FTC sues AT&T for Throttling

jonathon@pricingdataplans.com

FTC sues AT&T for ‘deceptive’ and ‘unfair’ data throttling

FTC sues AT&T for unfair throttling

FCC sues AT&T over data throttling

It is not a typo, this is the FTC (Federal Trade Commission) not the FCC.  It seems everyone is on the Telco’s case these days.  So did the FTC simply beat the FCC to the punch here, or is there something else at work?

While not being a lawyer, I won’t give a legal opinion, but that doesn’t mean I don’t have one.  The practice of slowing down traffic once a particular subscriber has reach a certain monthly volume is a certainly an industry-wide practice.  After all, there has to be some way for operators to correlate between costs and network usage.

  • The complaint alleges that the mobile service provider charged millions of customers for “unlimited” data plans while cutting data speeds, sometimes by nearly 90 percent. This practice of slowing down speeds to near-impractical levels after the user has crossed a usage threshold is called data throttling.
  • “AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” said FTC Chairwoman Edith Ramirez in a statement. “The issue here is simple: ‘unlimited’ means unlimited.”

AT&T’s reply:

  • “The FTC’s allegations are baseless and have nothing to do with the substance of our network management program,” Wayne Watts, AT&T senior executive vice president and general counsel, said in a statement.
  • He added that the case was “baffling” and that the company has been “completely transparent with customers since the very beginning,” including a well-reported press release on the matter in 2011.
The key in this case (if it ever make it to a court room) is not the practice, but the clear labeling of the product.  Many operators are not transparent enough in their marketing and packaging.  Consumers should have a clear understanding of what they are buying and expect to receive just that.  Operators should be able to optimize their networks to maximize efficiency and capacity.  These two points are not mutually exclusive.

 More Here… [CNBC] …[WP] … [Time]

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