The Federal Trade Commission today announced that it is suing AT&T for deceptively selling "unlimited" data plans that were actually quite limited in practice.
Even though AT&T hasn't allowed new customers to sign up for an unlimited data plan in years, many AT&T customers have held on to their grandfathered unlimited plans thinking that they were actually something special.
But the truth is - AT&T has long throttled speeds for users who exceed 3GB of 3G/4G data or 5GB of LTE data on these unlimited plans, making them in practice a poor deal.
AT&T just a few months ago changed its policy to only throttle unlimited users when the network was congested (which it almost always is in many areas), but before then users would be throttled regardless of network load once they had exceeded their monthly limit. And even now - "unlimited" plans are singled out for throttling on congested towers while regular tiered data plans are all treated identically.
The heart of the FTC's complaint is that AT&T knew from their own internal focus groups that customers who understood the throttling policies thought that it "seems a bit misleading to call it Unlimited” - and knowing this AT&T intentionally misled customers to keep them from switching to another carrier. The FTC considers AT&T's behavior to be "Misrepresentations or deceptive omissions of material facts."
“AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise. The issue here is simple: ‘unlimited’ means unlimited.” - FTC Chairwoman Edith Ramirez.
The FTC complaint notes that over 3.5 million unique AT&T customers have experienced being throttled.
AT&T of course is claiming that these allegations are "baseless" - claiming that they have been "fully transparent and consistent" with customers.
But in our experience, the message certainly hasn't gotten through to their customers. We constantly run across AT&T customers in the RVing community with "unlimited" plans who think that they actually have something worth holding on to, and only rarely do the AT&T unlimited customers we talk to realize that they are being throttled.
This will be an interesting case to watch - and we will be keeping our eyes on it as it moves forward.
Mobile Internet Resource Center (dba Two Steps Beyond LLC) is founded by Chris & Cherie of