FTC Sues AT&T Over Throttling Of Unlimited Smartphone Internet Plans

(RTTNews) - The Federal Trade Commission said Tuesday it is suing AT&T (T) for promising unlimited data plans to customers and then slowing Internet speeds during their browsing.

According to the FTC, AT&T began slowing speeds for its unlimited data plan in October 2011, leading to complaints from customers who accused the company of not conforming with the Internet plans.

The complaint alleges that customers are subject to reduced speed even if they use their smartphone at a time when the network has enough capacity to carry the data traffic.

AT&T said the FTC's allegations are baseless and have nothing to do with the substance of its network management program. "It's baffling as to why the FTC would choose to take this action against a company that, like all major wireless providers, manages its network resources to provide the best possible service to all customers, and does it in a way that is fully transparent and consistent with the law and our contracts."

"We have been completely transparent with customers since the very beginning. We informed all unlimited data-plan customers via bill notices and a national press release that resulted in nearly 2,000 news stories, well before the program was implemented. In addition, this program has affected only about 3% of our customers, and before any customer is affected, they are also notified by text message," the company said.