FCC Fines AT&T For False Data Plan Promises

Transcript

RENEE MONTAGNE, HOST:

Wireless carrier AT&T is facing the largest fine ever, proposed by regulators at the Federal Communications Commission. The company could have to pay $100 million for falsely promising unlimited data plans to its customers. NPR's Joel Rose reports.

JOEL ROSE, BYLINE: AT&T based one of its recent ad campaigns on the simple premise that more is better than less.

(SOUNDBITE OF AD)

UNIDENTIFIED ACTOR #1: (As character) We want more. We want more. Like, you really like it...

UNIDENTIFIED ACTOR #2: (As character) Right.

UNIDENTIFIED ACTOR #1: (As character) You want more.

UNIDENTIFIED ACTOR #2: (As character) I follow you.

UNIDENTIFIED NARRATOR: It's not complicated. More is better.

ROSE: But federal regulators say AT&T has been giving some of its customers less than it promised. The FCC says AT&T misled consumers who signed up for wireless plans they believed would allow them to send and receive unlimited data. But once consumers reached a monthly limit, the FCC alleges that AT&T slowed their upload and download speeds by as much as 90 percent. The $100 million fine is the biggest the agency has ever proposed against a single carrier.

HAROLD FELD: What the FCC has been saying here very emphatically is there's a new sheriff in town.

ROSE: Harold Feld is with Public Knowledge, a nonprofit that advocates for consumers. He says the FCC is starting to get more aggressive with big wireless companies.

FELD: If carriers think that it's a small cost of doing business to pay small fines, then they'll continue to nickel-and-dime all of us. If they see that the agency's going to treat this seriously and hand out fines that really matter, then they will think twice before playing fast and loose with consumers.

ROSE: AT&T declined an interview request for this story. In a statement, the company says this is a reasonable way to manage traffic on its networks and that it has disclosed the practice to consumers. FCC Commissioner Ajit Pai wrote a dissent against the agency's proposed fine. Pai also happens to be an AT&T customer.

AJIT PAI: I myself have seen the disclosures in my bills. I've seen it through occasional text messages. We might not like what AT&T's policy was, but nonetheless, they did in fact disclose it repeatedly over the years.

ROSE: But critics dispute whether AT&T disclosed the practice when it sold the service that it billed as unlimited. The company is already facing a lawsuit by the Federal Trade Commission, which enforces rules against deceptive advertising. AT&T has 30 days to respond to the allegations before the FCC makes a final decision. Joel Rose, NPR News, New York. Transcript provided by NPR, Copyright NPR.