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AT&T Updates Policy Regarding the Throttling of Unlimited Data Plans

May 6, 2015 - Written By Lucius Bossio

Although AT&T hasn’t offered an unlimited data plan for four years, many users have continued to hang onto their unlimited data plans despite AT&T’s efforts to dismay them via aggressive throttling. Throttling, or cutting the speed of a user’s data connection, is common practice amongst the four largest US carriers: T-Mobile, Sprint, Verizon, and AT&T. However, AT&T’s throttling has garnered the most attention from consumers, as well as the FTC and FCC, because the company’s throttling has absolutely no relation to network traffic or congestion; they drastically reduce data speeds across the board once customers reach a threshold of 3GB or 5GB (depending on the plan). In some cases users reported their data speed was throttled by up to 95%, practically rendering their data plan useless, which prompted the Federal Trade Commission (FTC) to file a lawsuit against AT&T late last year.

The FTC’s lawsuit is based on allegations that AT&T has misled customers on unlimited data plans and is using aggressive throttling to encourage these customers to abandon their plan in favor of modern, and more expensive, data packages that are not affected by throttling. AT&T has fought the FTC tooth-and-nail and even filed a motion to have the lawsuit dismissed in January, as AT&T believes they are not subject to the FTC’s oversight because they are a common carrier. The filing was dismissed by a federal judge at the beginning of April, who upheld the FTC’s right to sue AT&T because the FTC Act only exempts AT&T from the regulation of their landline telephone and mobile voice services, not their mobile data services.

The threat of action by the Federal Communications Commission (FCC) also looms over AT&T, as the practice of throttling data was banned by the FCC’s net neutrality rules that were put into effect on March 12, 2015. Although AT&T is technically violating these new rules the FCC has stated that consumers would have to file a formal grievance against AT&T and that these grievances would be handled on a case-by-case basis. All things considered, AT&T is not on good terms with both the public and the federal government these days.

Perhaps all the bad press and legal issues that have surrounded AT&T over the past 6 months have finally had their desired effect as they recently updated their policy regarding the throttling of unlimited data users. Prior to today, the policy for unlimited data users with 4G LTE smartphones stated: customers on a 4G LTE smartphone will experience reduced speeds once their billing cycle exceeds 5 gigabytes of data. Today the same policy reads: customers on a 3G or 4G or on a 4G LTE smartphone with unlimited data plan who have exceeded 3 gigabytes (3G/4G) or 5 gigabytes (4G LTE) of data in a billing period may experience reduced speeds when using data services at times and in areas that are experiencing network congestion. In other words, data throttling occurs only when users pass a certain threshold and are accessing a cell tower that is experiencing a high degree of network congestion, which is the way throttling is supposed to work. It appears that complaints by consumers, the media, and federal government has actually influenced a lumbering behemoth of a company to modify their behavior in a way that benefits consumers at the expense of profit. Although, this policy change would certainly be much more encouraging if it happened before the federal government got involved, it is better late than never.