German telco Deutsche Telekom is no longer allowed to continue operating its controversial zero-rating tariff option StreamOn in its current form.
The Higher Administrative Court for the federal state of North Rhine-Westphalia decided this in an urgent procedure, thus confirming the first-instance decision of the Administrative Court of Cologne.
Despite the court ruling, Telekom intends to continue offering StreamOn – with adjustments, a Telekom spokesman told Broadband TV News, stressing that there would also be no additional charge for StreamOn in future.
“We will now examine how we deal with the ruling,” said the spokesman. “We expect that the Federal Network Agency will allow the necessary adjustments to be made within a reasonable implementation period. We remain convinced of the legality of StreamOn and will continue to make full use of all legal possibilities in the future.”
StreamOn is a free additional offer for Telekom’s mobile services customers. When booking, the data traffic for audio and video streaming from Telekom’s content partners is not offset against the data allowance contractually agreed in the mobile tariff.
For certain mobile rates, however, the customer agrees to a general bandwidth limit for video streaming of a maximum of 1.7 Mbit/s, which is no longer sufficient for resolution in HD quality. Moreover, StreamOn is only intended to be used within Germany. Data traffic for audio and video streaming abroad is always deducted from the data allowance.
The Federal Network Agency concluded that StreamOn violates the principle of net neutrality anchored in European law as well as European roaming regulations through these restrictions and prohibited the zero-rating service’s continuation in the current form.
The Administrative Court in Cologne rejected an appeal by Telekom against the regulator’s decision. In its ruling of July 12, 2019, the Higher Administrative Court now also dismissed Telekom’s complaint against the lower-instance court decision.
The judges explained that the principle of net neutrality obliges internet service providers to treat all data traffic equally. This is violated if the video streaming speed is deliberately throttled compared to other services or applications. Since the principle of neutrality protects a fundamental functional principle of the internet for the benefit of all users, it is also irrelevant whether the customer has agreed to the throttling by signing up for StreamOn.
Furthermore, under European roaming rules, it is prohibited to charge an additional fee for roaming services in other European countries compared to the domestic retail price. Telekom violated this prohibition as it deducts the data traffic for audio and video streaming for use in other European countries from the data allowance, in contrast to use in Germany. This would result in a less favourable pricing structure for customers using the service in other European countries.
Since the decision of the Federal Network Agency was likely to be lawful for these reasons, it could also be implemented ahead of a final decision in the main case, according to the court ruling. The decision is final.