Not-so-unlimited MetroPCS

The Federal Communications Commission’s controversial new Net neutrality rules aim to stop broadband providers from discriminating against legal sites and services online, as well as to require more clarity about the providers’ terms and conditions. Now mobile phone carrier MetroPCS is presenting the first test: a $40 “unlimited” mobile broadband service that blocks video streams from all but one site, YouTube. The problem isn’t really what MetroPCS is offering, however. It’s what the company is telling consumers, and how the precedent it has set might redefine the meaning of Internet access.

MetroPCS’ $40 offering, announced last month, includes unlimited phone calls, text messages and Web access. What the company doesn’t make clear in its promotional materials is that customers can’t stream or download content from any site other than YouTube. Less limited services are available for $50 and $60 a month, although even those don’t include access to Skype and other Voice over Internet Protocol services.

Five advocacy groups complained to the FCC last month, arguing that MetroPCS was blocking legal Internet content in violation of the new rules. The $40 offering gives “a glimpse of the future of the mobile Internet, one in which carriers, not users, decide what content, applications and services are important and will be delivered,” the groups argued in their letter. In response, MetroPCS asked a federal appeals court to throw out the commission’s rules, claiming the FCC didn’t have the authority to adopt them.

MetroPCS’ decision to favor YouTube would be troubling if all mobile operators were doing the same. But the wireless market is highly competitive, and consumers who don’t like that limitation can sign up for a more expensive MetroPCS tier or switch to a truly unlimited offering from the likes of Sprint or Verizon Wireless. Such competition, along with the rapidly evolving nature of mobile data networks, is why the commission imposed fewer Net neutrality restrictions on wireless operators than on wired ones, whose customers often have few alternatives.

Nevertheless, the way MetroPCS is marketing the $40 service seems to run counter to the commission’s call for complete and accurate disclosures by all broadband providers. MetroPCS’ version of unlimited Web access is akin to a movie ticket that takes a consumer only as far as the concession stand. It should be much more forthcoming about the restrictions, rather than burying them in the fine print.