FTC Sues AT&T Over 'Misleading' Unlimited Data Throttling Practices [Updated]

[SinatraLennon]

I hope that something good for the customer comes from this.

I've been an AT&T customer since the late 1990's. I bought the first iPhone on the day it launched in 2007, at the NYC 5th Ave. Apple Store. I know that customer loyalty makes no difference to a behemoth of a company like this, but I am nearing the end of my rope with this throttling nonsense. I have noticed severe drop offs in data speed when I use over 5GB of data. So severe, that the phone becomes almost unuseable.

For us long standing customers, throttling is a slap in the face and shows complete disregard for us as paying users.

I don't expect to be given anything for free, just give us the chance to have a useable device which we pay monthly to use.

 

[JackieInCo]

So, again, what's not fair?

Umm that people on AT&T don't have true unlimited data?

 

[Fiestaman]

Then leave and never look back. I don't understand all the angst, especially with all the competition out there.

I don't understand all your ignorance, but oh well. I did leave and I'm not looking back. Did AT&T get you new kneepads yet?

 

[kugino]

he said she said. i'm sure att and their cadre of lawyers will somehow get this settled in their favor.

best way to stick it to att is to leave. simple as that. yes, all the telcoms are crooks to some extent, but some make it more difficult than others (yes, att has more hoops and restrictions than tmobile, though there are tradeoffs to switch to tmobile). in the end, i don't see this making a significant impact on we the end users. how about the FTC stop letting these giant telcoms becoming veritable monopolies? maybe that might give us more choices, better service, etc.?

 

[popeye88]

Could someone explain why AT&T grandfathers some plans? Are they legally obligated to do so? What is preventing them from simply forcing anyone who upgrades a phone to use one of the new data plans?

My guess it's a retention strategy. I have suggested to their customer care in the past that I was considering switching due to an issue, and they reminded me that if I did so, I would lose my grandfathered unlimited data. I think they know that they would take a pretty big hit in subscriber losses if they just cut everyone off at once.

 

[rjohnstone]

rjohnstone,

That qualifies as smoke and mirrors...

Bryan

That's BS and you know it.
It's a legal contract. And yes, it's full of legal "outs" set heavily in AT&T's favor.

My T-Mobile contract has some similar language.
Even T-Mobile does not guarantee the data rate. They only say they will not "intentionally" slow down my connection as I have opted to pay for an unlimited high speed data plan.

It's a matter of picking the lesser of two evils.

 

[kwalt1989]

AT&T made the mistake of offering unlimited in the first place. It doesn't matter if they were making other people buy 1GB for $100 if they agreed to give you "unlimited" in your contract, then they should have to honor that. I'm on a tiered plan and I can see why a lot of people are angry about this. It's not fair to me, because I have to pay for what I use, but I would be saying the same things if I still had unlimited. Honor your agreements AT&T, you low life pieces of ****!

 

[SAD*FACED*CLOWN]

Could someone explain why AT&T grandfathers some plans? Are they legally obligated to do so? What is preventing them from simply forcing anyone who upgrades a phone to use one of the new data plans?

It's simply a courtesy. A means of customer retention.

 

[jonathan1683]

I would switch immediately if they took away unlimited to Verizon. I only got throttled once and it rendered my phone almost useless. I wouldn't mind something usable and throttled. I wasn't even on 4g either. I was also on my microcell and they still throttled through that which I have to use because they dont have service in my house. I talked to every manager i could get to get them to remove and and no one would budge.

 

[TallManNY]

Wow.

Free ride? No one received the unlimited data plan for free. Those of us that have it, have been paying for it. And the majority of us have been paying more then the average data used for lower-cost plans. So in reality, AT&T has been making out on the deal.

And if you want to talk about a thick skull, what's not to understand about the word unlimited and what it means in the English language? Unlimited means without limits. If you can't understand that, then please go back to school and study the English language to better understand what it means.

AT&T is the one that offered us the ability to purchase an unlimited plan and we purchased it. These carriers should not be allowed to use "smoke & mirrors" to deceive people when entering into an agreement. Unlimited should be unlimited, simple as that.

Bryan

Is your plan currently available for new folks to sign up on? No. Do you wonder why? It is because it was a stupid thing for AT&T to offer. They now understand much better how much bandwidth can be used by iPhones and their customers.

AT&T should just end the plans and switch everyone over. Then you can sue them for breach of contract because you believe you now have an inalienable right to use AT&T's network as much your device and you can manage. You do believe that you have a loophole, hence you do believe you have a free ride. You do believe that other AT&T customers will pay more and you will pay less. If you don't see that you are delusional.

 

[miniyou64]

Charming to see all the "yay this is so great" responses for the government intervention, which created the duopoly in the first place. Sad that people don't understand private contracts free markets and freedom in general...

 

[giantfan1224]

Umm that people on AT&T don't have true unlimited data?

Hence why you're with T-Mobile instead, right? It's not like we're standing in a breadline hoping we're allocated the better of the carriers so we don't have to suffer with the worst.

 

[ktuck]

The FTC just got my complaint (text below) emphasizing that I paid a premium in exchange for the assurance that I would have unlimited data in the future, when it was usable.

It's my understanding that a high percentage (between a third and a half) of AT&T's smart phone customers are on the Unlimited Data Plan. Presumably, any customers that tried to use more than a couple of GB's per month discovered that it's nor really unlimited and have switched over to a less expensive plan. So that means that 44% of AT&T's customers are in the dark about their service and are significantly over-paying.

So, with the big dollars involved, it makes sense that AT&T does actively promote retention of Unlimited Data Plan customers. When I first realized that my Unlimited Data Plan only included useless unlimited data, I spent hours on the phone with AT&T trying to reach a resolution and they offered me absolutely nothing in return for my years of over-paying. I think a painless and fair concession would have been to offer me a 10GB plan at the cost of the 2GB plan, but my request fell on deaf ears.

Hopefully, the FTC will get AT&T's attention. Can you hear me now?


My FTC complaint:
AT&T sold me an Unlimited Data Plan, NOT BECAUSE I NEEDED IT THEN BUT BECAUSE I WOULD WANT IT IN THE FUTURE. Our home area has very poor data reception, so I was never able to use any appreciable amount of data on my phone. But, year after year, I renewed the Unlimited Data Plan because AT&T's representatives told me, time after time, that THE CONSIDERABLE EXTRA COST WOULD BE RETURNED AT SOME POINT IN THE FUTURE when cell phone data became more useful and simultaneously, more expensive. In August-September 2014, while traveling, for the first time ever, I was able to use a large amount of data but was surprised to receive a warning from AT&T that I was about to exceed my limit of high speed data and would be throttled down to an unusable data speed. Whe I complained AT&T argued that they were forced to do this in order to keep heavy data users from bringing down their system (not true) and that the data throttling provision had been adequately explained in their billing literature (not true). When asked why their representatives were trained to promote the purchase of unlimited unusable data, they replied that the slow-speed data is, in fact, usable and valuable (not true). When I asked sales representatives why someone would pay so much more for an unlimited data plan, they replied "Because it's unlimited; you can use as much as you want" (not true). A month after this experience, I switched to a plan that equally meets our needs (except without the assurance of unlimited future data) and costs about $70 per month less. AT&T was unwilling to compensate me for all of the years I had paid to keep my Unlimited Data Plan grandfathered in.

 

[TallManNY]

If AT&T doesn't want it, they shouldn't have sold it.

Unlimited means what it says, and customers have a reasonable expectation that if you sell it that you are going to make a good faith effort to provide it. This imaginary world where AT&T is going to weasel out of a contract by the letter of the law doesn't exist. AT&T is a very large company, they should have been taken to task about this long ago, and there is zero reason to throttle a paying unlimited customer if they are not congesting the network at a particular time.

Large companies like AT&T have a tendency to try and squeeze customers via their pricing models and user hostile policies because their customers have no other choice. The FTC knows that a company is supposed to win by virtue of better service, not by playing games with their users. Which side do you think this falls on?

I honestly think that AT&T is not playing games here. There is this small percentage of their customers who are paying a small amount of money in comparison to the amount of bandwidth that they are using. AT&T is trying to find a solution for these folks. What AT&T should do is just cancel all the unlimited plans and deal with the fall out. They were stupid to have offered unlimited. The technology just does not work that way. It is not an unlimited resource. The other companies can offer not because they have better service but because they have such a small customer base they are danger of going out of business.

But they are a big company and it wouldn't even be the end of the world for us if they went bankrupt because of this issue.

But for the whiners on this thread who entered into a contract with AT&T knowing full well that they were going to exploit it and use tons of bandwidth and get more than they paid, I've got no sympathy. It is like the heavy eater who doesn't eat all day and then just goes in and destroys the all you can eat buffet. Am I supposed to be impressed? Is that supposed to be a "good person"? No that is a jerk. And if you are using tons of bandwidth on a contract that you know is vastly below market price, then I'm also not impressed. You are exploiting a legal loophole. Sure it is one that AT&T made for itself. But that doesn't make me want to be on your side.

 

[ToroidalZeus]

That's BS and you know it.
It's a legal contract. And yes, it's full of legal "outs" set heavily in AT&T's favor.

My T-Mobile contract has some similar language.
Even T-Mobile does not guarantee the data rate. They only say they will not "intentionally" slow down my connection as I have opted to pay for an unlimited high speed data plan.

It's a matter of picking the lesser of two evils.

terrible mentality to have and i hope you never work as a lawyer.

a contact (or terms of service) aren't legal until the text is backed up by enforcement of law. Until a court rules AT&T has the right to throttle data it isn't legal even if you signed the contract and their loop hole allows for it.

 

[giantfan1224]

I don't understand all your ignorance, but oh well. I did leave and I'm not looking back. Did AT&T get you new kneepads yet?

Ignorant as to why you're still so bitter with a phone carrier that you left years ago? You're acting like a jilted ex-boyfriend that never got closure.

 

[ToroidalZeus]

I honestly think that AT&T is not playing games here. There is this small percentage of their customers who are paying a small amount of money in comparison to the amount of bandwidth that they are using. AT&T is trying to find a solution for these folks. What AT&T should do is just cancel all the unlimited plans and deal with the fall out. They were stupid to have offered unlimited. The technology just does not work that way. It is not an unlimited resource. The other companies can offer not because they have better service but because they have such a small customer base they are danger of going out of business.

But they are a big company and it wouldn't even be the end of the world for us if they went bankrupt because of this issue.

But for the whiners on this thread who entered into a contract with AT&T knowing full well that they were going to exploit it and use tons of bandwidth and get more than they paid, I've got no sympathy. It is like the heavy eater who doesn't eat all day and then just goes in and destroys the all you can eat buffet. Am I supposed to be impressed? Is that supposed to be a "good person"? No that is a jerk. And if you are using tons of bandwidth on a contract that you know is vastly below market price, then I'm also not impressed. You are exploiting a legal loophole. Sure it is one that AT&T made for itself. But that doesn't make me want to be on your side.

Public image and reputation is important too.

 

[giantfan1224]

It's my understanding that a high percentage (between a third and a half) of AT&T's smart phone customers are on the Unlimited Data Plan.

Source? My guess is that's way too high.

 

[TallManNY]

How come I can use 75GB of data on T-Mobile and pay less per month and not get throttled and those on AT&T pay for unlimited and get throttled after 2GB or 5GB depending? Is that fair?

Because T-Mobile has a subscriber base so small that they have frequently been the subject of takeovers and rumors of their bankruptcy. They have the bandwidth.

Also have you really ever used 75gb in cell data in a month? That is amazing. How did you do it?

But seriously, shouldn't you pay for what you use?

----------

Incidentally, I'm not a fan of AT&T, Verizon or the Cable Companies. And in fact I think that internet access is a public good like electricity, water and waste disposal. I think the AT&T and the cable companies should be regulated like the electricity company. And then we should all pay a small, sensible rate per bit of data we use.

But until that day comes, I don't want congested networks in my area because someone is trying to live a broadband life through their cell phone. Get on wifi if you have some serious downloading to do.

 

[FieldingMellish]

Edith Ramirez has unlimited AT&T data service on her IPhone?

 

[EnderTW]

So like others my first reaction is that of COURSE unlimited means unlimited and that they shouldn't throttle after a certain amount. I have Verizon unlimited and enjoy that's it's truly unlimited and I can use it as a hotspot too. AT&T's perspective is generally that they are giving you an unlimited amount of data but controlling how fast you can actually use it.

Let me ask a similar question.

If I go into a restaurant that heavily advertises unlimited breadsticks, can I reasonably expect UNLIMITED breadsticks? Or is it reasonable for the restaurant to say sure, it's unlimited, but we'll only bring out 1 per person at the table at a time?

I think we'd mostly agree that the latter is acceptable and that a request for 1000 breadsticks would be declined. Is that really any different than what the carriers face, where 95% of customers use 2GB or less and probably 5% are far more than the other 95% combined?

Certainly bandwidth is less of a tangible quantity than a breadstick -- it's harder to argue that I am being wasteful by using 100GB. But, let's not act like bandwidth is an unlimited resource, either. It does cost money to expand capacity and if the bulk of that is being forced by a few users sucking down enormous amounts of data then they are indeed a very real cost to the carriers and to all of us.

Dunno what the right answer is, but I do think it's far more complex than the FTC's argument that unlimited means unlimited.

You said it yourself. Breadsticks and bandwidth are not one and the same. You're argument is based on us rationalizing that they could be similar. They're no where similar.

1) a local restaurant is not one and the same as a national celluar company.
2) breadsticks do not face the same resource problems as bandwidth.

Is it reasonable to expect thAt your cellphone works in one method of use and the same way after you "consume" hundreds of YouTube videos? Absolutely. Why wouldn't it.

It's not reasonable to expect 1000 breadsticks. For the reasons you mentioned. Doesn't mean they're related though to the situation at hand.

What Att will probably do if they lose is terminate unlimited plans. Which they have every legal right to do.

 

[Gutwrench]

I got roped into switching to the 30GB family share plan (with 3 people) a month ago. I got throttled and pissed off and since the double data promotion looked so good, I switched plans. But first they made a note to let me switch back to my unlimited plan if I decide I don't want the share plan by the end of the promotion.

Does this signal enough of a change that I should switch back while I still can? Tethering is preettttty nice, but unlimited is way more than 30...

My guess is with three people on unlimited it ran you about $220-$240/mo.
If you downgraded to 30g family share last month (the analysis of your usuage indicated to you to be enough) then the "double" promotion allowed you to get the 15g plan. Therefore your monthly bill is now probably around $140-$150 and you get to tether. If your consumption habits don't exceed 30g then why go back to paying a $75-$100 premium more per month just for unlimited and surrender tethering to boot?

 

[Bryan Bowler]

That's BS and you know it.
It's a legal contract. And yes, it's full of legal "outs" set heavily in AT&T's favor.

Sorry, but what I said is not BS. Please show me in the contract where it spells out that with an unlimited data plan I can only use 3 GB a month before being throttled to a particular speed and what that speed would be? It doesn't say that, nor does it even suggest it.

AT&T advertises the opportunity to give me an Unlimited data plan every time I renew a contract with them. And even though Unlimited should mean unlimited, it's not, and they don't even come close to even remotely spelling out the true terms in their contract.

That is smoke and mirrors...

Bryan

 

[rjohnstone]

terrible mentality to have and i hope you never work as a lawyer.

a contact (or terms of service) aren't legal until the text is backed up by enforcement of law. Until a court rules AT&T has the right to throttle data it isn't legal even if you signed the contract and their loop hole allows for it.

I hope not either.
I like the job I have better.

As for the TOS, I don't have the time or desire to fret over it.
I didn't like what it had become.
I used my out (paid my ETF) and walked. It was pocket change.

I'll let people with deeper pockets deal with the legal challenges.

Sorry, but what I said is not BS. Please show me in the contract where it spells out that with an unlimited data plan I can only use 3 GB a month before being throttled to a particular speed and what that speed would be? It doesn't say that, nor does it even suggest it.

AT&T advertises the opportunity to give me an Unlimited data plan every time I renew a contract with them. And even though Unlimited should mean unlimited, it's not, and they don't even come close to even remotely spelling out the true terms in their contract.

That is smoke and mirrors...

Bryan

Read the entire 6.2 section I posted. They use terms "restrict" or "limit" instead of actual numbers. It's called being legally vague. The minute you throw a number out there, you have to commit to it.
I can see why AT&T's lawyers refrained from putting hard numbers in the TOS.
Wireless service speeds can never be guaranteed. Carriers use descriptive terms instead of numbers since there are so many variables that can impact service.

The term "unlimited" is defined in the contract.

If you are a grandfathered AT&T unlimited plan data service customer, you agree that “unlimited” means you pay a fixed monthly charge for wireless data service regardless of how much data you use.

You further agree that “unlimited” does not mean that you can use AT&T’s wireless data service in any way that you choose or for any prohibited activities, and that if you use your unlimited data plan in any manner that is prohibited, AT&T can limit, restrict, suspend or terminate your data service or switch you to a tiered data plan.

Now I'm no lawyer, but even I know exactly what the heck they're talking about here. I do not see a single mention of how fast your service will be, only that they can restrict what ever it is if they feel you are using data in a prohibited manner.

 

[burnside]

If the reason to throttle unlimited plans is because of the stress on the network, why doesn't AT&T cap the number of 5GB+ plans out there? I'm guessing there are more tiered plans using 5GB+ per month than unlimited plans using 5GB+. It all comes down to $$$ and forcing those with grandfathered plans onto the tiers.