The Federal Communications Commission (FCC) just slammed T-Mobile with a $48 million fine for offering misleading “unlimited” data plans. The FCC took issue with T-Mobile’s unlimited data plans that put a cap on 4G LTE speeds and, after a specific amount of data was used, actually throttled the speeds.
The government regulator said T-Mobile wasn’t clear enough with its customers, even though T-Mobile has argued that a tiny 3 percent of its customers actually ever hit that cap.
“Consumers should not have to guess whether so-called ‘unlimited’ data plans contain key restrictions, like speed constraints, data caps, and other material limitations,” FCC Enforcement bureau chief Travis LeBlanc said. “When broadband providers are accurate, honest and upfront in their ads and disclosures, consumers aren’t surprised and they get what they’ve paid for. With today’s settlement, T-Mobile has stepped up to the plate to ensure that its customers have the full information they need to decide whether ‘unlimited’ data plans are right for them.”
T-Mobile will be required to make it more obvious to its customers that there is indeed a data speed cap on unlimited plans, and will need to tell customers “what triggers its application and the impacts on data speeds.” That means the carrier probably can’t just bury this information in the small print, as it usually does.
Update: T-Mobile tells me it has already updated its disclosures with clearer language for customers.
How you’ll benefit from FCC’s investigation
T-Mobile’s fine is split into several buckets. $7.5 million will be paid to the U.S. Treasury, while an additional $35.5 million needs to be paid back to MetroPCS and T-Mobile customers through benefit programs. $5 million will also be spent to “improve mobile high-speed internet access for up to 80,000 low-income public school students,” T-Mobile said. Customers who were affected should receive up to 20 percent off of an in-stock accessory, the FCC said, though the discount can’t exceed $20. The FCC is also requiring the FCC to tack on 4GB of additional data for eligible customers on both carriers.
The FCC says T-Mobile and MetroPCS will alert their subscribers of those incentives by December 15.