FTC sues AT&T for limiting “unlimited data”
“Unlimited data” sounds great, right? Browse the Internet, stream videos, use GPS, even make video calls – all to your heart’s content. But what if you bought an unlimited data plan and then weren’t able to do all those things? That’s what happened to some AT&T customers.
From 2007 until 2010, AT&T offered unlimited data plans for smartphones. Even after it stopped offering unlimited data, AT&T allowed customers who already had unlimited plans to renew them.
But here’s the catch: AT&T then began slowing the data speed for “unlimited” customers who used large amounts of data. As a result, those customers with “unlimited” plans no longer had the bandwidth to do everything they wanted to do on their phones. That’s called data throttling.
Data throttling isn’t always illegal, but when it’s done in a way that’s deceptive or unfair, it most certainly is.
Today, the Federal Trade Commission (FTC) sued AT&T Mobility LLC for deceptive and unfair data throttling. The FTC’s complaint says that AT&T’s data throttling is deceptive because the company promised unlimited data, and then reduced the data speed without telling consumers. The FTC also says that AT&T’s data throttling is unfair because it kept people from using data they paid for, and then made them pay early termination fees if they tried to leave AT&T.
The FTC’s case, filed in the U.S District Court for the Northern District of California, seeks to stop AT&T from using data throttling on customers who have been promised unlimited data plans. It also asks for refunds for people who paid early termination fees when they cancelled their unlimited data plans after their data was throttled.
The lesson to mobile companies: if you promise unlimited data, you’re on the hook to deliver.