FCC Plans To Fine AT&T For Misleading Customers About Slowed Mobile Data Plan Speeds

On Wednesday, the Federal Communications Commission (FCC) announced that it will fine telecommunications giant AT&T for misleading consumers about mobile data plans:

"The FCC’s investigation alleges that AT&T severely slowed down the data speeds for customers with unlimited data plans and that the company failed to adequately notify its customers that they could receive speeds slower than the normal network speeds AT&T advertised. AT&T began offering unlimited data plans in 2007..."

The FCC had charged AT&T with violating the 2010 Open Internet Transparency Rule by:

"... falsely labeling these plans as “unlimited” and by failing to sufficiently inform customers of the maximum speed they would receive under the Maximum Bit Rate policy."

AT&T began the Maximum Bit Rate plan in 2011 and:

"... capped the maximum data speeds for unlimited customers after they used a set amount of data within a billing cycle. The capped speeds were much slower than the normal network speeds AT&T advertised and significantly impaired the ability of AT&T customers to access the Internet or use data applications for the remainder of the billing cycle... The Enforcement Bureau’s investigation revealed that millions of AT&T customers were affected. The customers who were subject to speed reductions were slowed for an average of 12 days per billing cycle, significantly impeding their ability to use common data applications such as GPS mapping or streaming video..."

AT&T representatives disagree with the FCC's findings. The New York Times reported:

"... Michael Balmoris, a spokesman for AT&T, said the company planned to “vigorously dispute” the regulatory agency’s accusations. “The F.C.C. 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,” Mr. Balmoris wrote in an email. “We have been fully transparent with our customers, providing notice in multiple ways,” he wrote, pointing to a notice posted to the wireless carrier’s website."

Kudos to the FCC for protecting consumers' interests, and for performing the technical investigation most consumers lack the technical resources and expertise to determine if their Internet service provider (ISP) commits bandwidth throttling. Trust is critical. Consumers need to be able to trust that their ISP is providing the services they paid for.