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AT&T in talks with FTC to resolve complaint on deceptive data plans


steven36

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WASHINGTON (Reuters) - AT&T Inc (T.N) said on Thursday that it is negotiating with the U.S. Federal Trade Commission to resolve a 2014 complaint that claimed the company offered deceptive “unlimited” mobile phone data plans.

 

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“We have decided not to seek review by the Supreme Court, to focus instead on negotiating a fair resolution of the case with the Federal Trade Commission,” AT&T spokesman Mike Balmoris said. The FTC had charged that the company misled millions of consumers by charging them for unlimited data plans but reducing data speeds or “throttling” them if they reached certain data usage levels.

 

The FTC did not immediately comment.

 

A federal appeals court in San Francisco in February reinstated the FTC lawsuit, which had been thrown out after AT&T argued that it was exempt from FTC regulations and that the Federal Communications Commission had jurisdiction.

 

The Federal Communications Commission separately in June 2015 proposed a $100 million fine for AT&T for misleading millions of customers about unlimited data plans. The FCC has never moved to finalize the fine.

 

The FCC said at the time that it was the largest such fine proposal. AT&T, which said it would “vigorously dispute the FCC’s assertions,” said that the FCC had previously deemed the practice a legitimate and reasonable way to manage its network and that it had been “fully transparent with our customers, providing notice in multiple ways and going well beyond the FCC’s disclosure requirements.”

 

AT&T said it had disclosed its slowdown practices to consumers over bill statement notifications, text messages and other means.

 

In February, FCC Chairman Ajit Pai said the appeals court decision “reaffirms that the Federal Trade Commission will once again be able to police Internet service providers” after the Trump administration’s rollback of the Obama-era net neutrality rules takes effect. The 2015 net neutrality rules will expire on June 11.

 

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AT&T Ups OTT Video PR Campaign

 

As AT&T awaits a federal judge’s June 12 decision on the merits of the government’s antitrust litigation involving the telecom’s $84.5 billion acquisition of Time Warner, its executives have been busy talking to Wall Street.

 

AT&T contends the merger — which includes Warner Bros., Turner and HBO — will cut $1.5 billion in annualized operating costs between the two companies. Of course, AT&T is on the hook to Time Warner for $1 billion should the deal not be consummated.

 

On the regulatory front, AT&T CFO John Stephens May 30 told Cowen’s Technology, Media and Telecom Conference the telecom would (shockingly!) not contest an appeals court decision in February granting the Federal Trade Commission oversight on the Internet in the U.S.

 

In video, AT&T said it plans (pending the Time Warner merger) to introduce “AT&T Watch,” a $15 monthly skinny package without local programming or expensive sports. It would include Turner programming.

 

“You can serve another customer segment,” Stephens said.

 

By the end of the year, the company also expects to launch an online TV “experience” that will compete with linear TV for in-home use. The product will be app-based with a small proprietary streaming media device that connects to customers’ TVs and broadband. This service will offer the same content as linear TV with a “great user experience and lower price points.”

 

“We’ve had a period of a year-and-a-half where we’ve learned what customers want and what works on the [OTT video],” Stephens said.

 

This might seem at odds with DirecTV Now, the telecom’s much-publicized online TV service that affords users access to premium pay-TV channels starting at $35 a month – which Stephens said is increasing to $40.

 

If the merger with Time Warner is about cost synergies, why clutter the TV landscape with confusing (and competing) properties?

 

“Because we’ve been able to take a different customer segment and treat it, and be very successful at it,” Stephens said, adding that the pending OTT product would not require a service “truck roll” to the consumer’s residence or costly installation.

 

“That’s a lower subscriber acquisition cost while expanding the market,” he said.

 

The executive said advertising would play a big role in sustaining the new video properties and noted the vast ad inventory AT&T would have across its platforms following the Time Warner acquisition.

 

The CFO said AT&T will be able to offer more targeted advertising using data from its broad base of mobile and video subscribers, as well as subscribers to other properties like Otter Media, HBO and Turner Digital.

 

“You can see where you could add significant amounts of revenue to the [OTT] product, away from the customer,” Stephens said.

 

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People are worn out with monopolistic ISP's. Competition would give us choice.

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4 minutes ago, jabrwky said:

People are worn out with monopolistic ISP's. Competition would give us choice.

Amen, bother preach it , I'm so mad about it I can't . At lest in the  cities they have choice of more than one isp but in rural parts of the USA were just stuck and you're lucky to have and isp at all .

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