The Federal Communications Commission (FCC) hit the telecom giant AT&T with a record $100 million fine, alleging that the multinational corporation intentionally "throttled" (slowed down) Internet speeds for customers who had signed up for "unlimited" data plans. The Internet Service Provider (ISP) was accused of decreasing data speeds to dial-up rates after customers reached an upper limit during one billing cycle.
AT&T is the second largest mobile carrier in the United States, according to The Washington Post. It ranks second to Verizon Wireless.
The FCC claims that AT&T's throttling of Internet speeds affected millions of customers. It often happened when consumers used large bandwidths for watching movies, for example.
AT&T has denied the FCC's serious allegations. A company spokesperson told ABC News that it will "vigorously dispute" them.
The spokesperson argued that the FCC has classified its practice as a legal and reasonable way to manage Internet networks. AT&T further claimed that the FCC was well aware for years that major telecom carriers have used the practice.
The broadband provider also said that it provides full transparency for its customers. It goes "well beyond" FCC requirements.
Meanwhile, FCC Chairman Tom Wheeler argued that consumers must receive the various services they have paid for, according to ABC News. He implied that AT&T has used "misleading marketing."
AT&T said that the FCC knew of a particular company policy regarding network management .It involved providing more bandwidth to users with less network usage during a certain previous period.
If the FCC fine stands regarding the AT&T unlimited data plan, the collected funds will likely go entirely to the U.S. Treasury.