FTC sues AT&T for throttling data speed for 3.5 million costumers

FTC sues AT&T for throttling data speed for 3.5 million costumers

The Federal Trade Commission has sued AT&T over controversial data throttling for costumers on unlimited data plans. The telecom major reduced internet speed for ‘unlimited plan’ after they reached certain amount of data usage. The practice has been termed as deceptive by the Federal Trade Commission.

FTC Chairwoman Edith Ramirez said that unlimited should mean unlimited. The company wanted to retain customers and offered them unlimited plans, but when users consumed higher amount of data, the company reduced their speed. In certain case up to 90% reduction was seen by customers till the end of their billing cycle.

Ramirez said in a press release, “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 announced Tuesday that it has filed a formal complaint in federal court, against No. 2 telecom service provider in the country. FTC said that customers were not clearly informed about the stipulations they would face if their data usage exceeded a certain limit. As per FTC records, nearly 3.5 million customers faced data throttling.

AT&T has earlier said that the company has planned to reduce data speed in case customers seriously overuse their unlimited plans. The company claimed that the steps were taken to keep the network in good condition and to keeping in mind the speed needed by other customers using the network. AT&T has denied the current FTC charges and said that throttling was needed to manage network resources.
Research firm Nielsen has reported that an average customer uses 733 MB of data per month, as per records analyzed in year 2013.

Another telecom major Verizon had planned to throttle data speeds for high-usage customers. However, the company backed off from its plan after FCC Chairman Tom Wheeler criticized the company in July.

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