T-Mobile will be paying the Federal Communications Commission (FCC) $48 million as settlement for misleading mobile users with regards to its unlimited data plan. Just this week, the government agency revealed that through an investigation, the major wireless carrier was found to have not done enough to make the connection speed and data restrictions on its unlimited data plan clear to consumers. The FCC had gotten some complaints from subscribers of T-Mobile’s unlimited data plan, claiming that they were not notified that their data would be throttled to virtually impossibly slow connection speeds after they go beyond 17 gigabytes in any given month.
According to the terms of the agreed settlement, T-Mobile will pay a fine of $7.5 million to the US government, while another $35.5 million will provided as consumer benefits to customers of T-Mobile as well as the wireless carrier’s prepaid arm, MetroPCS. But what kind of consumer benefits exactly? These include giving discounts to T-Mobile and MetroPCS unlimited data subscribers of 20 percent off or up to $20 off the normal pricing for any accessory (as long as the item is available in stock), plus 4 gigabytes of extra data for any wireless mobile data line of service. Qualified customers of T-Mobile and MetroPCS should get their notices regarding the consumer benefits by December 15th of this year. As for the remaining $5 million, this will be used to fund free mobile devices donated to students from low income households, as well as provide free wireless service for these handsets (just like what Sprint is doing).
Moreover, T-Mobile will have to make its policy more clear to subscribers from here on. Whenever it feels that its network is getting congested, T-Mobile adheres to its policy of de-prioritizing users who consume a lot of data. According to the FCC, this particular policy was not found to be sufficiently conveyed to mobile users, thus violating the Commission’s Open Internet order (established six years ago) which stated that providers of Internet services should be able to disclose accurate and adequate information about the services they are offering to consumers. As explained by Travis LeBlanc, the chief of the FCC’s Enforcement Bureau, users should not be made to speculate on aspects such as connection speed restrictions and data caps. If these are part of the deal being promoted by service providers, it should be expressed clearly in ads and disclosures.
This marks the second time that the FCC has punished a mobile operator for misleading customers in its unlimited data plans. In June of last year, another major US wireless carrier, AT&T, was made to pay a fine amounting to $100 million for a similar practice. And it is not just carriers getting penalized by the FCC -- a week ago, cable giant Comcast was slapped with a $2.3 million fine for billing users for services they never wanted in the first place.
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