The FCC fined AT&T $100 million dollars after it was found that AT&T misled customers regarding the details of its “unlimited” data plans.
The FCC received thousands of complaints from AT&T customers about the specifics of these unlimited data plans. AT&T began implementing different policies in 2011 that allowed for the company to slow down data speeds after customers reached a certain amount of data usage. Whenever a customer exceeded 5 GB of data usage, their data speeds were “throttled” down, sometimes making it almost impossible to use apps and Internet browsers. The FCC believes that AT&T was not completely transparent in its marketing of the unlimited data plan.
The FCC stands firmly behind its decision to hold these large broadband providers accountable for their actions. While AT&T did provide customers with a notice that data policies would be changing, the FCC does not believe the notice provided enough transparency to uphold the transparency requirements that are stated in the Open Internet Order. The Open Internet Order is a group of regulations that the FCC enforces that obligate broadband providers to maintain accurate and transparent communications with their customers about the nature of their Internet and data plans. The $100 million fine is the largest that the FCC has ever issued.
AT&T Believes They Are Innocent
Many broadband providers have begun implementing the practice of slowing down data usage for heavy users. The FCC approved this practice and defines it as legal. AT&T plans to dispute the fine rigorously. The broadband provider believes that it acted within FCC regulations in the way in which it informed customers to changes in the unlimited data plans. AT&T did post a note to its website in 2011 about the changes to the unlimited data plans and attempted to inform customers in a number of different ways.
The FCC does not take these types of cases lightly. With broadband Internet playing a more important role in the lives of people than ever before, the FCC believes that holding broadband providers to their words is incredibly important.
“Broadband providers must be upfront and transparent about the services they provide. The FCC will not stand idly by while consumers are deceived by misleading marketing materials and insufficient disclosure,” said FCC Chairmen Tom Wheeler.
While the FCC has charged AT&T with this fine, it is not conclusive yet as to whether or not AT&T will actually be forced to pay it. They have 30 days to come up with a response. In the past, many fines doled out by the FCC have been settled outside of court. AT&T has faced many fees larger than the most recent one handed out by the FCC. The American broadband provider has made billions of dollars from its unlimited data plans, and this fine will not do much to harm the company. The FCC has stated that if AT&T continues to carry practices similar to this, the next fine will not be so minor and will likely impact AT&T in a significant way.
AT&T also faces a lawsuit from the Federal Trade Commission. Lawsuits like this will continue to pop up as the future of the Internet evolves. This issue is part of larger debate that is being called “Net Neutrality.” This idea states that Internet service providers should not discriminate pricing based on the type of Internet being accessed or the amount. It’s a debate that has been raging on since the beginning of the Internet and one that will likely continue for many years to come.