Feds Suspect Cable Firms of Stifling Online Videos

DoJ conducting antitrust probe, sources say
By Rob Quinn,  Newser Staff
Posted Jun 13, 2012 4:17 AM CDT
Updated Jun 13, 2012 6:12 AM CDT
Feds Suspect Cable Firms of Stifling Online Videos
A menu is shown for Comcast's Xfinity video on demand.    (AP Photo/Comcast)

Federal authorities suspect cable companies worried about competition from online video have acted improperly to quash their emerging rivals, sources tell the Wall Street Journal. The Department of Justice has opened a wide-ranging investigation, and officials have spoken to online video providers and cable companies, including Time Warner and Comcast, the sources say. The investigation is focusing on data caps companies are using to deal with the rapid growth in video traffic.

The probe comes as viewers are shifting away from traditional cable bundles to video services like Netflix, leaving cable companies fretting about their customers "cutting the cord," CNET notes. Cable companies say the data caps are necessary to prevent heavy users from overwhelming networks, but video providers accuse the firms of using the caps to prevent users from switching to online video—and to give preferential treatment to their own online video offerings, like Comcast's data cap-exempt Xfinity. (Read more antitrust stories.)

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