The FTC goes after TracFone for "unlimited" data throttling

FTC goes after TracFone for ‘unlimited’ data throttling


This sort of promotion is what got TracFone in trouble. Photo: StraightTalk
This sort of promotion is what got TracFone in trouble. Photo: StraightTalk

Although unlimited data was a promise carriers like AT&T once used to lure potential customers to their network, it doesn’t really exist anymore. Even if you have an unlimited data contract, carriers will throttle your connection once you push a certain data allowance every month.

Yet it’s starting to look like the Federal Trade Commission might be moving against carriers that throttle so-called “unlimited” connections. The FTC just smashed TracFone with a $40 million fine for throttling customers of its unlimited data service.

Since 2009, TracFone has advertised unlimited service using a variety of brand names, including Straight Talk Wireless, Net10 Wireless, Simple Mobile and Telcel America. They market themselves under the banner of offering customers “unlimited everything,” but that’s not so.

According to the FTC’s ruling against TracFone:

TracFone broke the “unlimited data” promise it made to millions of consumers by substantially reduced the speed of their service if customers went over certain fixed limits in a 30-day period. Throttled customers often experienced slow-downs of at least 60% and sometimes even 90%, significantly impairing their ability to engage in the very activities people buy a data plan for. Customers whose service was cut off couldn’t send or receive mobile data at all.

This settlement doesn’t apply to other carriers like AT&T, Verizon, T-Mobile and Sprint, but it does suggest that the FTC might one day put the biggest throttlers in their sites … at the very least, if they don’t advertise their so-called “unlimited” services accordingly.

Source: FTC

Cult of Mac's Newsletters

Daily round-ups or a weekly refresher, straight from Cult of Mac to your inbox.

  • Weekender

    The week's best Apple news, reviews and how-tos from Cult of Mac, every Saturday morning. Our readers say: "Thank you guys for always posting cool stuff" -- Vaughn Nevins. "Very informative" -- Kenly Xavier.