FCC Plans to Fine AT&T $100 Million Over Capping of Unlimited Plans

FCC says AT&T violated part of Open Internet rules by labeling plans as unlimited, throttling connections

The FCC said it has received thousands of complaints from customers with AT&T’s unlimited data plan who said they were surprised and misled by AT&T throttling their data speeds.

By Gautham Nagesh -- June 17, 2015 12:19 p.m. ET

wsj.com

WASHINGTON—The Federal Communications Commission plans to fine AT&T Inc. $100 million for allegedly deceiving consumers about unlimited wireless data plans, the agency said Wednesday.

The FCC alleges that AT&T sold consumers data plans advertised as unlimited, then capped data speeds for those customers after they used a set amount of data within a billing cycle. The FCC says those capped speeds were much slower than the normal network speeds advertised by AT&T, and that they impaired consumers’ ability to access the Internet or use applications for the rest of their billing cycle.

An AT&T spokesman said the company plans on “vigorously disputing the FCC’s assertions.” The spokesman said the FCC previously identified the practice as a legitimate and reasonable way to manage its network to benefit all customers.

The FCC says AT&T violated the transparency rule passed as part of its 2010 Open Internet rules by labeling the plans as unlimited. Most of those rules were struck down by a federal court last January, but the transparency rule was upheld.

“Consumers deserve to get what they pay for,” FCC Chairman Tom Wheeler said in a statement. “Broadband providers must be up front 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.”