The FTC is suing AT&T for promising unlimited data, only to later slow speeds to a crawl



Concerned with deceptive and unfair data throttling, the Federal Trade Commission — who works for consumers to prevent fraudulent business practices —  is suing AT&T for deceptive and unfair data throttling related to the company’s once advertised “unlimited data” data plans.

According to the FTC, AT&T knowingly misled consumers by charging consumers for unlimited data, but later reducing these speeds by as much as 90% as a result. It’s really not too uncommon and we’ve seen T-Mobile and other carriers use a similar business tactic in regard to their “unlimited” data plans. The difference? Those are all tied to a guaranteed number of gigabytes consumers can expect to receive high-speed data.

AT&T is a different case in that the FTC feels they never fully disclosed to those on unlimited data plans that they would be throttled into oblivion, reducing their service after as little as 2GB of usage. For some customers, it pushed them to the brink, eventually causing them to forfeit their lines of service and eating hefty early termination charges. Anyone who’s tried to use their Android device while on Edge (2G) knows how pull-your-hair-out frustrating this can be whether it’s loading a web page, streaming music or video, or just trying to load up GPS/navigation — it’s damn near impossible.

For customers grandfathered into unlimited data (after AT&T made the move to tiered data), the FTC says AT&T didn’t do a good enough job at notifying these customers that service would be handicapped so severely, a process which saw upwards of 3.5 million AT&T customers being throttled more than 25 million times.

In an official statement, FTC Chairwoman Edith Ramirez made her position clear: you can’t promise unlimited data then later put a limit on speeds.

“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.”

While it’s totally fine for AT&T to introduce new “unlimited” data plans and change their terms and definitions today — they aren’t allowed to redefine their terms for those still under contract, especially without adequately notifying them first. This, the FTC alleges, is in direct violation of the FTC Act. Of course, the whole matter will be settled in court (U.S. District Court for the Northern District of California, San Francisco Division), so where it goes from here remains to be seen.


Chris Chavez
I've been obsessed with consumer technology for about as long as I can remember, be it video games, photography, or mobile devices. If you can plug it in, I have to own it. Preparing for the day when Android finally becomes self-aware and I get to welcome our new robot overlords.

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  1. Go FTC!

  2. I can’t believe it! I always wondered why this wasn’t some kind of tort, like intentional interference with a contract.

  3. Can we do this with T-Mobile too?

    1. T-Mobile tells you they will throttle you after however many gigs you have

      1. Yet they still call it unlimited.

        1. But T-Mo tells you upfront, x GB of high speed data, throttled (but unlimited) after that. AT&T doesn’t do that, they just say “unlimited data” and throttle when they feel like it.

  4. FTC FTW

  5. I had to get rid of my unlimited data because the speeds really were getting very slow.

    1. Same here, speeds were ridiculously slow and I was getting throttled at 2GB, I moved over to Verizon last year and now I’m paying for 20 gigs and getting 40 gigs in return. Couldn’t be happier

  6. About time.
    The definition of “Unlimited” is without any limits or restrictions, not limited in number or amount, not bounded by exceptions.

    Throttling your data speed….is no different than driving and coming upon a road sign that tells you to reduce your speed…’s called a speed limit
    Wireless companies can’t redefine the word “limit” to suit their financial needs.
    That type of advertising is illegal…..again….FTC, about f-ing time

    1. I was having an argument with my friend who works for a phone company, he is under the belief that if a carrier says you have unlimited data that the absolute total limit of “unlimited” should be 1TB… I suppose Cricket and a few other companies will terminate your service completely should you reach that mark in one billing cycle. After 30 minutes of me asking him to explain how 1TB is anything but “limited” and going nowhere we dropped the argument, but I still think I had the correct point. If you supposedly have unlimited internet, and your carrier goes so far as to CANCEL your contract just because you used a TB of data, how is that anything but misleading? Ah well.

  7. A the end of the day, who cares? AT&T will reach some pathetically low agreement with the FTC. Meanwhile every single customer wont see a dime. And the entire routine will be done all over again in a couple of years with something else

  8. Yeap, AT$Thieves are fun of that.

  9. I am grandfathered in on the Unlimited plan, and of wasn’t an issue until August of this year. Couldn’t believe how slow data got after 5GB. Called AT&T to figure out what was going on, and this is how I learned of throttling. Now I have to monitor my usage. Not so unlimited.

  10. This will go nowhere. The agreement you sign says plainly that you are agreeing to let them do this. It’s up to the consumer to read what they are signing. AT&T also informs customers via text or email, sometimes both, before being throttled and then at the moment throttling begins. They are providing an unlimited amount of data, as agreed, but stipulate the speeds you get. You do not get overage charges and can use as much as you want, even if it isn’t fast. I received the messages many times in the past as I routinely used 8Gigs a month. I’m not going to say it’s fair, but we all agreed to it even if we didn’t bother reading what we signed. With that and a fairly reliable notification system of alerts about it, AT&T probably won’t lose or won’t lose enough for it to matter anyway. Look one the bright side, they let you keep your unlimited even if you resign your contract. Verizon makes you switch away if you resign.

    1. No, it wasn’t in the agreement… that’s exactly why the FTC is doing this.

      1. It sure is. In the section that states they can make any changes at any time with no prior consent. Remember when the price of insurance increased a couple of years back? It went from $4.99 to $6.99. It changed company wide even for customers that already had it. No grandfather pricing.

        1. “Changes without prior consent” clauses do not give companies the right to change the meaning of words like “unlimited.”

          1. You are allotted an unlimited amount of usage, but not free access to the network. The provider dictates what speeds are given. I’m not saying it’s what I want them to do, I’ve been throttled before and hated it, but as it stands, they are not violating any laws.

          2. “they are not violating any laws”

            The FTC seems to think otherwise.

          3. There’s no law saying they can’t slow the speeds down. They aren’t the only company to throttle either. I’m not saying it’s a good thing. I didn’t like it being done to me, but the FTC will need to change the laws for how networks are governed before this case will truly have a good chance.
            It’s consumers fault for not reading their contracts and any messages they are sent from their carrier. At least that is what it will boil down to. Nothing will be done or so little, that it might as well of been nothing.

          4. Misleading consumers and bait-and-switch tactics are illegal. If they had advertised their unlimited data as unlimited, but we will throttle whenever we want, that would be fine. But they advertised unlimited data without coveats, then proceded to add coveats, and did so without spelling out those coveats. That’s both misleading and bait-and-switch.

          5. They did make changes, but not only did they notify every customer of said changes via a notice in their bills, they also released a press statement and it was all over the news at the time. I remember the change over very well as I was immediately effected. They made it very clear when and why I would be throttled. When the made the change, they had no longer offered unlimited data to knew customers for at least a year. There was no advertising the plan as one thing and giving another as it technically didn’t exist anymore. They also did away with all unlimited aircard plans at the same time and did not allow customers to keep them at all. All aircard plans were automatically changed, but the customers were notified of said change. It’s within their right as the carrier as laid out by the terms and conditions of the agreed upon contract. It’s unfair in the sense that the contract heavily favours them, but most contracts favour the business over the consumer

  11. Wow, that’s awesome. I really wish they’d do this ALL THE TIME, and keep the carriers on their toes a little bit.

    Does anyone know at what point T-Mobile starts throttling? Just curious because when I talked to an agent a couple days ago (about an unrelated issue but I brought it up) she claimed since I have the unlimited plan, I don’t get throttled and “unlimited means unlimited”… I told her I knew that was very unlikely the case, and that I wouldn’t get upset, I just wanted to know. Still, she wouldn’t tell me. But I’ve been without WiFi for a few months, and just a few days my internet slowed to a crawl, and I’m only at 52GB for the cycle (98% of which is Netflix, Google Play Music, and Google Movies & TV) … so if someone knows and lets me know I’d be grateful.

    1. I’m at 163 gigs thus far this month, and I’m still pulling 42 mbps down… Seems pretty unlimited to me.

      Edit: IIRC they now throttle if you’re using torrents or p2p file sharing. I use a VPN when I do these things, so that may be why I have evaded a throttle.

      1. And you sir are the reason why they throttle data…

        1. Why do people think this way? Are people just uneducated about how TCP/IP works? Do people really believe that “the top 5%” are bogging down the network?

          These beliefs are totally false and the carriers should be penalized spreading false information? The truth is, the networks backbone is not the bottleneck, its the limited frequency spectrum (in other words an overcrowded tower). Absolutely NOT from high bandwidth usage!

          1. If they didn’t throttle data do you think there would be only 5% using over 100 gb of data a month?

          2. Yes! Most of us do are heavy downloading at home on our cable/dsl/fibre connections. Wireless data isn’t intended for that kind of downloading. uniquename72 is exactly right, it’s people like you that give the carriers an excuse to throttle the rest of us.

          3. No one believes the networks are bogged down. But it’s jackholes like this who give telcos the ammunition and the excuse to throttle normal people who are only using 5-10GB per month.

            If you’re too poor to have cable internet and so need to use your phone for torrenting, your priorities are seriously effed. AT&T and this guy can both go die and make the world a better place.

          4. “its the limited frequency spectrum (in other words an overcrowded tower)”

            And you guys are contributing more than your share of that overcrowding.

        2. for using the data he pays for?

    2. “Does anyone know at what point T-Mobile starts throttling?”

      Either at the point noted by your data plan (1GB/3GB/5GB) or when they catch you with open ports (P2P, Webcam server, etc.) on the Unlimited plan.

      If you’re seeing a slowdown, it could be the tower is under maintenance or overloaded.

  12. Can we petition to have Sprint fined until they bring Spark to their entire network?

    1. sorry but sprint is not tying to throttle you, they just slow.

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