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FCC Chairman Claims Verizon’s “Network Optimization” Policy is “Disturbing”

August 1, 2014 - Written By Alexander Maxham

So last week, Verizon came out and stated that they are going to begin throttling unlimited data customers that go over 4.7GB for up to two billing cycles. This begins October 1st. But the FCC has taken action against Verizon in this. Because they are only targeting unlimited data users, and not those tiered data users that are using 5+ GB of data per month. Verizon states that this part of their “network optimization” policy, which has been in effect for a few years, but only really applied to their 3G network. However now that’s changing to affect their 4G LTE network. Which is why it’s getting a lot of attention now.

The FCC Chairman, Tom Wheeler, sent a letter earlier this week over to Verizon’s CEO Dan Mead. Which wasn’t a very nice letter, in fact it was pretty nasty.

“‘Reasonable network management’ concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams,” Wheeler wrote in his letter to Mead dated Wednesday. “It is disturbing to me that Verizon Wireless would base its ‘network management’ on distinctions among its customers’ data plans, rather than on network architecture or technology.”

Wheeler also noted in his letter, that the FCC defins a network management practice to be reasonable if and only if “it is appropriate and tailored to achieving a legitimate network management purpose, taking into account the particular network architecture and technology of the broadband Internet access service.” Now we don’t have any proof that Verizon is doing this to increase revenue streams, but one has to wonder if this is really why they are throttling unlimited data users, especially when it’s only unlimited data users that are outside of their contract. 

Verizon fired back at Wheeler and the FCC:

“We will officially respond to the Chairman’s letter once we have received and reviewed it,” Verizon said in a statement on Thursday. “However, what we announced last week was a highly targeted and very limited network optimization effort, only targeting cell sites experiencing high demand. The purpose is to ensure there is capacity for everyone in those limited circumstances, and that high users don’t limit capacity for others.”

Verizon stated during their earnings earlier this week, that about 50% of their users are on the More Everything plans, which leaves a pretty big chunk of people on Unlimited plans still. And it looks like they are looking to push all of them onto tiered plans for two reasons. Limit their bandwidth to make the network better, and two, to make more money.

We’re still waiting word from Verizon on this issue and as soon as we learn something from them, we will be sure to let you know.