Verizon Hangs Up On Tens Of Thousands Of 'Unlimited' Wireless Customers For Using Too Much Data

from the invisible-barriers dept

Over the last few years, you may have noticed that Verizon is attempting a pivot from stodgy old telco to sexy new advertising juggernaut. Part of that effort has involved refusing to upgrade its lagging DSL infrastructure in countless towns and cities as it shifts its focus toward wireless and using its AOL and Yahoo acquisitions to sling videos and advertisements at Millennials. To justify its failure to upgrade its fixed-line network during this period (something it's being sued for by cities like New York), Verizon has long proclaimed that wireless is a "good enough" replacement for fixed-line alternatives.

But the company is now inadvertently highlighting just how not-ready for prime time wireless connections truly are. Verizon has been taking heat over the last few weeks for kicking thousands of customers off of its wireless network in more rural areas. Why? The company insists these customers (at last count 8,500 customers utilizing 19,000 lines across 13 states) are being kicked off the Verizon wireless network for using a "substantial" amount of data. But Verizon is refusing to tell these users what "substantial" actually means, after marketing "unlimited" data plans to these users for much of the year:

Verizon said in June that it was only disconnecting "a small group of customers" who were "using vast amounts of data—some as much as a terabyte or more a month—outside of our network footprint." But one customer, who contacted Ars this week about being disconnected, said her family never used more than 50GB of data across four lines despite having an "unlimited" data plan.

"Now we are left with very few choices, none of them with good service," the customer told us. "I guess small-town America means nothing to these people. It's OK—though I live in a small town, I know a lot of people, and I'm telling every one of them to steer clear of Verizon."

The problems here are multi-faceted. Three years ago, Verizon Wireless launched something called its LTE in rural America program (LTEiRA). Under this program, Verizon partnered with rural carriers to help extend the reach of their networks by letting them lease access to Verizon’s 700MHz Upper C Block spectrum. Several of the companies that worked with Verizon on this program state the company hyped the program, hired companies to help extend the reach of rural networks, then began marketing unlimited data plans to customers in many of these rural areas.

But when the program wasn't as profitable as Verizon hoped, it abruptly pulled the plug, leaving thousands in connectivity purgatory:

“It appears that Verizon induced these companies to build out in the rural areas around the country and then significantly promoted it by saying that they’re covering the rural areas, when it fact now, after putting those ads out, they’re now not covering the rural areas — in fact, they’re cutting it back,” he says.

And without much advance notice.

“This move caught them completely by surprise and totally blindsided them as it did the customers in the region,” says Jason Sulham, speaking for Wireless Partners LLC."

Again, Verizon isn't bothering to inform these users what "substantial" usage even means, part and parcel of a sector that has long advertised wireless connections as "unlimited," then saddled users with all manner of murky restrictions (part of the reason we have net neutrality rules). Some of the impacted users are telling news outlets they used as little as three gigabytes per month, so there's every indication that Verizon Wireless isn't being honest here as it tries to portray many of these folks as unreasonable data gluttons (which is traditionally par for the course).

In this case, Verizon's decision to kick thousands of people off of the network is also having a dramatic impact on first responders in many of these rural areas, who say their ability to protect the public has been compromised:

"Law enforcement agencies in eastern Maine are criticizing a decision by Verizon Wireless to terminate cell service due to excessive cost. Police say the company’s decision will have an adverse effect on their work, and on the ability of residents to call 911.

Verizon officials remained tight-lipped Wednesday regarding the actual number of dropped customers, which some sources say could be as high as 2,000."

Again, there's nothing particularly revelatory about the fact that delivering wireless broadband to rural markets is expensive. Wireless spectrum is costly (often impossible for smaller companies), as is access to the fiber backhaul needed to feed wireless towers. But Verizon has spent the last decade insisting that freezing its deployment of FiOS fiber connections wasn't a big deal because wireless would be "good enough" for the millions of subscribers left in a lurch. In fact, Verizon found itself repeatedly under fire after Hurricane Sandy for refusing to repair fixed line networks for just that reason.

Verizon's decision to purge thousands of users off of the network for murky reasons comes as the FCC is looking -- largely at Verizon and AT&T's behest -- to weaken the standard definition of broadband to include wireless. The goal: redefine broadband to declare an area competitive and served if wireless is present, justifying institutional apathy toward doing anything about the lack of competition in the space. Granted this effort ignores instances exactly like this one clearly demonstrating that -- even with 5G on the horizon -- wireless is not a magical broadband panacea for under-served areas.

Filed Under: data, unlimited, unlimited data, wireless
Companies: verizon

Unlimited Data Customers Report Fewer Network Problems Than Capped Users

from the unshackle-me,-please dept

Back in 2011, you might recall that AT&T and Verizon stopped offering users unlimited wireless data plans. Taking advantage of a lack of competition at the time, the duo worked in concert to shove users toward confusing, metered plans that imposed a usage cap, then socked users with overage fees upward of $15 per gigabyte. When users refused to migrate to these plans, both companies spent years making life as difficult as possible for these subscribers, AT&T going so far as to block users from accessing Facetime until they switched to these more expensive, metered plans (but who needs net neutrality rules, right?).

All the while, both companies repeatedly insisted that nobody actually wanted simpler, unlimited plans. That was until increased competition from T-Mobile (thanks in large part to regulators blocking AT&T's attempted acquisition of the company) forced both companies to bring back their unlimited data plans. And while Wall Street has been whining for months that competition is preventing these companies from nickel and diming their customers, consumers generally like the return to unlimited data.

Case in point: a new study by JD Power and Associates indicates that unlimited data customers are consistently more impressed with the performance of their connections than their capped and metered counterparts. More specifically, users on unlimited data plans state that they experience fewer network problems of all kinds than metered users:

Unlimited data emerges as great equalizer for wireless network quality: Customers with unlimited data plans experience an average of 11 overall network quality problems per 100 (PP100) connections vs. an average of 13 PP100 among customers with data allowances. They also have lower incidences of data problems (15 PP100 vs. 16PP100, respectively); messaging problems (5 PP100 vs. 6 PP100); and calling problems (12 PP100 vs. 15 PP100). This trend holds true among both power users (100 or more network connections in the previous 48 hours) and lighter users (fewer than 100 network connections in the previous 48 hours).

That said, the study does proceed to note that this may be based, in part, on the "perception" by consumers that they have a better connection, not necessarily that the network is performing better. In other words, customer perception of a network's performance may be shaded by the fact they don't have to constantly worry about whether they're about to go over their usage restrictions:

“Whether a customer has unlimited data or a data allowance on their wireless plan should not really affect their overall network quality, but our data shows that—consistently—wireless customers who are not worried about data overages have a much more positive perception of their network’s quality,” said Peter Cunningham, technology, media, and telecommunications practice lead at J.D. Power. “This is a critical insight into wireless customer psychology for carriers who’ve been engaged in battle over unlimited data plans for the past several months.”

The meters used by fixed and mobile customers are notoriously unreliable, one study claiming carriers routinely over-bill consumer mobile data usage by between five and seven percent. Despite this, there's nary an effort from any regulator here in the States to ensure that usage is being metered accurately, and that's certainly not changing with the current FCC. And while it's nice to see competition forcing these carriers to actually listen to subscribers, a wave of merger mania in the sector means that this competition -- and the unlimited data resurgence it spawned -- may not be sticking around for long.

Filed Under: customer satisfaction, customer service, data caps, unlimited data

FCC Boss Falsely Claims His Attacks On Net Neutrality Have Already Made The Wireless Sector More Competitive

from the up-is-down-black-is-white dept

Last week we watched as Verizon, a company that spent years telling users they didn't want or need unlimited data, was forced to bring back unlimited data. AT&T quickly followed suit with similar plans of its own, despite having spent years waging a not so subtle war on grandfathered unlimited connection customers. The reason for this sudden collective about-face? The continued rise of T-Mobile, which has increasingly brought something vaguely resembling competition to the wireless sector (even if non-price, often superficial competition remains the predominant law of the land).

While this was happening, we've been noting how new FCC boss Ajit Pai has been taking an axe to consumer protections, moving to gut broadband privacy rules, making it easier for prison telco monopolies to rip off inmate families, and killing efforts to bring competition to the cable box. Pai also recently killed off the FCC's inquiry into zero rating, after the former FCC stated Verizon and AT&T were using usage caps to give their own content an unfair market advantage.

If you ask industry lobbyists, this behavior makes Pai an incredible consumer champion. Apparently that narrative is very much alive in Pai's head as well. In a speech this week at the Mobile World Congress in Barcelona, Pai was quick to proclaim that he's simply returning to an era of "light-touch" regulation of telecom, one that will result in massive, unspecified benefits to all:

"We are confident in the decades-long, cross-party consensus on light-touch Internet regulation—one that helped America’s digital economy thrive. And we are on track to returning to that successful approach.

In telecom, "light-touch regulation" is code for letting AT&T, Verizon, Comcast and Charter do whatever the hell they'd like. The narrative usually goes something like this: if you free giant ISPs from the burdens of "onerous federal regulation" (like net neutrality), Utopia magically springs from the sidewalks. But as we saw during Michael Powell's tenure, this narrative is flimsy, and the blind federal deregulation of telecom only makes things worse. Why? When you let revolving door regulators like Pai and Powell run the show, their breathless dedication to industry means they intentionally overlook the lack of competition in the sector.

Eliminate functional regulatory oversight and refuse to address limited competition? The end result is... Comcast Corporation and its record-shatteringly-bad customer service, high prices, and usage caps.

But Pai took things further in his speech, actually claiming that his refusal to enforce the agency's net neutrality rules somehow resulted in a flurry of competition and a return to unlimited data:

"Earlier this month, for example, we ended the FCC’s investigation into so-called “zero-rating,” or free-data offerings. Free-data plans have proven to be popular among consumers, particularly those with low incomes, because they allow consumers to enjoy content without data limits or charges. They have also enhanced competition. Nonetheless, the FCC had put these plans under the regulatory microscope. It claimed that they were anticompetitive, would lead to the end of unlimited data plans, or otherwise limit online access. But the truth is that consumers like getting something for free, and they want their providers to compete by introducing innovative offerings. Our recent decision simply respected consumers’ preference.

The best evidence of the wisdom of our new approach is what happened afterward. In the days following our decision, all four national wireless providers in the United States announced new unlimited data plans or expanded their existing ones. Consumers are now benefiting from these offers—offers made possible by a competitive marketplace. And remember: Preemptive government regulation did not produce that result. The free market did.

That's an incredible load of nonsense. T-Mobile only still exists because federal regulators blocked AT&T from acquiring it. So in reality, it was government intervention that allowed T-Mobile to continue to exist, with the resulting competition driving AT&T and Verizon to adopt all manner of more consumer-friendly positions. It's hard work, but one needs to weigh each instance of government regulation on its merits. Insisting all regulation is good or bad is just lazy thinking, and the idea that gutting all consumer protections magically results in the telecom equivalent of Smurf village is utterly nonsensical given the industry's history.

We've also noted how zero rating has nothing to do with giving consumers "free data," though carriers have certainly conditioned consumers to think as much. Usage caps are entirely arbitrary, and are completely untethered to real-world network congestion or financial necessity. Caps and overage fees are simply glorified price hikes, and they exist as a symptom of limited competition. As competition increased, it became untenable for AT&T and Verizon to continue ignoring consumer demands, especially once T-Mobile began adding significantly more mobile subscribers than any other carrier every quarter.

The irony, of course, is that Pai was in favor of the AT&T and T-Mobile merger, which would have killed off T-Mobile's disruption entirely. He's also never seen an incumbent ISP policy idea he didn't like, and his voting history suggests he'll happily vote to approve what many expect is a looming Sprint acquisition of T-Mobile. When the resulting diminished competition from that deal results in higher prices, what's the over/under on Pai blaming himself or his love of a "light touch?"

Filed Under: ajit pai, data caps, fcc, net neutrality, unlimited data, zero rating

Verizon Cracks Down On Unlimited Data Users, Claims Nobody Wants Unlimited Data Anyway

from the tell-us-what-we-want dept

"Because our network is a shared resource and we need to ensure all customers have a great mobile experience with Verizon, we are notifying a small group of customers on unlimited plans who use more than 200GB a month that they must move to a Verizon Plan by February 16, 2017," Verizon spokesperson Kelly Crummey told Ars today."

"So, while unlimited data may sound attractive, there is no practical effect of data limits on the majority of users. Understanding this should bring rationality to a discussion that is often held on a “gut feeling” level. Keeping adequate speed and performance while allowing all users to share the limited commodity we call wireless data is the fair way to deal with wireless connectivity. And ultimately, that is what is beneficial for wireless consumers."

Filed Under: data caps, grandfathering, unlimited data
Companies: verizon

FCC Fines T-Mobile For Abusing The Definition Of 'Unlimited' Data

from the abusing-the-dictionary dept

"The FCC’s investigation found that company policy allows it to slow down data speeds when T-Mobile or MetroPCS customers on so-called “unlimited” plans exceed a monthly data threshold. 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 Commission’s 2010 Open Internet transparency rules require broadband Internet providers to give accurate and sufficient information to consumers about their Internet services so consumers can make informed choices."

"Consumers should not have to guess whether so-called ‘unlimited’ data plans contain key restrictions, like speed constraints, data caps, and other material limitations,” said FCC Enforcement Bureau Chief Travis LeBlanc. “When broadband providers are accurate, honest and upfront in their ads and disclosures, consumers aren’t surprised and they get what they’ve paid for. With today’s settlement, T-Mobile has stepped up to the plate to ensure that its customers have the full information they need to decide whether ‘unlimited’ data plans are right for them."

Filed Under: fcc, lies, throttling, unlimited data
Companies: t-mobile