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Telecom Regulator Weighs Consequences of Broadband Data Caps

Telecom Regulator Weighs Consequences of Broadband Data Caps

Fixed broadband services have blossomed in popularity in Brazil, meeting a demand spurred in part by plans that offer unlimited data. But the days of telecom providers offering these broadband services without data caps might be numbered. Telecommunications regulators in Brazil have said that they will not use their legal authority to interfere with the plans of telecom operators to impose limits on data.

In the past, telecom companies have offered unlimited data as an incentive to new customers. Yet now, these same companies contend that offering unlimited broadband indefinitely is not economically sustainable.

According to Folha de S. Paulo, Anatel – Brazil’s telecom regulator – has defended the broadband providers. Anatel says that it is unreasonable to expect companies to continue offering unlimited data in light of the rapid growth of video streaming and online gaming. Yet at the same time, Anatel also faults the telecom companies for making users think that unlimited broadband plans would be available indefinitely.

Supporters of unlimited broadband plans say that more is at stake than economics. André Figueiredo, Brazil’s minister of communications, implored Anatel to ensure that companies honor their contracts with consumers, reported Folha de S. Paulo. Meanwhile, the consumer group Proteste has tried to make the case that imposing data caps violates the Marco Civil, Brazil’s broad-reaching law governing Internet services.

In searching for a middle ground, Anatel tried to ensure that consumers would have some measure of protection as telecom providers change their plans. The regulator said that service providers could offer new plans with data caps only if they give consumers tools to track and monitor data consumption.

But shortly thereafter, Anatel abruptly delayed the decision to end unlimited broadband. The regulator faced protests from consumers across the country, and its website was compromised by activist hacker collective Anonymous. After the backlash, Anatel said that its decision to let service providers cap data usage is on hold until it reviews the new plans offered by the companies.

A regulator’s role includes taking steps to ensure a competitive market that is fair to all participants. Anatel’s prior statements suggest that the agency is inclined to let market forces work. The next steps could reveal possible changes in the agency’s thinking and offer insight into the possible framework for future telecom decisions.