The U.S. Federal Communications Commission on Wednesday announced that it will slap AT&T with a fine of $100 million after finding that the wireless carrier mislead customers about data throttling on data plans that were advertised as “unlimited.”
“Consumers deserve to get what they pay for,” FCC chairman Tom Wheeler said. “Broadband providers must be upfront and transparent about the services they provide. The FCC will not stand idly by while consumers are deceived by misleading marketing materials and insufficient disclosure.”
The FCC found that the company did not adequately inform its “unlimited” data plan customers of the potential for data throttling. This violated the Open Internet Transparency Rule, which mandates that “broadband access providers disclose accurate information sufficient to enable consumers to make informed choices regarding their use of broadband Internet services and to ensure they are not misled or surprised by the quality or cost of the services they actually receive.”
AT&T denied any wrongdoing, and in a statement said:
“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 Federal Trade Commission also filed suit against AT&T in October 2014, over basically the same issue, charging that as many as 3.5 million customers of the wireless carrier faced speed reductions of up to 90% of the advertised speeds. It’s not clear what effect today’s announcement may have on the FTC’s lawsuit.
