Federal Trade Commission Sues AT&T For Limiting Data Speed

Another reason we need real net neutrality:

Federal officials on Tuesday sued AT&T, the nation’s second-largest cellular carrier, for allegedly deceiving millions of customers by selling them supposedly “unlimited” data plans that the company later “throttled” by slowing Internet speeds when customers surfed the Web too much.

The Federal Trade Commission said the practice, used by AT&T since 2011, resulted in slower speeds for customers on at least 25 million occasions – in some cases cutting user Internet speeds by 90 percent, to the point where they resembled dial-up services of old. The 3.5 million affected customers experienced these slowdowns an average of 12 days each month, said the FTC, which received thousands of complaints about the practice.

What does that mean? It means that if you used too much date in your "unlimited" data plan, AT&T will deliberately slow your speed down to a crawl.

I'm going to go out on a limb here and say this is why President Obama is different from Republicans. He appointed the current head of the FTC Edith Ramirez. And I'll bet there are some Senators who are regretting that vote, too.

And it seems that Ramirez isn't afraid to go where the FCC is afraid to tread:

In challenging one of the nation’s largest cellular providers, she also tread close to the jurisdiction of a sister agency, the Federal Communications Commission, which more regularly handles telecommunications issues but often has been criticized by consumer groups as being too cozy with industry and not aggressive enough in protecting customers’ privacy and pocketbooks.

“AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” said Ramirez in a statement. “The issue here is simple: ‘unlimited’ means unlimited.”

Exactly right. "Unlimited" means Unlimited. And the FTC, in its investigation, found regular and systematic throttling of data in AT&T's "unlimited data" plans.  The suit, which was approved unanimously, is seeking a monetary judgement to be paid out to affected customers.

The FTC is using its powers to go after companies that engage in "deceptive marketing practices".

Naturally, AT&T, the 14th largest spender when it comes to lobbying, called out the WAAAAAAAAmbulance:

AT&T responded by calling the FTC’s allegations “baseless” and an intrusion into the normal network management practiced by all telecommunications providers. The company also noted that it had alerted customers about the throttling, by sending e-mails or texts notifying customers that they had crossed pre-set limits and would experience slower data speeds for the rest of the billing period.

“It’s baffling as to why the FTC would choose to take this action against a company that, like all major wireless providers, manages its network resources to provide the best possible service to all customers,” said AT&T senior executive vice president Wayne Watts, “and does it in a way that is fully transparent and consistent with the law and our contracts.”

"Poor little us, we sent those people a text".

Yeah, but your plans should say straight up "We'll slow your ass down if you use what we think is too much data"

In the meantime, the FTC has collected loads of stories from customers, and AT&T itself, in a "data-lite" period, slowed people down so much that they received 190,000 complaints.

But, you ask, shouldn't the FCC also be in on this as well?

Well, that's where things get a bit sticky:

The fight also touches on some larger issues, including the politically charged debate over “net neutrality,” which concerns whether Internet providers should be allowed to alter the speeds of various Internet traffic, potentially prioritizing the data flowing from favored corporate partners. Both of the Republican commissioners on the FTC, Maureen Ohlhausen and Joshua Wright, issued tweets on Tuesday afternoon saying that the AT&T lawsuit showed that the FTC already has the power to regulate certain abuses in Internet data flows.

“@ATT throttling case shows the @FTC can and will enforce broadband ISPs’ promises about traffic mgt. #NetNeutrality http:,” Ohlhausen said in her tweet.

Such arguments come amid larger turf issues between the FCC and the FTC, which regulates a broader group of industries and often is described as more aggressive in curbing the abuses of large companies.

“Under Ramirez, the commission is going to confront some of the most powerful companies in the country for their data and privacy practices,” said Jeff Chester, executive director of the Center for Digital Democracy, a consumer and privacy group based in Washington. “This is part of a much broader set of investigations going on at the FTC to look at how the digital data marketplace treats consumers… The FTC is stepping into an area where the FCC has failed to be an effective regulator.”

This is a case to watch, should it make it to trial. Should the FTC lose, it will give telecom companies free license to throttle data all they like. A license that will only be stopped when we get true net neutrality and a free and open internet for all at the highest speeds.