FTC fines TracFone $40 million for throttling their so called ‘unlimited’ data


TracFone StraightTalk

Take past any carrier store and you’ll see posters or banners advertising xGB of “unlimited data.” For those up to speed on tech, you know this means you get X amount of high-speed data, only to have your internet speeds slowed down (throttled) after that.

It’s not a bad idea, and much better than data caps of yesteryear where you’d be charged extra for any data you consumed above your cap. But, when it comes to a carrier advertising “unlimited data,” the FTC is now stepping in, saying unlimited data doesn’t include throttling… unless fully disclosed, of course.

The Federal Trade Commission ordered mobile virtual network operator TracFone to pay up $40 million for falsely advertising unlimited data, only to throttle customers once they reached a certain amount and in some cases, cut off data services completely. FTC Bureau of Consumer Protection director Jessica Rich said in a statement to Re/code:

“This case is about false advertising. It’s not about throttling. We’re not challenging throttling in and of itself. The issue here is simple: When you promise consumers ‘unlimited,’ that means unlimited.”

Let’s be clear. The FTC’s issue with TracFone wasn’t that they were throttling their customers, it’s that they failed to advertise their data cap in the same way carriers like T-Mobile do. Even worse was throttling wasn’t a tool to manage network traffic which would be fine, but a way to cut the costs TracFone was incurring for operating on other carriers’ networks.

For years, customers under TracFone and Walmart’s Straight Talk brand had no clue when their “unlimited data” would be throttled, leading to a lot of guess work and countless forum posts. Couple this with the way Straight Talk would completely cut off you service without warning if you used too much data. Yeah. Not exactly unlimited, was it? Eventually, they finally came clean.

While the “Big Four” carriers in the US are safe for now, they are seemingly put on notice. It was only back in October that the FTC announced that they were suing AT&T for throttling grandfathered customers still on their unlimited plan.

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.

Samsung Gear VR arrives at Best Buy for $200 with in-store pickup option

Previous article

With little competition, Facebook officially pulled in $12 billion last year

Next article

You may also like


  1. they should charge all carries. not nice.

    1. *Carriers…and yeah I agree. I think AT&T is about to be fined…..I read something a couple of weeks ago about the FCC announcing it.

      1. ATT’s fine would in billions

        1. I wonder if there is a cap for how much they can be fined for that?? hmm we shall see. Just google’d it and found a bunch of articles from 01/09/2015

  2. Good. ‘Unlimited’ should mean ‘unlimited’, including the spirit of the term ‘unlimited’ (i.e., statements like “they said unlimited data, not unlimited speed!!!1” should not be valid unless explicitly stated).

  3. Why are they getting fined, the money should go to the customers, not the feds

    1. Quote from the original article. “All the carriers are on notice, though, that slowing down customers on unlimited plans could land them in hot water. In the TracFone case, customers who purchased such plans and saw their speeds slowed are now eligible for refunds.”

  4. GOOD! I was with Straight Talk for a bit, and they took away my data because they said their unlimited data didn’t include video streaming, aka, no YouTube with them. Our relationship didn’t last very long.

    1. Same here with Straight Talk. They cut my data for a month and a half for a single 5min low res youtube video so I said NOPE and went back to Boost Mobile where I can stream all the Music and videos I want.

      1. The data plan doesn’t include streaming videos?!?? No Netflix??

  5. For $5 more than straight talk charges I get unlimited lte data on metropcs.

  6. For some reason my girlfriend loves them so I gave her my s4 and got her a straight talk sim to get her on a smartphone, that’s where I saw their true bs. When I set it up they would not transfer her number between devices. Their excuse was her old phone operated on verizons network and the sim works on AT&T so they can’t switch it.

    1. Yea not porting a number is illegal, unless she owed money to Verizon still, or had already cancelled Verizon and lost #. If you report them I believe they get some sort of fine.

      1. It was straight talk to straight talk they said they can’t switch because the two devices use different carriers networks

        1. This is a 100% legit reason. One is gsm the other cdma. Won’t work.

          1. Phone numbers are not locked to a network

          2. Yeah they should be able to port the number, but I’ve dealt with a number of tracfone owned mvno’s and their support reps are beyond horrible and usually have no clue what they are talking about.

          3. Oh Ohkay sorry I read your original post incorrectly. Thought you were saying you were trying to activate the old Verizon phone on the AT&T network. Oops.

    2. Buy a GSM SIM when the month is out and then reactivate it. Or ask them to swap it out in that way. Sometimes support people have blinders on and don’t realize there is a shortcut or another way to get there. ;) It truly is a pain in the ass and that sucks for you.

    3. Cricket costs less, and gives you more.

  7. i don’t know how tracfone went so long doing this with out getting in trouble? they been stealing from people for a long time now!

Leave a reply

Your email address will not be published. Required fields are marked *

More in News