The FCC is currently planning to launch a multi-million dollar fine against AT&T for misleading customers about the performance of its unlimited data plans. In response, AT&T announced changes to its data plans, increasing the data cap, a move that AT&T is likely making to try to avoid the pending fine from the FCC, however.
Under AT&T's unlimited mobile data plans, users are given unlimited data, but the speed at which that data is accessed varies. Initially, users are given Internet access via a high-speed connection such as 3G or 4G, as specified in the plan. After the users cross a data threshold, AT&T drastically reduces the speed that users access the Internet, which limits the extent to which they could use the service. Although customers could indefinitely use the Internet, they could only do so at speeds comparable to a dial-up connection.
This has been a frequently used tactic by many mobile ISPs over the last several years. AT&T began doing this in 2011 with its "Maximum Bit Rate" policy, but the FCC is now leveraging fines against these companies for engaging in the practice. The $100 million dollar fine the FCC plans to place on AT&T is for inadequately notifying its customers that the speed of their Internet connection would be reduced after they crossed a certain data threshold, delivering performance lower than AT&T advertised.
A major reason why AT&T is being charged with this now is likely because of a change in FCC leadership. FCC Chairman, Tom Wheeler, took control of the FCC only in November 2013. Since that time, he has been extremely active in attempts to reform the Internet in the United States with his Open Internet regulations.
"Consumers deserve to get what they pay for," said Wheeler. "Broadband providers must be upfront 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."
Possibly in response to this pending fine, AT&T announced (opens in new tab) that it would be increasing its data cap on unlimited mobile plans. The new data cap is set at 22 GB, which may be more than enough for some users, but a few will still end up hitting that amount and have to deal with throttling the rest of the month. When users don't hit 22 GB, however, it would give the impression of having unlimited data at the full network speed.
Although this might help get AT&T out of trouble, there is still a strong possibility that the FCC will fine the company anyway, because the fine is not for the existence of the data cap or how low the cap is set, but for not clearly informing customers about its existence. Although the data cap currently isn't the issue the FCC is looking at, it might be in the future.
"Unlimited means unlimited," said FCC Enforcement Bureau Chief Travis LeBlanc. "As today's action demonstrates, the Commission is committed to holding accountable those broadband providers who fail to be fully transparent about data limits."
This statement by LeBlanc could point to a change in the FCC's stance on data caps as a whole. If so, we will likely see many more fines launched against companies in the near future.