The Federal Trade Commission has accused the second largest wireless carrier in the country of “throttling” users’ unlimited data plans. The FTC alleges in a law suit filed this week, that AT&T has been selling unlimited plans and then reducing the speed of data heavy users by as much as 80 to 90 percent.
AT&T has been throttling users data speeds since October 2011 and impacts any user who surpasses a data threshold as low as 2 GB in a month. This data threshold can be reached in just seven hours of streaming HD video, according to AT&T’s dedicated data calculator.
The FTC said the throttling has resulted in slower speeds for users on 25 million occasions to the point where speeds were comparable to dial-up Internet. On average, 3.5 million users experienced slowdowns for about 12 days per billing period, which prompted thousands of complaints about the wireless company.
AT&T has responded calling the allegations “baseless” and asserted that throttling was a measure necessary to manage the company’s network resources. “We have been completely transparent with customers since the very beginning,” said AT&T’s general counsel, Wayne Watts. “This program has affected only about 3 percent of our customers, and before any customer is affected, they are also notified by text message.”
It’s one of the FTC’s most aggressive lawsuits for Chairwoman Edith Ramirez, a former corporate lawyer who assumed the position last year. By challenging one of the nation’s largest wireless providers, Ramirez is ruffling feathers with sister agency, the Federal Communications Commission, which typically handles issues with telecommunications despite being a bit too chummy with wireless corporations and often seen as not aggressive enough in regulating the wireless corporations practices.
“AT&T promised it’s customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” Ramirez said. “The issue here is simple: unlimited means unlimited.”
While the FTC is seeking financial damages that could result in AT&T unlimited data users being repaid for having their usage restricted, AT&T is merely telling it’s customers to use their phone’s WiFi capability or switch their data plans if they are unhappy.
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