The FCC's rules of the open Internet have been in effect for less than a week, but the FCC wants ISPs to know it isn't playing around. On Friday, the FCC kicked things off by fining Verizon and Sprint a combined total of $158 million for illegal billing practices, and today the FCC launched a fine against AT&T for $100 million over misleading consumers.
The reason for this fine is focused on the inaccurate use of the term "unlimited" when advertising data plans, and for failing to disclose the actual Internet speeds that customers on "unlimited" data plans receive after hitting a specified data threshold.
Under AT&T's unlimited data plans, AT&T applies a policy, known as the Maximum Bit Rate (MBR) policy, to 4G LTE customers after they reach 5 GB of data usage in a billing cycle. This policy is applied to 3G and other 4G customers also, but after hitting 3 GB of data within a billing cycle instead of 5 GB. The FCC stated that the typical bandwidth for 4G LTE service ranges from 5 Mbps to 12 Mbps in most markets, but after hitting the data threshold, AT&T limited customers to a maximum of 512 kbps regardless of network congestion.
Currently, AT&T does not list at what point data is capped, nor does it list what the Internet speed is reduced to after it reaches that point. Thus, customers are tricked into buying what they believe to be an unlimited 4G LTE data plan, but they do not receive unlimited service at 4G LTE speeds. Because this deceives customers and prevents them from making a truly informed decision, the FCC levied the $100 million fine.
The previously mentioned fines the FCC handed to Verizon and Sprint were accepted by the two companies and will be paid, but currently, AT&T has not taken any action and may choose to fight the FCC instead. Regardless of the outcome, everyone who uses the Internet should take joy in the FCC working so hard to enforce the recent Internet legislation and rules of the Open Internet.
ISPs have taken advantage of users in numerous incidents. Whether it's secret charges placed on your bill (as with Verizon and Sprint), or receiving service below what the company advertised (as with AT&T), or having your personal information sold off by your ISP, the FCC's work to protect Internet users means that we are no longer at the mercy of ISPs with unlimited and unquestioned power.
"Today we act on behalf of consumers misled by promise of unlimited data. Consumers should get what they pay for," said FCC Chairman Tom Wheeler on Twitter. "ISPs must be upfront about services they provide. We intend to enforce FCC's Transparency Rule for consumers."
Unless the FCC's latest legislation is repelled in the courts, we should expect to see more fines and more changes that benefit and protect Internet users in the near future. For now, let us sit back and say thanks to the FCC for making the Internet a safer place for us all.