ESPN May Subsidize Wireless Data Plans; Free Streaming for Subscribers

ESPN, an American sports global cable channel, is allegedly negotiating with AT&T and Verizon about possibly subsidizing the wireless data plan costs of subscribers using their bandwidth to watch ESPN. The report first appeared in Wall Street Journal.

The agreement doesn’t mean that ESPN will pay the entire plan but rather only those consumed by their channel. The discussion is still on its early stage and needs further planning to avoid some regulatory issues.

Last year, this concept was allegedly used by Comcast's Xfinity TV where customers are not being charged against their 250GB monthly cap. However, Netflix filed a complaint regarding fair use violation against Comcast. Comcast said that they neither manipulated anything nor partnered with any service provider to do it.

Unlimited data plans have been an ongoing issue between carriers and consumers as the carriers had enforced monthly caps on data use when smartphones were introduced in the market. The caps limit subscribers from downloading and streaming heavy video files. Those who have postpaid services are usually allowed to stream but are faced with large monthly charges when they receive the bill.

On an average weeknight, almost 35 percent of the internet traffic in North America goes to Netflix but ESPN is also popular for sports fans watching live games, replays, and follow their favorite players. Indeed, ESPN is still a popular choice despite the bandwidth disadvantages.

If ESPN will be able to arrange legality issues, it would increase its subscribers viewing up to the end of month. Users have maxed out their bandwidth before the month ends causing a significant drop on their online viewers.

However, ESPN and the mobile carriers denied this report as there was no meeting made about this matter in any point of time.

In the meantime, wireless carriers are willing to tie up with any channel provider who would like to pay for the data use of the subscribers seeing this concept a win-win situation for everyone. The subscriber enjoys unlimited streaming; the carrier earns more; while the channel gets more advertisement and views.