TracFone to Pay $40 Million For Not Disclosing Throttling

Looks like AT&T's new competitor in Mexico plays the same games with TOS as AT&T. Should be an interesting battle with both companies marketing departments constantly lying to customers.

They just used to cut people off and cancel their line after some imaginary limits (losing their number) at first, and that was mostly w/ ATT not Tmobile. I had tmobile/ST for kids and they went crazy.... Verizon came after the storm... According to their early ToS you couldn't use video or audio which is of course ludicrous. It was "web" access. Please..

If you go to their websites today they clearly outline limits and speed after hitting caps quite plainly...

Most MVNO to this day--even major ones (Cricket/ATT) still are not clear on what the actual throttle is on the service INITIALLY or at throttle because many of them throttle within the service amount too. It's typically 8 Mb or so, which normally doesn't matter, but to some people this is important. And some cut off your data, or make you call in after specified limits..

Hoforums is your friend to ask questions in the prepaid forum...

I think that is total bs, and this should be mandatory but they have let these guys get away with this for a long time.

I had unlimited when it really was unlimited (2009?), then they started throttling me.

The FTC (along with the FCC) is currently after AT&T: »AT&T May Face FCC Fine Over Throttling Connections

Which is stupid because they never stopped the connection nor billed for overages. It's also not the provider's problem for the customers not reading any TOS/AUPs. They still gave Unlimited Data. Carlos should go after the FTC.

I hate to play Devil's Advocate here but technically it is unlimited data. You can still use as much data as you want, just at a slower speed when you hit a specific number.

It's not like they are stopping you from using more than that specific number of GBs or making you pay more for that data, they are just slowing your speeds down; meanwhile you can still use the unlimited data.

Unlimited data doesn't mean unlimited data at full speed, it only means you have no limits to how much data you can use.

I tend to disagree. Unlimited to me indicates I can download at whatever speed they can deliver and my network or device can handle it. If I need to pull a 10gig CAD file for work then I can get it as fast as it can be delivered.

Throttling effectively limits the amount of data you can download by proxy of speed limits on the connection. If you get capped to about 56k after your 5gig hidden ceiling then you are effectively limited to about 15gig total for the month assuming you can actual use it 24/7.

Somewhere in the middle is disclosing (or not) that it will be throttled but still no charges for overages. TracFone apparently didn't disclose throttling. There needs to be another marketing term for unlimited throttled no overages vs unlimited with no throttling.

While I do see both of your points of view, I do have to agree with cahiatt, the reason being is he's hitting the nail right on the head, by throttling the company is technically setting a limit to how much you can use in a month on your so called "unlimited" service, so it's not a true unlimited data service, but trparky you are correct as well, because you can use your remaining (15GB's at 56k speed?) without overages or having to pay more, problem is, what do consumers believe the word unlimited means?

I also have to agree with him because I feel the same way, "Unlimited Data" to me means just that, however much data you can download in a month with no limitations, if they are going to throttle then it needs to be correctly called what it is, Limited Data, or Unlimited Data With Limits, I also understand people don't read the ToS, personally I don't either, however I feel that if a company is going to sell you a plan that's "Unlimited" but has throttling, then that information MUST be provided by a Customer Service Representative upon purchase...

So far I've never been throttled by Verizon, however this last weekend when I was utilizing my VPN, after I was done using (and even rebooted the phone, and moved to another part of Dallas putting me on a different tower) I had a very limited connection no matter what, only like 3 down and 1 up and sometimes high pings even though it showed 4G LTE on the phone and I usually don't average above 40ms on the pings, not sure if this was a trial where Verizon is finally throttling Unlimited Grandfathered users, or if they were just having an outage, but either way, if this continues, or if this starts happening after every time I use my VPN, I may have to consider moving to a dumb phone...

I disagree. That's just disingenuous and kinda creepy.

I agree. I've read the TOS. It's in the TOS explaining the technically unlimited part can be slowed for overall network QOS or cancelled for abuse. American Mobile's lawyers will challenge citing their TOS, then settle for much much less with the FTC.

You can still use data, just not as quickly as before.

They were not fined for the "throttling" per se, but the (deceptive) ways how and why it was done:

From the Ars Technica article about this (»arstechnica.com/business ··· ed-data/ ):

quote:

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"In numerous instances, TracFone failed to disclose or adequately disclose its practice of enforcing fixed limits on the amount of mobile data service its customers could use in a thirty-day service period," the FTC said. "In fact, until at least September 2013, TracFone did not state in most of its advertising or terms and conditions that it would suspend or throttle its customers’ mobile data service if they used more than a fixed amount of mobile data in a thirty-day service period."

"In September 2013, TracFone began to include this information for all of its 'unlimited' offerings, but often has tucked it away in small print that is not proximate to its claims of 'unlimited' mobile data service."

The data limits "were not driven by technological constraints" and were not "a response to real-time network congestion," according to the FTC. TracFone cut its customers off from network services in order to save money.

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Throttling it a form of limiting. Not informing about it is especially deceptive.

When you say unlimited, it means what it says. You can try to argue it later after the fact that it really means 'unlimited access' or 'unlimited ability to use the service at any speed', but it's pretty clear it was meant to intentionally misleading. A 40$ million fine is nothing. If someone says unlimited, that means as much as you want.

not limited; unrestricted; unconfined: , so really, even if they do intend to throttle, that's restricted, so they weren't even following the advertising. I'm surprised they aren't being sued by end users.

There's nothing stopping you from using more data even if the speed is reduced.
--
Signed,
Devil's Advocate

Affected customers should claim their refund and then GTF away from Tracfone and not look back. Most misleading, infuriating, and inept company I've ever dealt with.

While At&t and Verizon use to offer it those two no longer offer unlimited data. T-Mobile and Sprint keep offering it while while telling you in fine print that you can get throttled in congested zones

Yeah, there needs to be a different marketing term for throttled unlimited with no overages. Sprint/Tmobile is disclosing it, the issue with TrafFone is apparently they don't disclose it 'adequately'. Even so, Sprint/TMO need to stop using 'unlimited' term. I've been using up to 60GB/month on Sprint with no signs of throttling or overcharges, but they do say they have the right to throttle.

If the congestion is 24/7 that is different from the congestion being a temporary phenomenon (ie: Not always at certain times like 7PM to 11PM). 24/7 means that they need to up the capabilities of the tower as well as up the backhaul capacity. There is only so much capacity on a tower so when too many users want to use it you will have congestion. So long as they unthrottle you once the congestion goes away that is within their terms. If you try to drive on the LIE during rush hour you will encounter congestion and not be able to drive at 55 MPH and the same thing happens with a congested tower.

How much of the fine will the customers get?

Well, at the end of the Consumerist article it says:

quote:

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The money paid by TracFone may be used to pay out settlements in private class action suits, like this one from 2013 »consumerist.com/2013/07/ ··· a-plans/ , filed over the company’s data throttling policy.

However, none of that $40 million is to be used to cover other costs related to those settlements, including attorney fees, litigation expenses, court costs, or incentive payments to class representatives.

---

I'm sure most of it will just disappear.

...it probably is.

Their "throttling" was so slow as to be a constructive termination of data service; I was throttled to less than 3 Kb/s when I was a customer of theirs, literally immediately after I crossed the 2GB threshold.

Almost every app times out and just doesn't work when the data service is THAT slow. They aren't throttling you, they're cutting you off. They claimed that since I could establish a session with their proxy server (that then immediately throttled me down to nothingness) that they hadn't "terminated" my data service.

When I bought the service it said all fees state and local plus 911 were included, then the state tacks on its own 911 fee of a flat one dollar plus taxes bringing a $14.99 fee up to $16.01, yet their service contract reads the same, their price includes all fees.

They need to throttle because of congestion but if you buy another card it restores your speed. Magic.....
I haven't had issue with the throttling but it is still a line of shit.

I think the last straw with consumers was where TF arbitrarily cancelled customer accounts (for going over data limits) putting their long held phone numbers at risk. The throttling, caps and non-disclosure is a game all the companies have done, until recently