's full library of new streaming videos are available at the push of a button, delivered over the Internet to the users' gaming console.

The only potential roadblock, Comcast's 250 gigabyte bandwidth cap, is also not a concern, the company said this week. Xfinity subscribers on Xbox will be exempt from the cap when using the service, but other competing Internet video applications will not enjoy that luxury.

More than 50 percent of Americans' Internet connections have become bandwidth-limited in recent years.

Microsoft is quite pleased about the partnership: the company has been emphasizing the integration of video applications on Xbox Live for years now, and just this week they announced that more than 50 percent of their traffic is going to "entertainment" services, instead of just online game playing.

Xfinity and its chief rival, popular online video sharing service Netflix, are a big part of that, along with Hulu Plus, ESPN and Microsoft's own video rental service Zune Marketplace. But Comcast's move gives them a clear leg-up on the competition, especially for users who frequently watch bandwidth-heavy media like high definition movies and television shows.

By exempting its own service from the company's bandwidth caps, Comcast places its content rivals at a disadvantage that, on its face, appears to violate the principle of Internet neutrality, which the Federal Communications Commission mandated for the public Internet in rules issued two years ago. Internet neutrality stipulates that all web traffic must be treated equally, which would seemingly prevent big corporations from prioritizing their traffic over small businesses, activist groups and others.

Comcast is getting around those rules by delivering Xfinity over a "private IP network," it explained in a customer FAQ published this week. By drawing a distinction between "the public Internet" and its own high bandwidth "private" network, Comcast has proved its critics were right to suggest that weakened neutrality rules would lead to the creation of "super tiers," where more bandwidth would be available to the owners, operators and, potentially, anyone who can pay enough.

Comcast and Netflix did not respond to requests for comment on this story.

Internet freedom activists have long warned that the "cableization" of the Internet was coming, and if Comcast were to open up its own "private IP network" to other major content providers -- for a fee, of course -- it would represent the creation of a super-tiered Internet of sorts, where moneyed players essentially run the show, forsaking the public Internet for the private Internet and hauling millions of users along with them into a new environment with entirely different rules.

It's also not the first time Comcast has used its bandwidth resources to hurt a competitor and enrich itself: in 2010, Netflix partner Level 3 was forced into paying a reoccurring fee to "transmit Internet online movies and other content to Comcast's customers who request such content." They agreed under protest, saying their highest priority was averting service interruptions, which Comcast threatened if Level 3 did not pay up.

Critics compared the move to extortion and blackmail, but it was perfectly legal because no regulations at the time had addressed network operators charging tolls or blocking content. Now that those rules are solidified and "public Internet" traffic must be treated equally, network owners have been eyeing ways to further monetize their bandwidth resources.

Xfinity, it would seem, is just the beginning.

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