U.S. FTC suing AT&T over promises of unlimited data

“The Federal Trade Commission is suing AT&T Wireless [sic] [recte AT&T Mobility], saying it is seeking millions of dollars in restitution for customers who were promised unlimited data plans by the wireless carrier, only to have their mobile network speeds slowed in a practice known as data throttling,” Christine Mai-Duc and Julie Westfall report for The Los Angeles Times.

“According to a federal complaint filed in San Francisco, in October 2011, AT&T began reducing speeds for customers who surpassed a threshold of monthly data usage, determined by AT&T,” Mai-Duc and Westfall report. “Those customers would see their network speeds diminished for the rest of the billing cycle, regardless of whether there was actually any congestion on the network at the time, the FTC alleges.”

“‘The company has misled millions of its mobile customers … with so-called unlimited data plans that were in reality not unlimited at all,’ FTC Chairwoman Edith Ramirez told reporters. Ramirez said the practice of data throttling cut speeds for some unlimited data customers by 90% or more, often making Web browsing or GPS navigation ‘significantly slower or practically inoperable,’ Mai-Duc and Westfall report. “According to Evan Rose, a lead FTC attorney on the case, AT&T had approximately 14 million unlimited data customers when it began the practice in 2011. Since then, Rose said, about 3.5 million users, or roughly a quarter, have had their data connections throttled by AT&T at some point, which has used the practice at least 25 million times, according to the FTC. AT&T is still using the practice today.”

Read more in the full article here.

[Thanks to MacDailyNews Readers “David G.” and “Arline M.” for the heads up.]

28 Comments

  1. As sad and unfortunate as it is, I’m not sure they have a legitimate case here. AT&T promised unlimited data- not an unlimited data rate. Just because the rate is throttled back by 90%, it doesn’t mean that your total amount of data is limited (that is, your data is still free whether you use 3GB or 20 GB- it’s just slower once you pass a threshold). Unless AT&T promised the same connection speed, I don’t see that there’s a case here…

    1. “Unlimited data rate?” Maybe you mean “a consistent data rate..?”
      i.e. The fastest available in your location. I remember my original unlimited plan going up $10 a month because I was was going from 2G to 3G with the iPhone 3G. So I was paying more for a faster connection and that’s what you should get. If your speed is being throttled then your data is being limited. Right. If 45mbs is available but holding you back to 3mbs then you’re data us being held back or in other words “Limited.”
      That’s my take. If I’m paying for LTE 4G or whatever, then that’s what I should get.

    2. When the fist phones were sold with unlimited data, the phones were EDGE (2G), I believe. SO those on grandfathered plans should be happy to get LTE and 3G unlimited. On the other hand, T-Mo gives you unlimited to the elvel you pay for and is unlimited after that though the excess is throttled. I get 5GB LTE for $15 at TMO.

    3. So by your logic, if I rent a car with “unlimited miles” but after I drive 5 miles, the car is limited to driving 5 mph, that’s still “unlimited miles”. Never mind I could get out of the car and move faster at a brisk walk.

      I think you have a very poor argument. You might work for the government.

      1. You may think it’s a “poor argument” but in the eyes of the law, he may have a point.
        Don’t dismiss the ability of a lawyer (or team of them) to figure out a way to legally screw customers..

        There may be no legal issue to throttling..
        And just in case you didn’t know, most rental cars have GPS built in.. just because you didn’t get a speeding ticket from any Police, doesn’t mean the rental company doesn’t know you were speeding. (and charge you)

        However the case goes will be huge.

        They find AT&T wrong, great.
        They find AT&T clear of any wrongdoing…

  2. I still have a text message alert from AT&T as evidence that I was affected by this. For compensation I’ll take an unlimited hotspot plan for my iPhone, thank you very much.

  3. I was in an AT&T store last week where the salesgirl look me in the eye and said you know if you stay with the unlimited data plan we’re going to throttle you whenever you use 5gb of data – she said that to try to force me or push me over to a shared data plan – I was shocked that she would have the guts to say that out loud to a long term AT&T customer – thanks Att for valuing us so little

    1. I have never been happier than since I left AT&T and my unlimited data plan. Verizon takes much better care of me, not to mention that I get tons more data off their much more reliable network anyway. AT&T stinks in my neck of the woods.

      1. Always had issues with Verizon, thats why I left.
        My nieces both got screwed out of their grandfathered unlimited iPhone plan…. when they bought a new iPhone.

        I’m the opposite from you, Verizon has the 2nd worst network around here. Sprint being first. (they use some of Verizons towers)
        AT&T’s LTE is almost twice the speed of Verizons LTE here.

    2. Yea, I was talked out of my grandfathered AT&T unlimited plan. They refused to add my daughter to our family plan if I didn’t. I was going to move over to T-Moble’s unlimited plan but they are playing the same games with their so-called unlimited plan.

  4. I can’t the problem with “Unlimited Data*”
    *speed may be throttled
    In Australia with our monthly limits eg a generous 3GB the telcos used to change up to 20c per MB for excess usage. Now they throttle to dial-up data rates.

  5. All the “lawyering” on this point is silly and I applaud the FCC for intervening. The use of the word “Unlimited” in ATTs advertising is MISLEADING unless they allow you to use data at the same rate in the same way for the 1st meg as the 1000000st meg. We all know why they said it. They should have used another word such as 10 Meg or “Limited”. They tried to use “small print” and tricks to not have to provide what they said they were going to provide. Lets not mince words they were being purposefully deceptive.

    1. I think you’ve touched on the key point in this matter – did AT&T mislead their customers? Was there a reasonable expectation by customers who bought these plans that they would remain unlimited? It’s more a question about deceitful practice than unwelcome throttling.

      1. yep.
        I didn’t read the contract.. I just went with unlimited data.
        For all I know, the fine print could say that “unlimited” means unlimited data… and throttling could have been mentioned at a certain point in the data used.

        What if AT&T’s unlimited no restrictions data… was for 3G.
        When they switched to “4G” and then LTE… maybe AT&T agreed to keep the unlimited data… but inserted the throttling portion.
        When you traded up to a new iPhone, that were new to 4G or LTE.. And kept your unlimited data, In the excitement of getting that new shiny iPhone, did you read the new contract? If AT&T changed the terms then, right or wrong, If you signed the contract.. it won’t matter.
        Maybe those that still have iPhones 4S and below with unlimited data could have a case against AT&T.

        Not defending AT&T here, just saying there are lawyers that can find ways to switch the deal. Legally.

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