FTC Complaint Against AT&T May Put an End to Throttling Unlimited-Data Customers

FTC Complaint Against AT&T May Put an End to Throttling Unlimited-Data Customers
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October 28, 2014

AT&T's throttling practice may finally be coming to an end.

The Federal Trade Commission (FTC) filed a complaint in federal court against the mobile carrier for reducing the data speeds for millions of its unlimited customers.

According to the complaint, AT&T failed to tell customers with unlimited data plans that if they reach a certain amount of data usage in a given billing cycle, the company reduces, or throttles, their data speeds to the point where many mobile phone applications become difficult or nearly impossible to use.

AT&T's marketing materials emphasized the unlimited amount of data that would be available to consumers who signed up for its unlimited plans. The complaint alleges that, even as unlimited plan consumers renewed their contracts, the company still failed to inform them of the throttling program. When customers canceled their contracts after being throttled, AT&T charged those customers early termination fees, which typically amount to hundreds of dollars.

Despite its unequivocal promises of unlimited data, AT&T began throttling data speeds in 2011 after customers used as little as 2 gigabytes of data in a billing period. The complaint says the throttling program has been severe, often resulting in speed reductions of 80 to 90 percent for affected users. The FTC believes that AT&T has throttled at least 3.5 million unique customers a total of more than 25 million times.

AT&T documents showed that the company received thousands of complaints about the slow speeds under the throttling program, some calling it a bait and switch. Many consumers also complained about the effect the throttling program had on their ability to use GPS navigation, watch streaming videos, listen to streaming music and browse the web. In its own focus groups, participants strongly objected to the idea of the program.

The complaint charges that AT&T violated the FTC Act by changing the terms of customers' unlimited data plans while those customers were still under contract, and by failing to adequately disclose the nature of the throttling program to consumers who renewed their unlimited data plans.