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| T-Mobile |
T-Mobile USA failed to adequately disclose speed and data restrictions on its "unlimited data" plans and has agreed to pay a fine and provide some benefits to customers, the Federal Communications Commission said today.
Like other carriers, T-Mobile slows the speeds of its unlimited data
customers after they've used a certain amount of data each month; when
these customers connect to congested cell towers, they receive lower
speeds than customers without unlimited data plans. The throttling is
applied after customers use 26GB in a month.
"Under its 'Top 3 Percent Policy,' T-Mobile 'de-prioritizes' its
'heavy' data users during times of network contention or congestion,"
the FCC said in an announcement
today. "This potentially deprived these users of the advertised speeds
of their data plan. According to consumers, this policy rendered data
services 'unusable' for many hours each day and substantially limited
their access to data."
T-Mobile signed a consent decree
in which it agreed to pay a $7.5 million fine to the US Treasury and
provide some discounts and extra data for T-Mobile and MetroPCS
customers. (MetroPCS is a T-Mobile subsidiary.)
From now on, T-Mobile will also have to provide clear and conspicuous
disclosures about the speed and data limits of its unlimited data plans
in all sale, advertising, and marketing materials. Alternatively,
T-Mobile can comply by removing the word "unlimited" from the plans, or
by no longer throttling unlimited data users. It seems likely that
T-Mobile will take the first option of improving its disclosures—the FCC
noted that T-Mobile already improved the disclosures a bit in June
2015.
The FCC alleged violations of the commission's Open Internet
transparency rules, saying that "T-Mobile’s public disclosures about the
de-prioritization policy prior to June 2015 were not sufficient to
fully inform consumers about limitations imposed on the UDPs [unlimited
data plans], because they did not identify the data usage threshold that
would trigger application of the policy, did not explain how the policy
could impact a de-prioritized customer’s ability to use their service,
or discuss the data throughput speed reduction a de-prioritized customer
could experience."
“Throttling”
For a couple of years, T-Mobile spokespeople have repeatedly asked
Ars to stop using the word "throttling" to describe the company's
practice of slowing certain customers' speeds, even though throttling is
a commonly used term
for speed reductions imposed by Internet service providers. In one
e-mail earlier this month, a T-Mobile spokesperson insisted that our latest article's
"use of the term 'throttling' in incorrect... This is prioritization,
which every network operator does." T-Mobile also asked us to delete the
"Dead Slow" image at the beginning of that previous article.
But as the FCC's order says, T-Mobile itself has abandoned its
insistence that this is only "prioritization" in disclosures to
consumers. Before June 2015, T-Mobile merely told consumers that their
data speeds might be de-prioritized below those of other customers. The
updated disclosures in June 2015 "state that affected customers 'will
likely see significant reductions in data speeds, especially if they are
engaged in data-intensive activities,'" the FCC said.
The new disclosures also tell unlimited data customers the actual
amount of data they can use before being throttled, whereas previously
T-Mobile merely said that the slowdowns "would be triggered when
the customer used 'more data than what 97% of other customers use' based
on historical use," the FCC said.
The FCC received hundreds of complaints from T-Mobile and MetroPCS
customers. "These customers complained that they were not receiving
'unlimited' data as had been sold to them, that their data throughput
speeds after de-prioritization caused their data service to be
'unusable' for many hours each day, that the de-prioritization policy
led to them consuming 'half' of the data they wanted to use, or that
they had gone to too much trouble changing plans from another carrier to
switch again, even though they felt misled by T-Mobile," the FCC said.
"In April 2015, a T-Mobile UDP customer complained of feeling 'stuck'
with T-Mobile because they were still on a payment plan for their
T-Mobile phone, despite 'paying $300 a month' for 4 lines of 'unlimited
data,' yet feeling that T-Mobile wasn’t providing the service it
advertised. One de-prioritized customer stated that the applications he
likes to use to watch movies 'are now unusable' due to the slow speeds
he experiences after being de-prioritized."
The consumer benefit program that T-Mobile agreed to will
provide discounts of up to 20 percent or $20 off any in-stock accessory,
and an additional 4GB of data. That isn't 4GB every month, however—it's
just a one-time addition of 4GB, and it is only for unlimited data
subscribers who also purchase data for another device such as a tablet.
(The 4GB can be rolled over for customers in the T-Mobile "Data Stash"
program, so it wouldn't have to be used the first month.) T-Mobile will
notify eligible customers by December 15, and consumers can get more
information at the T-Mobile and MetroPCS websites.
The benefits in this program are expected to total up to $35.5 million.
T-Mobile will also spend at least $5 million in low-income school
districts to give students free devices such as tablets and free mobile
broadband. If the consumer benefit program we previously mentioned ends
up providing less than $35.5 million worth of benefits, T-Mobile will
take the difference and add it to the low-income school program. The
school program is expected to start in October 2017 and help up to
80,000 students over four years.
The FCC has also been trying to punish AT&T for misleading customers about unlimited data plans. The FCC proposed a $100 million fine in June 2015, but AT&T challenged the decision.
AT&T and the FCC could come to some agreement similar to the one
announced today with T-Mobile, or the FCC could issue a final ruling
requiring AT&T to pay a fine. But if it comes to that, AT&T
could try to reverse the penalty by taking it to the US Court of
Appeals.
Source:Jon Brodkin
