The Wall Street Journal reports the Justice Department is conducting a wide-ranging antitrust investigation into whether cable companies are acting improperly to quash nascent competition from online video.
With broadband Internet, consumers can watch individual programs or channels through online video services like Netflix, Hulu or Amazon, bypassing the cable company’s traditional bundles of channels.
Having invested billions of dollars building their networks, some pay-TV and entertainment companies have an interest in preserving their current model of television viewing.
In its cable TV probe, Justice Department investigators are looking at the data caps that Comcast and AT&T have used to deal with surging video traffic on the Internet. Comcast recently raised its data caps from 250GB to 300GB, but has met controversy because its own on-demand video service for the Xbox 360 does not count against data caps.
Already the Justice Department’s Antitrust Division brought a lawsuit alleging that publishers and Apple colluded to fix prices. In April, several publishers settled the charges while Apple and other publishers continue to fight the suit.