When 'unlimited' is limited

21 Mar 2012

AT&T last month made an $850 payout to a customer who sued it for throttling his service after his usage rose to 1.5-2GB per month even though he had an unlimited data plan.

In a policy only a telco could come up with, the US carrier throttled service when a subscriber was among the top 5% of data users that month in that area. How could customers have any idea when they where in danger of hitting that threshold?

Since that case, AT&T has "relaxed" it policy and now slows down service at 3GB (5GB for LTE plans) within a billing cycle for its 17 million legacy customers on unlimited plans. The company stopped offering real unlimited plans about a year ago.

After unsuccessfully arguing that it didn't have to guarantee the speed, just offer unlimited data usage, the operator settled when a small claims court in California ordered it to make the payment along with $85 in court fees. The Verge reported that AT&T was also unsuccessful in seeking a non-disclosure agreement, which of course could open up the floodgates for similar lawsuits from other unhappy customers with "unlimited" plans. The company plans to appeal the decision.

The dispute was taken to small claims court because AT&T customers, surprisingly, aren't allowed to file class action lawsuits or even the benefit of jury trials. This limitation was upheld just last year by the Supreme Court.

Turning our focus to Hong Kong, the territory's operators perhaps were concerned about such lawsuits when they backtracked on moving away from unlimited plans after Ofta announced new rules that required that any package marketed as “unlimited” had to be just that.

While that may seem counterintuitive since momentum had been building on dropping unlimited plans, the issue is that capped plans aren't as easy to understand as "real" unlimited deals. If "unlimited" plans are confusing and open to dispute, the move to tiered and volume-based packages, with detailed fair usage policy terms and conditions in the fine print, will certainly be more fraught with danger.

Many Hong Kong cellcos have said they need time to educate users so the can "understand their data usage behavior". That will certainly be the case since they have said that customers who exceed 5GB a month – on unlimited or volume-based plans – will be given “lower priority to access the network for the remainder of that billing period”.

That's all well and good as long as it's 100% clear to consumers when they sign the contract. But too often it still isn't.

A commenter on The Verge website summed up the feelings of many users: "The carriers need to say what they mean and mean what they say. You say I have unlimited data. Excellent, this means unlimited access to your network to do as I please. You say I have a capped plan. Excellent, I should be able to do what I want (stream, tether, etc) until I hit that limit."

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