FCC Fines AT&T $100 Million over Unlimited Plan Abuse
I just find this funny. Probably not the response the FCC was hoping for. But this is laughable for so many reasons. Made even funnier by AT&T's response.
Firstly, the claim is that ATT didn't properly notify it's customers about a silent bandwidth cap that effectively renders your data plan useless once you hit it. ATT, predictably, argues that they make this information available in a wide array of places. Of note, they never included their marketing materials or their retail locations amongst those places.
I don't find it funny because I think that the FCC is wrong by the way. I'm not an American citizen so I don't really know what ATT was like when these plans were available, but I suspect that the plans were largely marketed as being truly unlimited and very little was actually done to make their customers aware. Heck, they may have even had their sales reps avoid talking about the limits or make some questionable claims. All very believable and likely.
On the flipside... the suit alleges that millions of their customers were completely unaware. This I also doubt. I'll guarantee some were unaware. But lets face it, for almost as long as there has been unlimited internet plans on anything, there has been throttling. And by and large the public is aware of this. Most people I know are immediately skeptical about the claim that anything is unlimited. And that leads me to believe that the number of people who legitimately had the wool pulled over their eyes is much smaller than the suit claims.
But where this gets really funny is the amount. $100 million. I hear someone saying that in the Dr. Evil voice. But lets break it down. If millions of people were affected, this lawsuit amounts at most to $100 per person screwed over (assuming that the millions mentioned is just 1 million), or, more likely even less. And the people screwed over don't see a cent of it. This lawsuit does nothing. It doesn't help those who were cheated and in terms of punitive damages, that amounts to something as pathetic as a month or less of fees charged per person who the FCC felt was cheated. That isn't enough in damages to do a damn thing.
And, of course, ATT is going to fight it. They'll probably lose. Apparently the FCC used similar justification in a similar case recently and won. But, there is a chance ATT will win. And if they lose... they won't care. They probably don't WANT to lose $100 million, but all in all, that is getting off fairly easily.
I don't think, in this case, that FTC understands what punitive damages are meant to do. The value should be large enough to harm the business without destroying it. In other words, a large enough fine that the company is HIGHLY dis-incentivized from doing it again. This price for screwing over "millions" isn't even a slap on the wrist. ATT would likely have paid more in phone subsidies for those "millions" than this will cost them. And for a company this size which can afford a lawsuit, the amount is so small that they have no reason not to fight it. If they win by some miracle it will just open them up to do it again more freely. If they lose, they've learned how much this tactic costs and probably won't view it as a big enough deterrent to keep them from doing something similar down the road.
Firstly, the claim is that ATT didn't properly notify it's customers about a silent bandwidth cap that effectively renders your data plan useless once you hit it. ATT, predictably, argues that they make this information available in a wide array of places. Of note, they never included their marketing materials or their retail locations amongst those places.
I don't find it funny because I think that the FCC is wrong by the way. I'm not an American citizen so I don't really know what ATT was like when these plans were available, but I suspect that the plans were largely marketed as being truly unlimited and very little was actually done to make their customers aware. Heck, they may have even had their sales reps avoid talking about the limits or make some questionable claims. All very believable and likely.
On the flipside... the suit alleges that millions of their customers were completely unaware. This I also doubt. I'll guarantee some were unaware. But lets face it, for almost as long as there has been unlimited internet plans on anything, there has been throttling. And by and large the public is aware of this. Most people I know are immediately skeptical about the claim that anything is unlimited. And that leads me to believe that the number of people who legitimately had the wool pulled over their eyes is much smaller than the suit claims.
But where this gets really funny is the amount. $100 million. I hear someone saying that in the Dr. Evil voice. But lets break it down. If millions of people were affected, this lawsuit amounts at most to $100 per person screwed over (assuming that the millions mentioned is just 1 million), or, more likely even less. And the people screwed over don't see a cent of it. This lawsuit does nothing. It doesn't help those who were cheated and in terms of punitive damages, that amounts to something as pathetic as a month or less of fees charged per person who the FCC felt was cheated. That isn't enough in damages to do a damn thing.
And, of course, ATT is going to fight it. They'll probably lose. Apparently the FCC used similar justification in a similar case recently and won. But, there is a chance ATT will win. And if they lose... they won't care. They probably don't WANT to lose $100 million, but all in all, that is getting off fairly easily.
I don't think, in this case, that FTC understands what punitive damages are meant to do. The value should be large enough to harm the business without destroying it. In other words, a large enough fine that the company is HIGHLY dis-incentivized from doing it again. This price for screwing over "millions" isn't even a slap on the wrist. ATT would likely have paid more in phone subsidies for those "millions" than this will cost them. And for a company this size which can afford a lawsuit, the amount is so small that they have no reason not to fight it. If they win by some miracle it will just open them up to do it again more freely. If they lose, they've learned how much this tactic costs and probably won't view it as a big enough deterrent to keep them from doing something similar down the road.
Comments
Post a Comment