AT&T is once again in hot water because of its data throttling practices.
The Federal Communications Commission (FCC) announced today that it will fine AT&T $100 million for misleading customers with its unlimited wireless data plan.
This is the second time that the company's data throttling has gotten it into legal trouble.
'Unlimited means Unlimited'
According to the FCC, AT&T's advertising promised unlimited data plans. However, the company capped data speeds after customers used a certain amount of gigabytes of data within each billing period. Then, AT&T throttled, or slowed down data, by 90 percent to dial up speeds.
The company does not necessarily dispute that it throttles data. AT&T argued that the FCC previously approved of the practice as a legitimate way to manage resources. AT&T also claims that it fully disclosed the practice to customers through a disclosure on the company's website.
The FCC challenges that AT&T was not fully transparent about its throttling practice leading customers to believe that they were getting fully unlimited data.
AT&T has said that it will challenge the fine. If AT&T loses the challenge, the $100 million fine will be paid to the U.S. Treasury. AT&T customers will not receive any money from the fine. Instead, they may benefit from faster unlimited data.
Federal Trade Commission Lawsuit
However, AT&T customers may see some financial compensation if the telecom company loses the lawsuit filed by the Federal Trade Commission.
Late last year, the FTC filed a lawsuit against AT&T for similar reasons. The suit, filed in U.S. District Court in San Francisco, claims that AT&T's practices are deceptive.
AT&T has promised to vigorously fight this suit. The company points out that it sends email and text-notifications to customers telling them when they crossed pre-set limits and that they're data speed would be slowed.
As a result of the FCC fine and FTC lawsuit, could AT&T customers expect an end to data throttling? We'll have to wait and see.
- FCC Plans to Fine AT&T $100 Million Over Capping of Unlimited Plans (The Wall Street Journal)
- iPhone User Awarded $850 in ATT Throttling Case (FindLaw's Technologist)
- AT&T 'Cramming' Settlement: $105M for Bogus Cell-Phone Charges (FindLaw's Decided)
- Attorneys' Failure to Read a Document Costs AT&T $40 Million (FindLaw's In House)