FTC suing AT&T over "deceptive" throttling of unlimited users

FTC suing AT&T over
Not too long ago, it was revealed that AT&T (unsurprisingly) was using some shady methods to push wireless subscribers away from the old unlimited plans and towards newer limited data plans. Word was that although AT&T was claiming it needed to "manage" its network by throttling some high-usage customers, it was actually only targeting those on old unlimited plans. Now, the Federal Trade Commission (FTC) is suing AT&T over those "deceptive" practices.

According to the FTC post on the matter: 


Ultimately, the FTC is alleging that AT&T has misled customers, because while "unlimited" should mean unlimited, it actually doesn't under AT&T's rules. Instead, AT&T has put restrictions on what are supposed to be unlimited plans, with the not-so-subtle plan to get people to switch off of those legacy plans and onto newer data tiers. The reason the FTC believes it has a case is because AT&T instituted these throttling policies after the fact, effectively changing the terms in the middle of a contract. 

Not surprisingly, AT&T doesn't agree with the FTC's view of things, and is using some pretty creative excuses as to why what it has done is legal. First of all, as is the way of an entrenched power, AT&T went with the classic "everyone does it" defense (which is the same excuse you'd get from a cable company if you ask why you can't simply pay for the channels you want, or buy your own cable box), and followed that up with the very interesting defense that the few customers who were affected were notified by text, and also should have seen one of the "nearly 2,000 news stories" about the changes. 

It is hard to argue that customers didn't know about the change, but according to the FTC, that's not the point, because you can't change a contract with a national press release and SMS message.

source: FTC via The Next Web

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38 Comments

1. Busyboy unregistered

Good, they deserve to be sued. Bs deceptive marketing.. If you market unlimited, make it truly unlimited!

20. jaytai0106

Posts: 1888; Member since: Mar 30, 2011

Yeah and I hope AT&T will get a huge fine. However, I still wonder why people use so much data sometime lol

23. DontHateOnS60

Posts: 872; Member since: Apr 20, 2009

Porn and streaming netfllix and music 6 hours a day.

2. bugsbunny00

Posts: 2264; Member since: Jun 07, 2013

O'OH BUSTED!!

31. Nobodey

Posts: 76; Member since: Jan 03, 2010

Busted for what? They made an announcement July 29th of 2011 that this would be the case from November 2011 on. As for the definition of "unlimited", its still unlimited soup, salad and breadsticks even if your waitress is busy helping another customer. Just because you have to be a little more patient does not mean you are not still getting unlimited.

33. Nobodey

Posts: 76; Member since: Jan 03, 2010

*October, not November, sorry.

3. hitechredneck

Posts: 103; Member since: Nov 21, 2011

total BS. Look at the fine print of other carriers when you use to much roaming and they have right to terminate service. Tmobile throttles you to 2G speeds when you reach your limit of 4G LTE. It's all in the fine print at the bottom of the page and in the terms of service. Don't believe me look up the different carriers and scroll down to the bottom of the pages and read the fine print of other carriers. Like they said it only affects 3% of the customers and at least they give you a heads up.

5. bugsbunny00

Posts: 2264; Member since: Jun 07, 2013

nevermind about tmobile at&t got busted and thats today's game..

9. Slammer

Posts: 1515; Member since: Jun 03, 2010

Are you a consumer or a jocky for a carrier you work for? Because quite frankly, how you view this depends on what side of the line you're on. In any other industry if this happened to you, I can bet you would look at it differently. It doesn't matter what is in the terms as much as how the carrier handles the terms it wrote. This BS by any carrier. John B.

14. GTRagnarok

Posts: 48; Member since: Aug 22, 2014

There's no fine print with T-Mobile. They lay it out pretty plainly when you're picking your plan. You can choose between 1GB, 3GB, or 5GB of LTE data, after which you are throttled (again, they're not hiding this. It's plainly stated in normal text). There is also an option for unlimited LTE, which is actually unlimited with the only restriction that only 5GB can be used for tethering. I'd imagine this is to prevent people from using T-Mobile's data as their main ISP, which would suck T-Mobile's network dry really quick.

17. Gdrye

Posts: 111; Member since: Jan 02, 2012

if you think that T-mobile or any carrier has no fine print i have a boat i can sell you

22. GTRagnarok

Posts: 48; Member since: Aug 22, 2014

Don't get me wrong, I don't mean no fine print literally. But we're talking about the issue of throttling unlimited plans. If you can show me where T-Mobile says they will throttle the $80 unlimited LTE plan, then I'll eat my words.

25. hitechredneck

Posts: 103; Member since: Nov 21, 2011

Full speeds available up to monthly allotment; then, slowed to up to 2G speeds for rest of billing cycle. thats at the bottom of the family plan for $100.

26. hitechredneck

Posts: 103; Member since: Nov 21, 2011

also at the very end it says: Service may be slowed, suspended, terminated, or restricted for misuse, abnormal use, interference with our network or ability to provide quality service to other users, or significant roaming.

36. GTRagnarok

Posts: 48; Member since: Aug 22, 2014

I'm seeing it costs at least $140 ($80 for the first line, $60 for the second) for the family plan for two to have unlimited data. $100 family plan means neither lines have unlimited data.

29. g2a5b0e unregistered

I can't show it to you because I don't have the plan anymore & I don't know if it's still the case or not, but they used to throttle the unlimited data at 9,765GB. Yes, you read that right. Almost a terabyte. It was always noted in the box on the website that showed my usage for the month. No idea why they chose such an ungodly amount. I did the math on it. You would have to be using data at a rate of 30.2Mbps non-stop for the entire month straight to hit that. Absolutely insane!

32. Jmurder209

Posts: 6; Member since: Mar 02, 2011

Ya, But What The FTC Is Saying Which Is True, Is That When AT&T First Started Their $30 Unlimited Data Plan, When The iPhone First Came Out, It Didn't Have That Throttling Back Clause In The Fine Print. Because Back Then The First iPhones Max Speed Was 2G Edge, So AT&T Couldn't Throttle You Back. What Their Saying Is That AT&T Added That Clause After The Customer Already Signed The Contract, So They Unfairly Changed The Contract Without The Customers Approval Or Consent. The Biggest Reason I Recently Gave Up My Grandfathered $30 Unlimited Data Plan For The $160 30GB Family Share Plan, Was Because've That Throttling Back Clause. Also Because You Can't Use The Mobile Hotspot Feature, Which In My Opinion Should Be Free, It's My Unlimited Internet, I Should Be Able To Use It On Anything I Want, I Wish The FTC Would Sue For That!! If The FTC Would've Done This Earlier, Then Maybe I Would've Kept My Grandfathered Data Plan? Sorry For The Long Comment/Rant.

37. Bigtalker

Posts: 15; Member since: May 19, 2014

So what you're saying is you signed a 10 year contract?

4. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

It's about time that the government comes down on the fascist crooks at ATT. What ATT did is a classic "bait and switch" -- advertise "unlimited" like crazy, get lots of people to sign up for "unlimited", and then take away the "unlimited" shortly thereafter. In most places, ATT has plenty of bandwidth for true unlimited data. They just want insane profits for data. Even if unlimited data were $10/month, ATT would still make a profit on it. But ATT wants $100+/mo for unlimited data now because the $30/month is only a 67%+ profit margin.

21. johnbftl

Posts: 283; Member since: Jun 09, 2012

First off, do you know what the definition of a fascist is? They're a capitalist company trying to get the most bang for their buck. Secondly, they didn't advertise unlimited like crazy, then pull the rug out from everyone after a short period of time. Unlimited was sold when it was a feasible thing. This is when smartphones like the BlackBerry and Palm Treo weren't hogging bandwidth. Even the original iPhone for that matter. Less people had these high powered devices that congested the network. Now that most everyone has a smartphone and networks are still being optimized for 4G LTE, we are seeing data limits increase quickly. It went from 3GB limits to 100GB limits. As networks are fitted properly and VoLTE takes over, you will see a trend back to unlimited.

24. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

You probably think a fascist is a German man with a mustache and capitalism is a giant US corporation reaming consumers. AT&T is a massive corporation whose dominance and market duopoly is due in large part to an effective alliance with the state. If this is not fascist, I don't know what is. There is no trend towards unlimited. There is a trend to charge a lot for data so giant corporations can make enormous profits. Unlimited data could be offered for $10/month and still generate profits. But cell phone plans still ream consumers for pitiful amount of data -- 250MB for instance is the entry level AT&T plan. The FTC is absolutely right to bring about this lawsuit. It's late to the party, but AT&T has been abusing consumers and skirting the law for a long time.

30. johnbftl

Posts: 283; Member since: Jun 09, 2012

Oh, I'm sorry. I'm not another kid that trolls on here. I majored in history at California State University of Long Beach. But since you seem to not know what fascism means, here's a definition: fascism [fash-iz-uh m] noun 1. (sometimes initial capital letter) a governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism. Let's break that definition down, and how it pertains to AT&T. AT&T is not a governmental system led by a dictator. They don't seem to have much sway with this government for that matter seeing as they couldn't get them to approve the T-Mobile takeover. AT&T cannot suppress opposition and criticism. That's been proven by T-Mobile's ad campaign and Verizon being a bigger company than them. AT&T by no means regiments it's industry nor does it demonstrate racism. Now let's look at the definition of capitalism: capitalism [kap-i-tl-iz-uh m] noun 1. an economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations, especially as contrasted to cooperatively or state-owned means of wealth. AT&T is a publicly traded corporation that produces and distributes a service. That would be a capitalistic idea. If you believe for a second that charging $10 for unlimited data would generate profit, you have no idea how much their overhead is. They are a Communications Workers of America union company. That union negotiates great pay for their employees as opposed to most other carriers. My hourly as a rep was $17. When I moved to Connecticut andwent to Sprint as a manager I made less. They also have superb benefits. So great in fact that I had 5 surgeries, chemotherapy, and 17 overall hospital stays in 2012 when I had cancer and I have no medical debt. They have something called Summit every year for top performers where they fly them and a guest out, all expenses paid to celebrate and have a banquet. Maintenance on cell sites is not cheap. You don't just erect a tower, turn it on and walk away. Outside of the up costs of you know, buying the land to build a tower, paying an engineering team to build it, paying for materials, and the likes there are other costs. You have to pay for bureaucracy. Red tape. Regulations within a city for what a tower needs to look like and how well it's hidden. Push back from residents. Voting to get it built. One tower can take years to get going. All that takes money. $10/month per customer to jam up the network is not enough to turn a profit. Fyi, I'm a Jew. I've known Holocaust survivors at my synagogue in California. That little German man is a fascist. So are Vladimir Putin, Joseph Stalin, Kim Jong-In, Ali Khamenei of Iran, Saddam Hussein, and Benito Mussolini. Refer back to the definition above.

34. Jmurder209

Posts: 6; Member since: Mar 02, 2011

YOU TOLD HIM!!!! Way To Go My Jewish

35. Nobodey

Posts: 76; Member since: Jan 03, 2010

This is the internet. Facts and reason have no place here.

6. Sdotreznikk

Posts: 9; Member since: Oct 28, 2014

How's it bait and switch? They stopped selling Unlimited Data and they didn't start throttling for long after that. Secondly at least AT&T let's you keep Unlimited Data, Verizon took it away if you upgraded. This lawsuit is bologna they should be suing all wireless providers then tmobile and sprint included.

10. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

AT&T made a unilateral change to their contract, i.e. removed unlimited data, without any consideration for the customer. This sort of one sided contract and the ability to change it at will is a huge problem. It really should be illegal, but because AT&T has bought the government, they do whatever they want. The lawsuit is late to the party, but a good lawsuit. Nearly the entire American economy will benefit from cheap data plans. This systemic greater good is more important than AT&T, Verizon and others being able to extort the public and suck obscene profits out of the system for the benefit of telecom execs and shareholders only.

12. VLaRueC

Posts: 189; Member since: Dec 18, 2012

The plan for those people on unlimited plans would have been untouched if they didn't take a subsidised phone offer. I see no harm in what they did. In fact, I'd say AT&T has done more than other carriers in regards to keeping unlimited.

15. Slammer

Posts: 1515; Member since: Jun 03, 2010

---"The plan for those people on unlimited plans would have been untouched if they didn't take a subsidised phone offer."---  Yes,, but what did AT&T claim in order for these people to switch? From the sounds of the thousands of complaints, it appears AT&T was up to no good. And I think this is the bone of contention that hits at the belt line. John B.

16. VLaRueC

Posts: 189; Member since: Dec 18, 2012

They claimed that if they want a subsidized phone on their unlimited plans, there would be additional terms in conditions including the option of throttle service. I'll go ahead and play this lawsuit out. AT&T will present the terms and conditions that customers had the ability to read. Lawsuit over thrown out.

19. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

"The plan for those people on unlimited plans would have been untouched if they didn't take a subsidised phone offer." You are confusing Verizon unlimited with AT&T unlimited. AT&T has no subsidy dependency. All AT&T unlimited data plans got reduced down to 5GB from "unlimited". After 5GB, there will be throttling and/or cut-offs. Of course AT&T lets you keep "unlimited". It is just 5GB of full speed data at a price where they are still making a fantastic profit.

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