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AT&T hit with a major lawsuit for throttling its ‘unlimited’ data users [updated]

Updated Oct 28th, 2014 1:49PM EDT
AT&T FTC Unlimited Data Lawsuit

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The Federal Trade Commission just brought down the hammer on AT&T for allegedly misleading “millions” of smartphone users with promises of unlimited data plans. In a complaint filed in a federal court on Tuesday, the FTC alleged that AT&T has been misleading its own subscribers “by charging them for ‘unlimited’ data plans while reducing their data speeds, in some cases by nearly 90 percent.”

RELATED: Wireless data caps are a massive crock, and the carriers know it

Specifically, the FTC is alleging that AT&T didn’t do enough in its marketing to inform customers that their “unlimited” plans would get throttled down to lower speeds if they exceeded a certain limit. The carrier should have done more to let consumers know that unlimited data simply means that you won’t face overage fees for exceeding a set data limit, not that you get unlimited 4G LTE data to use every month.

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

We’ve reached out to AT&T for comment and will update this post when we get a response. The read the FTC’s full press release on its complaint, click the source link below.

UPDATE: AT&T is hitting back hard against the FTC’s allegations and is calling its complaint “baseless.”

“The FTC’s allegations are baseless and have nothing to do with the substance of our network management program,” the company says. “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, and does it in a way that is fully transparent and consistent with the law and our contracts.

 “We have been completely transparent with customers since the very beginning. We informed all unlimited data-plan customers via bill notices and a national press release that resulted in nearly 2,000 news stories, well before the program was implemented.  In addition, this program has affected only about 3% of our customers, and before any customer is affected, they are also notified by text message.”

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.