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T-Mobile Fined $48 Million For Hidden Limits On Unlimited Data Plans

The Federal Communications Commission found that T-Mobile unfairly slowed the internet service of some of its customers.

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If you’re covered by an unlimited data plan from T-Mobile, you may have been led to believe that the service you’ve purchased is faster than what you truly receive, according to the Federal Communications Commission, the nation’s telecommunications regulator. As a result, T-Mobile will be forced to pay $48 million in fines and consumer benefits to settle an investigation into the way the company conveys what “unlimited data” actually means.

According to the FCC, T-Mobile failed to make clear to its customers that its unlimited plan includes restrictions on speed and data. Under its policies, T-Mobile can throttle the internet service of its customers who use the most data each month, but the FCC found that this information wasn’t properly shared with customers through ads and disclosures, depriving these people of the real internet speeds that were marketed to them. Based on complaints from T-Mobile and MetroPCS customers who felt misled, the internet slow-down policy left their services “unusable’ for many hours each day,” which limited their access to the internet, and runs counter to transparency rules on adequate disclosure.

“Company advertisements and other disclosures may have led unlimited data plan customers to expect that they were buying better and faster service than what they received,” the FCC found. T-Mobile “failed to adequately inform its ‘unlimited' data plan customers that their data would be slowed at times if they used more than 17 GB in a given month.”

As part of the settlement, eligible T-Mobile and MetroPCS customers will be offered 4 GB of additional data if they’re covered by the “Simple Choice Mint” plan and a 20% discount off of phone accessories. These benefits will account for at least $35.5 million of the settlement. The company will also be forced to provide free tablets to public school students as part of a 4-year initiative to close the “homework gap,” totaling at least $5 million. The remaining $7.5 million covers a fine paid to the US Treasury.

To address what the FCC concluded were inadequate disclosures to customers, T-Mobile will now clearly define who may be affected by these slow-downs and notify them when they near the 17 GB threshold. And when the company markets its services, it must either remove the term “unlimited,” spell out the restrictions that come with those plans, or stop throttling its customers.

“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 in a statement. “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.”

When asked for comment on the settlement, a T-Mobile spokesperson directed BuzzFeed News to a tweet sent by CEO John Legere.

Good settlement with FCC today. @TMobile believes more info is best for customers. #themoreyouknow https://t.co/XFY6dHPfN6

Hamza Shaban is a technology policy reporter for BuzzFeed News and is based in Washington, DC.

Contact Hamza Shaban at Hamza.Shaban@buzzfeed.com.

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