AT&T settles US$60 million case with FTC over false 'unlimited data' claims
The US Federal Trade Commission (FTC) made the announcement on Wednesday, adding that although the company advertised to clients that they would be able to use an unlimited amount of data, once a customer passed a certain threshold, their downloading speeds would be significantly reduced.
The mobile carrier was also restricted from creating advertisements or otherwise claiming the amount or speed of the mobile data that will provided as part of a plan without also listing any possible limitations that may be placed on said plan.
Andrew Smith, director of the FTC's Bureau of Consumer Protection, said AT&T made promises it did not keep. "While it seems obvious, it bears repeating that Internet providers must tell people about any restrictions on the speed or amount of data promised," he said in a statement.
The restrictions come as part of a settlement for a case that AT&T had been fighting with the FTC since 2014. The telecom firm had argued that the agency had no jurisdiction in the matter but eventually lost the case in 2018.
During the case, the FTC claimed that AT&T slowed down data transfers for supposedly “unlimited” data plans after the customers used as only 2 GB of mobile data, an equivalent of watching about 2 hours of SD video or 20 minutes of high definition video.
"Even though it has been years since we applied this network management tool in the way described by the FTC, we believe this is in the best interests of consumers," said AT&T representatives in an emailed statement.
The settled $60 million will be placed into a repository and distributed to AT&T customers that may have been affected by the campaign in the form of partial refunds.