Five years in and $60 million later—not counting legal fees—AT&T has settled a complaint brought by the Federal Trade Commission over the mobile carrier’s so-called unlimited data plans.
The FTC had accused AT&T of “[misleading] millions of its smartphone customers by charging them for ‘unlimited’ data plans while reducing their data speeds, in some cases by nearly 90 percent.” The agency wrote in a colorful press release in October 2014 that the wireless company didn’t make it clear enough to consumers that the unlimited plans came with, well, very real limits.
“If they reach a certain amount of data use in a given billing cycle, AT&T reduces—or “throttles”—their data speeds to the point that many common mobile phone applications – like web browsing, GPS navigation and watching streaming video—become difficult or nearly impossible to use,” the FTC quaintly alleged.
The No. 2 carrier acknowledged the settlement in a comment published by Reuters. “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,” AT&T said.
The settlement requires AT&T to fork over $60 million to partially refund customers who paid for unlimited plans before 2011, according to Reuters. It will also force AT&T to clearly disclose the limits it imposes on unlimited data plans.
“The disclosures need to be prominent, not buried in fine print or hidden behind hyperlinks,” the FTC said.