On October 19, 2016, the Federal Communications Commission’s (“FCC” or “Commission”) Enforcement Bureau (“Bureau”) entered into a Consent Decree with T-Mobile USA, Inc. (“T-Mobile”) terminating the Bureau’s investigation into whether T-Mobile violated the FCC’s Open Internet Transparency rules by failing to provide accurate and sufficient disclosures regarding its policy of de-prioritizing the data usage of customers with unlimited data plans (“UDPs”) that exceeded a certain data usage threshold.
In March 2015, the Bureau commenced an investigation into T-Mobile’s data de-prioritizing practices and found that T-Mobile’s disclosures about the de-prioritization policy were not sufficient to advise customers about the limitations on UDPs 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.” During the investigation, the Bureau received hundreds of customer complaints about T-Mobile’s de-prioritization policy.
As part of the Consent Decree, T-Mobile agreed to update its online disclosures and point of sale marketing materials to clearly disclose any limitations on data speed and usage, and to notify individual customers when their data nears the threshold that would trigger the de-prioritization policy, to spend at least $35.5 million to provide customer discounts and at least $5 million to address the homework gap in low-income school districts, and to pay a $7.5 million civil penalty, among other concessions.
Clients are advised to ensure that any limitations on mobile data usage, particularly associated with plans marketed as “unlimited,” are adequately disclosed to customers consistent with the FCC’s Open Internet Rules. Clients with questions about this advisory should contact Jonathan Marashlian at email@example.com or Jackie Hankins at firstname.lastname@example.org.