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Consumer Law

AT&T to pay $60M in settlement for slowing cellphone data

AT&T will pay $60 million to resolve U.S. allegations it misled millions of smartphone customers by charging them for “unlimited” data plans that reduced data speeds if they used too much, the Federal Trade Commission (FTC) said on Tuesday.

As part of the settlement of the 2014 complaint, AT&T is also prohibited from making any representation about the speed or amount of its mobile data without also disclosing any material restrictions on the data.

The FTC alleged that AT&T would begin to slow “unlimited” customers’ data after they used as little as two gigabytes of data in a month. Netflix says that watching its shows uses about 1 gigabyte per hour of standard definition video.

Andrew Smith, director of the FTC’s Bureau of Consumer Protection, said AT&T made promises it did not keep. “While it seems obvious, it bears repeating that Internet providers must tell people about any restrictions on the speed or amount of data promised,” he said in a statement.

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