On Tuesday, officials with the Federal Trade Commission (FTC) sued AT&T, America’s second largest cellular provider, for allegedly misleading customers by selling them “unlimited” data plans that were then “throttled” by the company by slowing internet speeds of customers who consumed an excess of data past a certain point.
The FTC claims AT&T has used this practice since 2011 and estimates that it has affected over 3.5 million customers on at least 25 million occasions.
Customers experienced these data slow downs an average of 12 days a month and in some cases internet speeds were cut up to 90%. The FTC reportedly received thousands of complaints about the practice.
FTC Chairwoman Edith Ramirez stated, “AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise. The issue here is simple: ‘unlimited’ means unlimited.”
According to the FTC’s complaint, AT&T emphasized the unlimited amount of data available to consumers who signed up for their unlimited plans. When these unlimited plan consumers renewed their contracts the company failed to inform them of the throttling program. Customers who later attempted to cancel their contracts after experiencing the throttling were charged early termination fees, often amounting to several hundred dollars.