Is Your Wireless Carrier Throttling Data? Sue ’em!
An AT&T customer whose iPhone data was throttled took Ma Bell to court--and won. If carriers want to play games with the meaning of "unlimited," consumers can and should fight back. Let's all throw the (law) book at them, says CIO.com blogger Bill Snyder.
When AT&T and some of the other major carriers stuck a fork in unlimited data plans for new subscribers, I wasn’t happy about it, but frankly, it seemed fair. Use more; pay more. However, a later wrinkle, throttling speeds of heavy users on existing unlimited plans, seemed altogether outrageous. And now, I’m happy to say, a Superior Court judge in California agrees with me, and has awarded damages to a throttled AT&T customer.
Matt Spaccarelli, an unemployed truck driver and student, didn’t get much money, only $850. But now we have a precedent, and since it doesn’t cost much to bring suit in a small claims court in most states, I say others who’ve been throttled should go for it. If AT&T slows you down because you’re using what you paid for, take the bozos to court. If nothing else, a pile of those suits will give AT&T pause about imposing other obnoxious conditions on users of its data plans. Hey, we might even get them to back off.
Here’s what this case is about. AT&T still has millions of smartphone customers who were grandfathered in when the company killed unlimited data plans for new subscribers. Last year it told them that smartphone users with unlimited data plans will be throttled (that is, have speeds sharply curtailed) when they’re in the top 5 percent of data consumers during a billing period.
Spaccarelli, according to the Associated Press, said Ma Bell started throttling his phone after he consumed 1.5 GB to 2 GB of data within a billing cycle. He could still use his phone for calling and texting, but it was too slow to stream videos. It’s likely that he could view websites, but only at a relative crawl.
Angered, Spaccarelli took AT&T to court, and Judge Russell Nadel, who sits on the bench in Simi Valley, Calif., ruled in his favor, although AT&T says it will appeal.
Judge Nadel said it’s not fair for AT&T to make a promise to Spaccarelli when he buys the phone while burying terms in his contract that give the company the right to cut down data speeds, according to an AP report.
You would think that Spaccarelli would have taken his case to a jury trial, or maybe started a class action suit against AT&T. But he couldn’t. AT&T’s contract with users has a clause that says they cannot take claims about the contract to a jury trial or consolidate their claims as part of a class action suit. That sounds outrageous, but the U.S. Supreme Court, in yet another 5 to 4 decision, upheld the clause last year. Since that’s the case, the only remaining legal remedy is to go to small claims court.
Of course, one could always switch carriers. But Verizon, which also deep-sixed unlimited data plans, keeps users in line with something they call “data optimization,” which is based on network traffic. If you’re one of those greedy top-tier users and you’re near a congested data node, you may experience a slowdown, but if you’re not near a congested node, your data speed could be normal.
T-Mobile, which still offers unlimited data plans but doesn’t offer the iPhone, has a complicated relationship with throttling. For a while it was throttling heavy users. Then T-Mobile retreated part of the way, saying that new users who exceed a certain limit won’t be throttled, but will be charged more in any billing cycle in which they go over. Users with existing contracts who hit the limit will still be throttled. And now, they’re going to cut off customers who use too much data when traveling in an area that T-Mobile serves indirectly by piggybacking on other carriers. Yikes! Who could ever figure that out?
Deliberately obscure contract provisions are bad enough. But what really fries me is the pretense by the carriers that “unlimited data” doesn’t really mean unlimited data. It means something else, and they get to decide what. How’s that for fair?
San Francisco journalist Bill Snyder writes frequently about business and technology. His work appears regularly in CIO.com and the publications of Stanford's Graduate School of Business and the Haas School of Business at the University of California at Berkeley. He welcomes your comments and suggestions.