FCC Fines AT&T $100 Million for Wireless Data Throttling Practices

Earlier today, the FCC proposed a record $100 million fine against AT&T Mobility (“AT&T”) for allegedly violating the Commission’s Open Internet Transparency Rule for marketing “Unlimited” wireless broadband data plans, but “throttling” consumers whose usage approached a pre-set amount of data. 
In the Notice of Apparent Liability for Forfeiture and Order (“NAL”), the FCC found that AT&T apparently willfully and repeatedly violated the Open Internet Transparency Rule by: (1) using the mis-leading and inaccurate term “unlimited” to label a data plan that was in fact subject to prolonged speed reductions after a customer used a set amount of data (a practice commonly referred to in the industry as “throttling”; and (2) failing to disclose the express speed reductions that it applied to “unlimited” data plan customers once they hit a specified data threshold.
Although AT&T asserted that it has provided ample disclosures about these policies, the FCC found that these disclosures did not cure AT&T’s apparent violations of the Open Internet Transparency Rule.  According to the NAL, AT&T’s practices deprived consumers of sufficient information to make informed choices about their broadband service and thereby impeded competition in the marketplace for such services.  Consistent with the Commission’s forfeiture guidelines, and based on the seriousness of AT&T’s apparent violations, the FCC proposed a forfeiture of $100,000,000 and a set of requirements to bring AT&T into compliance with the Transparency Rule.
Specific questions regarding the enforcement action or data throttling and disclosure practices should be directed to Jonathan S. Marashlian at jsm@commlawgroup.com.  General questions about the FCC’s Open Internet rules may be directed to Jackie R. Hankins at jrh@commlawgroup.com.

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