FCC Reaches Settlement With T-Mobile Over Unlimited Plans

The Federal Communications Commission said Wednesday it reached settlement with T-Mobile US Inc. valued at $48 million for failing to adequately inform consumers of wireless data restrictions on plans it called "unlimited."

The FCC said the carrier applied slower data speeds and throttled customer traffic once certain usage threshold were hit without telling its customers.

"Company advertisements and other disclosures may have led unlimited data plan customers to expect that they were buying better and faster service than what they received," the agency said in a statement.

Under the settlement, T-Mobile will pay $7.5 million in cash along with $35.5 million in "consumer benefits" in the form of discounts and additional data to unlimited customers of both T-Mobile and its prepaid brand MetroPCS. The company also agreed to provide at least $5 million in services and equipment to schools.

The Twitter account of T-Mobile CEO John Legere called the consent decree a "good settlement with FCC" and that the carrier "believes more info is best for customers."

Last year, the FCC sought to fine AT&T Inc. $100 million in a similar case, but the company is contesting the proposed penalty. In August, a federal appeals court threw out a government lawsuit against AT&T that alleged the company misled wireless subscribers by selling them unlimited data plans and then quietly slowing down service if they consumed high amounts of data.

Write to Thomas Gryta at thomas.gryta@wsj.com

(END) Dow Jones Newswires

October 19, 2016 11:55 ET (15:55 GMT)

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