The US Federal Communications Commission (FCC) has proposed fining AT&T $100m for deliberately interfering with internet connections and misleading customers about discrepancies between advertised and actual speeds.
AT&T was accused in an FCC Notice of Apparent Liability (PDF) of offering unlimited services while capping them at the same time in violation of the 2010 Open Internet Transparency Rules.
"Consumers deserve to get what they pay for. Broadband providers must be upfront and transparent about the services they provide," said FCC chairman Tom Wheeler.
"The FCC will not stand idly by while consumers are deceived by misleading marketing materials and insufficient disclosure."
V3 asked AT&T for its response to the criticisms and the fine. The company said that it has already attempted to address the problems with the FCC and filed documents contradicting the watchdog's claims earlier this year.
"We will vigorously dispute the FCC's assertions. The FCC has specifically identified this practice as a legitimate and reasonable way to manage network resources for the benefit of all customers, and has known for years that all of the major carriers use it," AT&T said in a statement.
"We have been fully transparent with our customers, providing notice in multiple ways and going well beyond the FCC's disclosure requirements."
The FCC said that, if an internet service is advertised as unlimited it should be exactly that. The watchdog has had thousands of complaints from AT&T customers about the situation over the past four years.
"Unlimited means unlimited," said FCC Enforcement Bureau chief Travis LeBlanc. "As today's action demonstrates, the FCC is committed to holding accountable those broadband providers who fail to be fully transparent about data limits."
The FCC is firmly behind openness and fairness on the internet, or net neutrality, and welcomed a court decision earlier this month that enshrined such rights for US citizens.
"This is a huge victory for internet consumers and innovators. Starting Friday, there will be a referee on the field to keep the internet fast, fair and open," said Wheeler at the time.
"Blocking, throttling, pay-for-priority fast lanes and other efforts to come between consumers and the internet are now things of the past. The rules also give broadband providers the certainty and economic incentive to build fast and competitive broadband networks."
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