FCC to Fine AT&T $100 Million for Lying to Customers About Data Plans
NEWS ANALYSIS: The FCC said AT&T violated the Transparency Rule when it dramatically reduced data bandwidth to customers who thought they were paying for unlimited service.The Federal Communications Commission is planning to whack wireless leader AT&T with the largest fine the Commission has ever levied, some $100 million, a senior FCC official stated in media briefing on June 17. The proposed fine, outlined in a Notice of Apparent Liability, is for alleged violations of the FCC's Transparency Rule. The FCC is asserting that the company violated that rule when it limited the wireless speeds of users paying for unlimited data plans to a very slow 512KB per second once that user had used 5GB of data in a billing period. For its part, AT&T disagrees with the FCC. "We will vigorously dispute the FCC’s assertions," AT&T spokesperson Jim Greer told eWEEK in an email. "The FCC has specifically identified this practice as a legitimate and reasonable way to manage network resources for the benefit of all customers, and has known for years that all of the major carriers use it. We have been fully transparent with our customers, providing notice in multiple ways and going well beyond the FCC's disclosure requirements."
In its presentation to the FCC, the company said that the FCC had specifically allowed what it calls its Maximum Bit Rate Program as a way to handle network congestion. The FCC doesn't dispute that, but it asserts that it isn't fining AT&T for this practice, it's penalizing AT&T for the lack of notice to customers and the fact that by calling it's plan unlimited, they misled customers when they placed limits on it.