Last month, when I was in California for a work trip, my phone suddenly became useless. Even though I was in downtown San Francisco, the data connection was so slow that it was pretty much impossible to download email, use apps, browse the Web or load photos on Instagram.
I was being "throttled." AT&T had deliberately slowed down my data speed because I used more than five gigabytes during a billing cycle, even though I have had an unlimited data plan since 2009. (AT&T no longer offers unlimited data plans, but I have renewed my contract, so I've been allowed to keep it.)
AT&T began throttling in 2011. But the policy was thrust into the spotlight this week, when the Federal Trade Commission sued the telecom giant for slowing data speeds, sometimes by more than 90 percent, for unlimited data customers without "adequately disclos[ing]" the policy.
“AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” FTC Chairwoman Edith Ramirez said in a statement announcing the lawsuit. “The issue here is simple: ‘unlimited’ means unlimited.”
AT&T shot back, calling the suit "baseless" and pointing to a press release and "2,000" subsequent news articles when the company made the changes in 2011.
"[B]efore any customer is affected, they are also notified by text message," Wayne Watts, AT&T's senior executive vice president and general counsel, said in a statement Tuesday.
The FTC said AT&T has throttled 3.5 million customers a total of 25 million times. I'm one of those customers.
Here's the thing. Even though I've gone over five gigabytes in four of the last five months, I've only gotten one text message from AT&T warning me that I was approaching the threshold. That was in May. Last month, my phone slowed without warning.
When I reached out to AT&T about why I only got a text message that first time, and I didn't get a text message each time I approached five gigabytes in a month, the company pointed to an obscure page on its website informing customers that their "speeds may be reduced without another text message reminder."
The company also said I had received a notice with my bill in summer 2011 announcing the changes. But as the FTC points out in its lawsuit, the notice doesn't "disclose the degree to which the customers’ data speed would be reduced,
and the impact that the reduced speed would have on customers’ ability to use their device."
"We stand by the statement from earlier this week," Mark Siegel, AT&T's executive director of media relations, told The Huffington Post in a phone call. "And we stand by what is available on our public website about how we handle our unlimited data customers."
AT&T could easily send texts each time customers approach the five gigabyte threshold. After all, the company sends texts when your bill is due, when it's paid, if you are going over your voice minutes and when it's added a cell tower in your area. Or it could send an email. I've received at least seven emails from AT&T this month, five for promotions or trying to get me to upgrade.
But throttling is something AT&T appears to want to keep quiet. Researchers hired by the company to conduct focus groups about throttling suggested not talking too much about it, according to the FTC lawsuit.
The researchers observed that “[t]he more consumers talked about it the more they didn’t like it.” This led the researchers to advise that “[s]aying less is more, [so] don’t say too much” in marketing communications concerning such a program.
AT&T says it throttles customers to manage network congestion. But the FTC says throttling happens even when the network isn't congested. AT&T doesn't throttle those people on its other data plans who use significant amounts of data, the FTC says in the lawsuit.
AT&T seems to use throttling to encourage unlimited data customers to sign up for tiered data plans, which make them pay for as much data as they use and can be more expensive for heavy users. Those who quit AT&T's unlimited data plans, the FTC points out, have been hit with early termination fees in the hundreds of dollars.
Verizon also has customers holding onto unlimited data plans, even though it doesn't offer them anymore. The company announced over the summer that it would throttle heavy unlimited data users during peak times, but backed off after receiving widespread criticism, including from the chairman of the FCC.
Unlimited data customers are not as valuable to the companies as those with tiered plans because they will pay the same each month regardless of how much data they use, forever. Data use is predicted to explode to 9.1 gigabytes a month in 2018, from 1.4 gigabytes per month last year, according to Cisco.
Bekim Ukperaj, who works at a golf course in Stamford, Connecticut, and admitted he uses his phone "a lot," said he regularly exceeds five gigabytes of monthly data and is throttled. AT&T said it sent Ukperaj two text messages in January 2013 as he neared the data threshold, and included the throttling notice in his bill in 2011. But Ukperaj said he doesn't remember any notification that he was nearing five gigabytes. He now uses a tool on his LG G2 smartphone to alert him when he's getting close.
"A warning would have been nice in all those previous months I didn't alert myself," Ukperaj said, adding that sometimes his phone was useless for weeks while it was throttled. Ukperaj said that when he renewed his unlimited data contract in December, AT&T representatives didn't warn him that he could be throttled. "You'd think that if you renewed your contract, they'd say something more about the data limiting," Ukperaj said.
AT&T's 4G LTE network typically has download speeds of five to 12 megabits per second (Mbps), according to the FTC. When I was throttled in September, my download speed was cut to a slow 0.17 Mbps, rendering most of the functions on my smartphone useless.
Results of a speedtest while being throttled (left) and before being throttled (right).
"You're looking at data speeds that pretty much predate the smartphone era," Bill Menezes, an analyst who specializes in mobile networks at Gartner, the technology research firm, said when he reviewed the results of the speed test I conducted while being throttled in September.
Frank Guido, a Staten Island, N.Y.-based photographer, was so frustrated with his throttled data speed of 0.46mbps that after dealing with it for only two days he called AT&T and switched to a data plan he now shares with family.
"I'm away from home days at a time for my job so I can't live on Edge speed," he said, referring to the older, slower network.
He was an AT&T unlimited data subscriber who regularly went over five gigabytes a month, though he only first noticed his phone's data connection was slow over the weekend. He said that he has never received a text message or an email telling him he'd get throttled if he went over a certain number of gigabytes.
But after the FTC lawsuit was announced, he called to switch back to his unlimited data plan. Because AT&T no longer offers the plan, his request has to be approved by management. He'll find out in early November if AT&T approved the switch.