Regulators Target Carrier Data Throttling

FCC complaint against AT&T for alleged data throttling illustrates growing tension between regulators and carriers over ISP network management practices.

Pablo Valerio

November 4, 2014

4 Min Read
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All Internet service providers use some form of throttling, especially when they face unusual network traffic. Most of the time, it's used for quality purposes to ensure that all users have reasonable service and critical applications have enough bandwidth.

But with the massive adoption of data-hungry mobile devices, most wireless carriers are dealing with a surge of data consumption for which their networks are not prepared. Customers are now faced with carriers deliberately throttling their connections to penalize the amount of data consumed. Carriers call these policies necessary service and network management, but regulators are scrutinizing them.

The Federal Communications Commission recently filed a federal court complaint against AT&T for charging millions of customers for unlimited data plans and then restricting speeds.The reason the FCC took action is because AT&T failed to inform users that they might experience slow speeds after consuming a certain amount of data in their so-called “unlimited” plans.

Apparently AT&T is reducing the speed of those users up to 90% after they have consumed 2 gigabytes of data in a monthly cycle. The FCC claims that about 3.5 million consumers have been affected.

Many cellular operators offer limited data packages with additional charges or reduced speeds for extra data consumption, but AT&T is offering “unlimited” data, without explicitly telling users that speeds will be reduced after a certain data threshold is reached.

“AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” said FTC chairwoman Edith Ramirez. “The issue here is simple: ‘unlimited’ means unlimited.”

This type of speed throttling is not aimed at ensuring equal quality of service for customers, but to penalize heavy users and make them drop their unlimited plans.

Another tactic carriers are using is blocking the possibility of sharing Internet connections of smartphones with other devices, commonly known as “tethering.” Some carriers offering high-speed HSDPA+ and 4G LTE connections are trying to block the practice. The FCC found Verizon had pressured Google to remove 11 apps from its app store that allowed customers to use their smartphones to create mobile WiFi hotspots.

After the FCC complained and declared the practice of blocking tethering illegal, a settlement was reached in which Verizon agreed to pay a $1.25 million fine and stop trying to block users from sharing their Internet connections.

Verizon also had plans to begin throttling 4G users in October, but the operator said in a statement that it "decided not to move forward with the planned implementation of network optimization for 4G LTE customers on unlimited plans.”

European regulators also have been questioning ISP and carrier "traffic management" practices. Two years ago, the European Commission started a process to ask industry players about the reasons for network service management and how it affects customer experience. Obviously, the ISPs and cellular carriers fiercely defended their traffic management practices, insisting that they were absolutely necessary to ensure the quality of service.

UK carrier EverythingEverywhere (EE) claimed that traffic management targets heavy users whose use is excessive to the extent that it has an impact on other users. "EE considers that this is a necessary approach in order to ensure that the best possible experience is maintained for the majority of users of network. Provided that this is coupled with transparency measures as to the implications of excessive use (such as those already in place in the UK), this should be a workable approach," the company said in its response to the EU's inquiry.

Unfortunately, throttling and blocking tethering aren't the only problems. In order to perform “network optimization,” some ISPs are not only looking at the amount of data and speeds of their customers, but at the types of services and applications are they using.

The technology is called deep packet inspection (DPI), and carriers justify it because some users are running applications such as P2P and VoIP using different ports than the ones normally assigned for those services. The problem with DPI is that it gives the ISPs and mobile carriers not only information about the application, but also about the content.

We now have essentially an open war among carriers, regulators, and consumers about the way wireless data can be sold and used. While it is understandable that carriers need some forms of traffic management, they also need to be transparent when selling their data plans to users. Also, penalizing paying users for making the best use of their data plans should not be tolerated.

About the Author(s)

Pablo Valerio

International Business & IT ConsultantPablo Valerio has been in the IT industry for 25+ years, mostly working for American companies in Europe. Over the years he has developed channels, established operations, and served as European general manager for several companies. While primarily based in Spain, he has also lived in Germany, The Netherlands and Denmark. His knowledge of the European IT business and his interest in EU technology initiatives spurred his move to technology writing. For the past four years, he has been a regular contributor to several publications in the IT ecosystem, focusing on privacy, security, mobile technology and smart cities. His work has appeared in InformationWeek, EETimes, Enterprise Efficiency, UBM Future CitiesDell's Tech Page One, and SAP Business Innovation, among others.

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