T-Mobile will pay a $48M fine for throttling ‘unlimited data’ plans
theverge.com
theverge.com
So the way I understood it (at least under the plan that I signed up for before "binge-on" was added), T-Mobile would charge $20 (on top of the regular voice/text plan) for 'unlimited' data. Then, after something like 25GB, they would prioritize data from users that were under that limit if there was congestion. So to me that is entirely reasonable in light of the fact that radio waves have physical limits on how many people can consume high bandwidth at the same time.
Of course, it would be nice if they spelled out all of this in their advertising and product literature (and if this was still the case with their current plans).
Which is ultimately the problem here. They didn't spell this out or make explicit this practice.
I agree with you, it makes sense, and I find it acceptable...but they definitely should have made it obvious and well documented.
I wish they would just not say "Unlimited" if there is going to be a disclaimer, but the current situation is at least fairly clear.
Marketing and sales is the root of all evil.
I'll go out on a limb here and say that 'unlimited' in the case of data/telecom services should be a controlled and regulated word, much like 'organic' and 'natural' are in food.
You can't falsely advertise.
The only reason that "natural" and "organic" are regulated terms is because they are nebulous. But "unlimited data" is not nebulous, it's clear cut.
IANAL
1 month multiplied by the maximum speed of the technology, the actual capacity of the network, the fact that they throttle heavy users, etc.
And if such a small number hurts them in the feels, they could make their network better so that they could say a bigger number.
Sure, that's obvious.
> the actual capacity of the network
Shouldn't that be enough to handle at least the actual usage given that not everyone uses it at full capacity all the time? Probably there's some capacity at which they're mostly capable except the rare event that brings in an extremely large num of users. Probably not obvious?
> the fact that they throttle heavy users
This is definitely not obvious.
> Shouldn't that be enough to handle at least the actual usage given that not everyone uses it at full capacity all the time? Probably there's some capacity at which they're mostly capable except the rare event that brings in an extremely large num of users. Probably not obvious?
That sounds about right. I would expect to get my promised speeds the vast majority of the time.
Now if only we could get hard SLAs I would be really happy. (Max speed 99.9% of the month measured in seconds?)
I guess if you did somehow get one they wouldn't guarantee much of a connection.
[0] https://www.ams.usda.gov/rules-regulations/organic/labeling
Well, maybe.
But given the context, it's like if a car dealer had sold you a new car, then delivered an old and rusty one, and you'd be saying that delivering an old and rusty one is consumer-friendly practice as compared to billing them double what was agreed for the new one.
Also, no, this is not about "marketing language". This is about contract language. Would you also agree that there was a discussion to be had about the "marketing price" that the customer agreed to pay? I mean, the customer only intended to pay half of what they agreed to, so why should they be required to pay the full amount? Marketing language is the catch phrase that you clarify in the fine print. Contract language is what you actually agree to.
Offer unlimited. Or don’t. I don’t see why they use that word and then not honor it.
That is, the infraction is about honesty. I think rulings like this are important. If you can't know if your plan throttles more aggressively than another, you can't make the choice and competitive pressure is taken off the market.
If you actually happen to NEED unlimited data, and someone offers you unlimited data at some speed, and when you go to use it it is not that speed. And now your system does not work as designed.
Are you a happy consumer then? and since everyone get fooled by the false marketing, the actual providers of unlimited data at a certain speed is now out of business, because they had to charge for the real deal.
This is not about having sane limits. It's about false advertising with the only goal of killing competition and stealing business.
And btw, all carriers do that. It's a shame FCC is a tool for AT&T and Verizon nowadays on their plan to split the country into two monopolies. I will bet you money that they will never get a fine like that. ever.
I want direct monetary compensation.
If this were a class action, would the lawyers accept getting paid a truckload of iPhone 7 cases?
Now the equivalent plan (T-Mobile One+) is $90/mo, and that just gets you "unlimited HD day passes" which you have to remember to toggle every day if you want video that isn't 480p.
What's even scarier to me is that they're not alone. Sprint has opted for a nearly identical pricing structure w/ "Unlimited Freedom" and "Unlimited Freedom Premium." As an aside: the idea of "premium" freedom makes me giggle, I'd love to have a beer with the marketing exec that came up with that mouthful.
As an aside: the idea of "premium" freedom makes me giggle,
I'd love to have a beer with the marketing exec that came
up with that mouthful.
I'm a realistic T-Mobile user for ~16 years, have no problem with their network management practices, and will happily hand over my $140/month for 4 lines until the end of time. Its not their fault its a prisoner's dilemma where all carriers are offering "unlimited" data usage, but they all must perform different types of network management due to wireless spectrum being a limited resource.
If you don't like the policy, there are at least three other national carriers to choose from. I'm exhausted from a vocal minority thinking their opinion matters in this regard.
The market has spoken, and does not care.
I always thought it was bizarre how companies charge for tethering, especially after data caps were introduced. Aren't they all the same to the carrier?
Streaming video is different than the tool who decides he's going to torrent tens of GBs over their cellular connection. You're streaming 780p or 1080p content to a device that can't display the additional resolution over 480p? You've just wasted that bandwidth on the local tower (which matters if you're in urban areas).
(Spotify does this right in the sense that it'll cache music locally, even if you have not elected to download your playlists)
> I always thought it was bizarre how companies charge for tethering, especially after data caps were introduced. Aren't they all the same to the carrier?
Non-mobile devices can generate a higher volume of data than a mobile device alone. You can go eat at an all-you-can-eat buffet, but they don't let you bring a wheelbarrow with.
Don't take my word for it though: http://twinprime.com/lte-has-slowed-by-50-in-the-us/
"While the US LTE capacity has remained relatively constant over the last 12 months, the number of users, as well as the bandwidth consumed per user via video and music streaming, video calls, and real-time entertainment like Netflix has resulted in an overall slowdown of LTE across the network.
The reverse effect is observed in new regions like South America, or Eastern Europe. As these areas begin to come online to 4G networks they experience impressive speeds due to the lack of initial subscribers. Eventually, their performance slows as carriers sign up more 4G customers and the LTE resources become more scarce as a result."
What a weird scenario. The current trend is for phones to have more resolution than many desktops.
- Cell carriers should want you to tether on a non-unlimited plan. The more you tether, the more you pay them for data usage! The idea that tethering should cost extra on tiered data is silly, because it's the ability to run up a bigger bill anyways. (As a note, I know Verizon does not charge extra for tethering, I didn't think any tiered data providers still did.)
- Fundamentally, if people are using more LTE on tiered data, they are paying carriers more, so carriers have more money to spend on increasing capacity on our LTE networks. Carriers should want users to spend as much net neutral data is humanly possible.
> Don't take my word for it though: http://twinprime.com/lte-has-slowed-by-50-in-the-us/
The link shows a graph demonstrating that while data usage has gone up each year, smartphones are the majority users of data, while 'Data Capable Units' continue to lag behind.
While you're absolutely right that non-mobile devices (presumably non-smartphones) can (and in many cases do) generate a (much much) higher volume of data than a mobile device (presumably smartphone) alone, the data in the link supplied seems to indicate that as a whole, smartphones continue to be the majority users of data.
Or rather, while a few people may bring in wheelbarrows, few of them are actually filling them up, and the majority of people are just gorging themselves.
But with tiered data plans, we paid for that anyway. I would understand if they offer this as a service we can enable to lower how much data we use, but making it mandatory is weird.
Non-mobile devices can generate a higher volume of data than a mobile device alone. You can go eat at an all-you-can-eat buffet, but they don't let you bring a wheelbarrow with
Sure, but with data caps, why do they care how I use my data? If I want to use more by using my laptop, what difference does it make to them?
Yes. Legere has a cult following which T-Mobile has leveraged these last few years to distract from some anti-consumer and anti-social maneuvers.
In their minds everyone uses adaptive streaming so if they cap "video like files" at 1.5ish Mbps then the quality would bump down.
If the edge of their network thinks you're downloading a video stream they'll throttle the throughput to ~3.5Mbps. This is approximately equivalent to a 480p stream, so intelligent streaming apps (e.g: Netflix, YouTube, et al.) will notice this and downgrade the quality to avoid buffer stalls.
On their new plan "T-Mobile One" this behavior is always on unless you opt out by purchasing an "HD Day Pass." (They upsell you on an add-on that gives you "free HD Day Passes" but you still have to activate them every day.)
On their previous plan "Simple Choice" the network behaves essentially the same, but it was behind a toggle called on your billing profile called "BingeON" whereby if it was shaping your traffic it would zero-rate it on your bill.
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One thing I'm not sure about is how they do traffic shaping in the face of transmitting the stream over HTTPS/TLS, perhaps it's just a whitelist of IPs for known services? (I know businesses get away with shaping/monitoring TLS traffic by using MITM proxies on the edge of the network; but that assumes control of the certificate truststore on your network's endpoints, which T-Mobile doesn't have.)
1. Unlimited data. Data isn't worth anything, just give it away.
2. Tiered data. No one talks on the phone any longer. It's all about data now. We'll charge them per GB to use it!
3. Unlimited everything with extras. Ok, most people are actually not using that much mobile data. Wifi is all over the place, and when given the option of paying more or constraining their mobile data usage, most people opt for the latter. Let's start selling them premium features instead.
This seems like something you could build into your phone. Every day when you first interact with your phone, have tasker or something else fire off a job that auto-enables your unlimited hd day passes.
Does anyone have good introduction documentation to either: writing scripts for tasker, or writing your own android applications when you know ZERO java?
Do you know any programming languages? In addition to non-Java JVM-based languages (like Clojure and JRuby), which should work in theory (and in some cases do work in practice, like with Ruboto), there's also stuff like Cordova (though I don't know if Cordova can do what you're looking to do).
This doesn't help you; I just wanted to whine about another great service being shut down.
Sprint claims an average of 3-6 Mbps[1]
[1] https://shop2.sprint.com/en/stores/popups/4G_coverage_popup....
I checked my apartment and it's shown solidly inside a 4G LTE coverage area. In reality, I'm lucky to get 2 bars of 3G, and I avoid talking on the phone because it'll drop the call.
E.g. If they saved less than $24 million and had a >50% chance of getting caught, this works perfectly well as a deterrent no matter how large there overall profits were.
So if choice 1 is $70/month for 25GB and $10 for 10GB afterward, and choice 2 is $90/month for 'unlimited' with an expectation to use 45GB, then both choices are equivalent.
If the choice 2 then reduces the utility of the service by 50% past 25GB, then the customer has paid $20 for $10 of utility, and so the loss should be marked as $10.
And if you buy choice 2 because it says 'unlimited', but you only use 5GB, then you never actually lost anything due to their deceit.
I'd expect a similar calculation to hold up here: For each customer, sum up the number of throttled hours over the number of total hours to get the "throttling percentage". Also, assign each zip code a 'statistical competitor' by combining all competing services using some model. Then multiply the throttling percentage by the difference in price multiplied by the percentage of utility lost.
In fact, for federal common law, it's about a 1:1 ratio, and for everything else, it's supposed to be "single digit multipliers".
See exxon shipping v. baker and following cases.
So, of course, agencies keep their fines within precedent because they actually want to be able to defend them in court.
Ignorance is bliss though, blame lobbying.
(since some have privately asked: no, i think this kind of restriction is pretty much BS, but it is the law of the land, and it is one of the main reasons agency fines are so low in cases like this. The amount t-mobile gained by throttling unlimited data is pretty small, at least if their percent of users going over x amount of data numbers are correct)
Because disagreements must be rooted in ignorance (sarcasm).
How pointlessly rude.
That's more than a slap on the wrist. It's 10% of their profit. How would you like to be fined 10% of your leftover money after your bills are paid? That's a decent chunk of skin.
I actually believe it's a pretty fair punishment. I believe comparing it to revenue is irrelevant because it's an extremely capital-intensive process. If it takes 32B to make 0.479B, their margin is about 1/64th!
Profit is a terrible metric, it measures the efficiency of your organization.
The comparison to fundamentals is really a red herring.
PP probably only brought it up in response to the poster before them.
It may not be easy to compute the damages, but I agree with the point above: the fine is NOT a slap on the wrist. It represents a sizeable chunk of the company's profit.
If we buy a thing for $10, we expect that to be a baseline, as we may pay tax or gratuity on top of that. If I go to the store and buy something for $9.99, my mental calculation is that it may actually cost $10.70 or so with tax. If I go to a restaurant and buy a $20 steak, my expectation is that will probably cost $25.
But if I go to a restaurant and order a steak and they serve me a soy burger, that will not be acceptable. An "unlimited" plan not, in fact, being unlimited is different than what you've described.
http://i2.cdn.turner.com/cnn/2009/images/10/28/net.neutralit...
Partners don't pay to be included in Binge On. Requirements to be included in Binge On: https://www.t-mobile.com/content/dam/tmo/en-g/pdf/BingeOn-Vi...
For e.g: AT&T U-Verse will let you remove the cap[1] using a $30 add-on. However they'll also remove the cap "for no extra charge" if you subscribe to one of their bundles. (Which works out to about the same price, for the 2-year promotional period anyways, after which you'll be renegotiating your bill with retentions.)
I suspect they're doing this so that if you really need the bandwidth: you'll find the basic TV subscription to be a much better use of the $30. That way they get to tell their shareholders they've stopped hemorrhaging pay-TV subscribers.
I flat-out refused the sales guy as soon as I saw the 600GB cap in the fine-print of the contract. He tried to tell me most people don't get anywhere near that figure. Now I don't doubt that statistic, but I have my own statistics. I pulled up my router's bandwidth report[2] and showed him that my network would bump up against that cap nearly every month.
[1]: https://www.att.com/esupport/article.html#!/u-verse-high-spe...
If you look at how businesses generally work, they're trying to get a certain amount of revenue in order to balance their budget and make a profit. Then they decide how to get it.
Data caps are fantastic. Because it means when they're raising their prices, they're charging the users who most use it, rather than just raising the price for everyone.
If you're being asked to pay for overage on a wired line plan, it means you're a 1%er in the Internet world. You're a burden on the system with how much you use, and you're upset you're being asked to pay a little more than everyone else.
Basically, people opposed to data caps are like Wall Street execs complaining their taxes are higher than everyone else's.
And as a side note, I've never hit the cap - I'm not sure it's turned on yet (Comcast customer), but it's coming. But I won't have one soon because I'll be switching to a different ISP as soon as it's available. But if I stayed with Comcast, I would hit it as soon as I get a 4K TV and start watching 4K sources.
EDIT: minor change.
Source: I run a small ISP.
And 100mbit of CIR per person isn't the right metric either. We're in a consumer context here, where bandwidth can be massively oversubscribed without capping or running out. That doesn't mean they're not actually selling that much bandwidth.
You can tell me if I'm way off-base on any of the following: Comcast claims that only 8% of their users average more than 1mbps, even in areas without caps. If we assume most of those 8% are using 5mbps and the rest use an entire 100mbps, we might get an average data use of 3mbps per customer. In terms of transit costs, that's nothing. Less than a dollar per mbps in bulk. Almost all the cost is in supplying the pipe that's capable of bursting to 100mbps. So there is no real need to have these caps. Just sell unlimited data.
My water company doesn't shut off my water because I took too many long showers this month. My gas company doesn't shut the valve because I had a few extra loads of laundry to run through the dryer. My electric company doesn't kill the lights because I was working on my car and used the 220V in the garage a lot this month.
Instead they install a meter at the inlet, charge me for exactly what I use (and when I use it!!!) and then they can plan their capacity based around their billings. If I need more inlets (too much current at the mains breaker, not enough gas or water pressure, etc.) then they charge me a fair price for the hardware and installation and bill that new inlet in the exact same way.
It's simple, transparent, and completely controllable by me. (If I don't want to rack up a larger bill this month I just close the inlet.)
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Caps and overages are a very different model: they are charging me much more than the normal cost of service once I cross some threshold or cutting off my service. That'd be like my power company saying: "you've used more than the average 901kWH, so you're going to have to pay the industrial rate on the rest of your consumption this month."
More importantly, since private companies are running the show, we have no real insight into what average data consumption for the populace even looks like. You take it on their word that the plans they market align w/ the reality of average use. We can't verify that's the case because they don't legally have to publish it.
Essentially these companies could be telling you "640k ought to be enough for anybody", and you're arguing that it's perfectly reasonable for them to say anyone using >640k is the top 3% and should be billed at a premium. That's not the sort of thinking that pushes the state of the art forward, in fact it's actively harmful and disincentivizes upgrades to the network.
Their pricing model doesn't line up with the reality of a band-limited service, and they don't give us nearly enough information to verify their claims of what constitutes an "above average" consumer of data.
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- Wireline service should be billed as a metered utility.
- Wireless service should have a fixed access fee to cover the cost of expanding the network (as well as providing E911, etc.) along with a variable access fee that is billed as a metered utility.
Anything else is borderline fraud, and I'm frankly sick of having to navigate the minefield of dishonesty that is consumer-grade ISP pricing schemes.
I definitely would prefer a more even metering method, and I think it should be granular down to the megabyte. But data caps are a move in that direction, a very positive move from where we were in the unlimited-but-not-net-neutral past.
Generally speaking, you are not getting charged for "much more" than the normal cost of service, if you have picked a good level for your data plan. Should be just over your usual usage, you might occasionally get an overage once or twice, but it should round out to be cheaper than having picked a higher tier every month.
Anyone who asked, I told them that T-Mobile's policy was WAY more consumer friendly than the other carriers, especially for someone who absolutely needs a data connection (and doesn't wander outside their relatively weak coverage)
What if the FCC mandated some kind of 'nutrition label' for ISP plans, that specified the technical points of their service offering? Spell out limits, min/max latency, best-effort/guaranteed, fair/shaped and what happens when limits are exceeded? Wouldn't be clearly in their realm of power to regulate how the these plans are marketed, rather than let the ISP's confuses folks with ambiguous language?
0: https://www.fcc.gov/consumers/guides/consumer-labels-broadba...
I honestly find it, always and everywhere, to be deceptive marketing. There is no such thing as unlimited resources.
I understand that the word unlimited makes people feel good, but it shouldn't. Nothing is unlimited, ever. Just because they're not telling you what it is doesn't mean it isn't there.
Unmetered bandwidth that is capped at a gigabit or is physically incapable of going faster is not unlimited either. It's been throttled to only allow you to download a certain amount each month. It is also not unlimited, unless you consider a throttle to not be a limit.
Most cable modems, by the way, can go 3-5 times faster without the artificial throttles put on them by the providers. So even before Comcast started doing their stupid 1TB cap, they were already throttling your internet connection way below the possible speeds of the device.
This approach let's the host plan capacity while giving users the illusion of unlimited bandwidth. Meanwhile customers that genuinely need the extra throughput can still get it at a premium.
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This is essentially what T-Mobile is doing, they're just not being transparent about it. You can have "unlimited" bandwidth at ~3.5Mbit/s (a 480p video stream), or you can pay a premium to saturate your link. They're just choosing to apply the throughput restriction to a specific class of traffic (HD streaming) because (A) it's a large fraction of their total traffic and (B) it's fairly easy to market to customers.
Of course there is no such thing as truly unlimited, but it can certainly be "unlimited" in one dimension. The issue here is that's not how T-Mobile is marketing it, they're marketing their network as "the fastest LTE network"[1] while also saying you have unlimited monthly bandwidth. The latter may be true, but it comes at the expense of throttling the throughput (for some fraction of subscribers); and once you throttle a subscriber you can no longer say you're providing them with access to "the fastest LTE network in America."
[1]: https://newsroom.t-mobile.com/news-and-blogs/lte-advanced.ht...
That said, I do prefer to know my limits
"Unlimited" hosting plans are effectively geared for basic personal or small business websites only. And if you go over some soft limits they're almost certainly monitoring, they'll find an excuse in the TOS to disable your account.
Of course, given that my wife is the one who has to deal with the kids watching neflix on her phone, when you hit the limit, the result is frequently the same as just getting cut off if you have to wait 30 seconds to load google.com or much worse for sites with a lot of content.
Plans for more than 5GB have been available for quite some time and if one were calling the business hotline all networks could offer even larger non-public plans.
well, it's a start.