It has been widely reported that the Federal Trade Commission has sued AT&T Wireless, claiming that AT&T engaged in unfair and illegal practices. See a copy of the complaint here.
Many of those reports claim that the FTC has sued AT&T for throttling back the amount of data throughput it made available to wireless customers. Based upon such reports, commenters have said that the FTC’s actions prove that the FTC is willing to police and capable of policing net neutrality issues, including cases where a data services provider throttles back access to websites disfavored by the provider for its own commercial reasons.
In fact, the FTC’s case is more limited and does not necessarily have anything to do with net neutrality issues. The FTC’s suit claims only that AT&T erred in the way it marketed it services.
What the FTC says is that AT&T represented that it would provide customers with unlimited mobile data and then, when it suited AT&T, failed to deliver on that representation when it adopted throttling practices. The FTC claims that the throttling reduced access by as much as 90%, rendering Internet access functionally inoperable.
AT&T has been stung by the complaint, and some have characterized AT&T as baffled by it. Presumably this means that AT&T believed that its throttling practices constituted good-faith measures to protect the broader network from facing undue congestion caused by heavy users.
For its part, the FTC says that AT&T would have been in its rights to unilaterally terminate unlimited data plans and to transition those customers to limited data plans once their existing contracts ended. Lastly, the FTC says that AT&T’s contracts with its customers do not give AT&T authority to take unilateral action to throttle access.
So in the end, all the FTC suit stands for is that AT&T should have been more creative in drafting its contracts so as to have anticipated its business desire to throttle service.
Thus, the complaint is, for the moment, a visible government action that will likely cost AT&T to settle, but aside from that, the only relief it ultimately calls for is for AT&T to adopt in its contracts language providing AT&T with even broader rights than AT&T already has. This should not be particularly troubling, as virtually no one reads the contracts, any more than they used to read the carrier tariffs on file at the FCC or the state public service commissions. No one knows this better than the wireless carriers.