Wednesday, June 17, 2015

FCC to Fine AT&T $100M for Throttling Unlimited Data Subscribers

It seems as long as cellular providers offer unlimited data service, there’s always going to be a question of whether your service is going to be throttled at some point. In today’s news, the spotlight has turned on AT&T. Just earlier, the FCC announced that it will be fining AT&T $100 million for throttling data speeds for customers with unlimited data plans. In its formal announcement, the FCC said AT&T “deprived consumers of sufficient information to make informed choices about their broadband service” which hurt competition. This also outlines unlimited data plans offered by AT&T in June 2007 that ended up being discontinued in 2010.

In short, the FCC is claiming that AT&T misled their customers into paying for unlimited data, but failed to properly disclose their policies on speed throttling, which violates the Open Internet Transparency Rule. The complaint, which is “based on the seriousness of AT&T’s apparent violations,” is requiring the carrier to adjust their practices to meet the Open Internet Transparency Rule.

AT&T had implemented a Maximum Bit Rate Policy to subscribers after offering them the ability to renew unlimited data plans WITHOUT properly disclosing the restriction. They continued to advertise “grandfathered” unlimited data plans to customers, but would significantly lower their data speeds once the customer reached a certain amount of data usage for the month.

AT&T is of course convinced they’ve met the FCC’s requirements, releasing this statement: “We will vigorously dispute the FCC’s assertions. The FCC has specifically identified this practice as a legitimate and reasonable way to manage network resources for the benefit of all customers, and has known for years that all of the major carriers use it. We have been fully transparent with our customers, providing notice in multiple ways and going well beyond the FCC’s disclosure requirements.” The carrier also directed attention to a detailed filing with the FCC from earlier this year, which discloses its Maximum Bit Rate Program’s rollout and implementation.