FCC Fines AT&T $100 Million Over Data Speeds

The FCC levied a $100 million fine against AT&T, saying the company misled consumers over wireless data speeds.

Last year the Federal Trade Commission sued telecom giant AT&T over data throttling. According to, 3.5 million AT&T customers were affected. Now, the Federal Communications Commission is fining AT&T $100 million based on allegations that it is misleading its customers about data slowdowns. AT&T implemented a speed cap on users’ data, which, the FCC says, slowed it for as many as 12 days each month. AT&T disputes the FCC’s allegations. An important related question: How much data do you actually need?

TIME Companies

FCC Just Slammed AT&T With a $100 Million Fine

The phone carrier is being punished for slowing down "unlimited data plans"

The Federal Communications Commission announced on Wednesday it will impose a whopping $100 million fine on AT&T to punish the phone carrier for severely slowing down the data speeds of customers who have “unlimited data plans.”

According to the FCC, it received thousands of complaints over AT&T’s slow mobile internet, and that the carrier failed to notify subscribers it was providing slower-than-advertised speeds.

“The Enforcement Bureau’s investigation revealed that millions of AT&T customers were affected. The customers who were subject to speed reductions were slowed for an average of 12 days per billing cycle, significantly impeding their ability to use common data applications such as GPS mapping or streaming video,” said the FCC in a news release.

AT&T said in a statement that it will fight the fine and that it “vigorously disputes the FCC’s assertions.”

The FCC investigation relates to “unlimited” data plans that AT&T first began to offer in 2007, and has since discontinued. Customers who signed up for the plan, however, complained that AT&T began imposing a cap in 2011, and then severely slowing down speeds when they exceeded that cap. Many also expressed frustration about being locked into long-term “unlimited” contracts despite the caps, and being forced to pay termination fees if they wanted to change plans.

“Unlimited means unlimited,” said FCC Enforcement Bureau Chief Travis LeBlanc. “As today’s action demonstrates, the Commission is committed to holding accountable those broadband providers who fail to be fully transparent about data limits.”

The FCC’s announcement comes after another agency, the Federal Trade Commission, already filed a lawsuit against the phone giant over the same issue. That lawsuit seeks refunds for consumers, and is going forward after a judge in April ruled that the FTC had jurisdiction to sue phone phone carrier.

The other big phone carriers – Verizon, Sprint and T-Mobile – have also engaged in throttling, but have done so less systemically, and in order to ease network congestion.

This story was updated several times

This article originally appeared on

TIME mergers & acquisitions

Here’s Why Merger Approvals Are Getting So Slow

It's not just your imagination

As the number of mergers and acquisitions has rapidly increased in the past few years since the 2007-08 financial crisis, government watchdog agencies have been slower at approving them, The Wall Street Journal reports.

The Justice Department and the Federal Trade Commission are using more time to investigate mergers, the newspaper reported, citing data from antitrust lawyer Paul Denis of Dechert LLP. Denis’ data show recent merger reviews are taking 10 months on average versus seven months in previous years.

The Journal noted a few reasons why recent mergers have been held in regulatory limbo:

External factors explain the length of some antitrust probes. Telecom mergers, such as the Comcast and AT&T deals, require an added layer of FCC review. And deals with a strong international component can take longer as firms coordinate with antitrust agencies overseas.

Some atypically long processes could be affecting Denis’ data. Comcast waited 14 months to hear about its bid for Time Warner Cable before ultimately dropping the plan in the face of regulatory pressure. Meanwhile, a review of AT&T’s attempt to acquire DirecTV has been in the works for more than a year.

TIME deals

T-Mobile and Dish Network Are Nearing a Merger, According to Reports

Purchase price and stock options have not been agreed upon

Dish Network and T-Mobile are close to a merger agreement that would mark another instance of recent consolidation deals amongst U.S. communications companies as traditional media grapples with changing business dynamics in the Internet era, reported the Wall Street Journal on Wednesday.

According to the Journal, semantics over the end price and cash versus stocks considerations have not been agreed upon.

The deal comes on the heels of a pair of major agreements—the $49 billion deal between AT&T and DirectTV, and a $67 billion agreement between Charter Communications, Time Warner Cable and Bright House Networks.

Read more details about the merger at the Wall Street Journal.


AT&T Knows the Days of 2-Year Contracts Are Numbered

Richard Drew—AP

Consumers have better options.

The days of consumers being locked into two-year wireless contracts are numbered. We’ve known this for a while, what with the rise of prepaid and no-contract plans that charge no fees when a customer cancels the service. Why worry about having to pay an early termination fee of $100 to $350 for dumping a locked-in contract when there are other, less onerous plans with service that’s just as good?

This week AT&T, a pioneer in locked-in wireless plans, took a big step toward their extinction. On Monday, the wireless giant eliminated two-year contracts through partner retailers Apple and Best Buy. “I think it is one of those options that is going to go away slowly,” Ralph de la Vega, AT&T CEO of mobile and business solutions, explained to Re/code. The policy change is coming “not because we insist on it but because customers will choose it less often.”

The disappearance of two-year contracts and their outsized early termination fees is great for consumers. But the traditional tradeoff for being locked into a two-year contract—cheaper, subsidized prices for smartphones—is disappearing as well. Some consumers probably think of this as a negative, but in reality it is not.

When you run the numbers, it becomes apparent that a subsidized cellphone with a contract costs more in the long run compared to pretty much any other option out there today. Sure, the subsidized option initially costs less out-of-pocket. But the tradeoff for that cheaper upfront price is higher monthly bills. Virtually every analysis comparing contract vs. non-contract plans points out that when you look at total costs over two years or more, it almost always makes financial sense to skip the contract.

So feel free to rejoice that the era of two-year contracts is coming to an end.

MONEY cellphones

3 Promotions That Show Sprint Is Desperate for Your Business

Sprint store sign
Andrew Harrer—Bloomberg via Getty Images

Sprint is offering crazy-sounding deals right now, including hand delivery of new phones. But that doesn't mean the wireless provider offers good value.

Sprint just announced that it will hand deliver new phones to customers’ homes and then help them set up the devices. The new promotion is set to start in Kansas City (near Sprint’s Overland Park headquarters) before rolling out to Miami, Chicago, and the rest of the United States.

Yet for anyone paying attention to the industry, the promo reads more as an act of desperation than a great deal. Though Sprint has been holding on to about 16% market share for the last few years—about the same as T-Mobile, and half as much as top-two carriers Verizon and AT&T—it has poor customer satisfaction rates and an especially high “churn” rate, or percentage of customers who dump their provider each quarter.

To be fair, the “D” word gets thrown around a lot when cellphones are being discussed. Last year, T-Mobile CEO John Legere accused AT&T of being “desperate” by offering a $450 buyout plan for customers who jumped ship from rival carriers. Then, days later, T-Mobile upped the desperation ante by offering its own $650 buyout plan—and AT&T quickly (and quietly) ended its offer. And it’s not just wireless carriers: Reviewers of HTC’s new “Uh-oh protection” program have called the deal desperate, since it offers a free replacement if you break your phone within the first year. Even iPhone users with AppleCare+ don’t get totally free phone replacements.

But Sprint in particular has garnered much attention over the years for especially desperate-sounding promotions. Here are 3 signs the company really, really wants your love.

1. Sprint will meet you at Starbucks, the gym, or wherever

The company’s new hand-delivery promotion offers a time-window precision that might make even Amazon Prime customers jealous.

“We will deliver pretty much anywhere… and it’s an exact-on-time delivery,” Sprint vice president Rod Millar told The Verge. “You can tell us ‘6:45, and meet me at McDonald’s.'”

Sounds convenient, but also potentially awkward—particularly for the Sprint “expert” who gets to roll up in this extremely cool-looking car and wait for you to finish ordering your fries.

2. Sprint will cut your AT&T or Verizon bill in half

This past December, Sprint announced it will now give you a 50% discount off whatever monthly fee you were paying AT&T or Verizon if you cancel your plan and switch.

Of course, the company also uses the promotion to get you locked into one of its various device programs. Those include the “iPhone for Life Plan,” which is not so much a chance for you to get a free new iPhone every few years (like it sounds) as it is a lease program in which you pay a monthly fee on top of your service charges—and do not technically own the phone.

3. Sprint will give you $550 to ditch T-Mobile

If you trade in your T-Mobile phone, you get $200 upfront from Sprint, plus up to $350 per line for dropping your T-Mobile contract.

Given that Sprint is in serious danger these days of slipping behind T-Mobile in the cellphone wars, this promotion makes sense. In 2014 alone, the company bought back more than 3 million phones from rival carriers.

Then again, if it wants to earn back market share, the service provider might want to focus less on promotions and more on, well, service. Sprint’s poor coverage kept it off of MONEY’s Best Cellphone Plans list last year, and despite some improvements, the company still ranks below its peers according the most recent report by RootMetrics, a company that rates mobile plans.

TIME Smartphones

The 13 Best Free Smartphones You Can Buy

Motorola Mobility Portfolio Launch Event
Daniel Boczarski—2014 Getty Images Motorola announced the new Moto X and G, Moto Hint and Moto 360 by opening its headquarters for media to meet the engineers and designers committed to offering people more choice, control and accessibility in their personal technology.

$0 down can actually go a long way

Walk into any AT&T or Verizon store, and you’ll see a shelf full of $0 phones, complete with cheap knock-offs, devices that can’t connect to the Internet, and old handsets from 2012. Make no mistake: when it comes to free phones, you usually get what you pay for.

Here and there, however, you can find a great phone for $0 down. Some companies will offer discounts on devices in a less popular size, while others will drop prices significantly a year after release. Even some of the best flagship models from top brands—like Apple, Samsung, HTC and LG—will eventually drop their prices to $0, as long as you know where and when to look.

With this in mind, we set out to find the best free phones on the market today. Each of the devices on this list will cost you $0 from at least one carrier, as long as you’re starting a new contract.

How did we pick and rank the list? We started with a list of phones that can be purchased for $0 with a new contract. We then looked at specs, features and expert reviews to calculate a Smart Rating for each device. Finally, we ranked our list by the overall ratings, using release date to break ties (the newer the device, the better).

We’ll start with number 13 and work our way to the best free phone of all.

LG Enact

Smart Rating: 79/100
Release: August 2013

For customers who miss physical keyboards, the LG Enact hides a full QWERTY set-up right underneath its full 4-inch display. It’s the sort of design you’d have to pay half a grand for in 2007. Today? You can snap one up for $0 with a contract.

Samsung Galaxy S4 Mini

Smart Rating: 84/100
Release: May 2013

Samsung fans hoping to save should give a hard look at the $0 Galaxy S4 Mini, a phone with signature Samsung quality, but costing hundreds of dollars less than the newest models.

Motorola Moto G

Smart Rating: 84/100
Release: November 2013

Praised for its pure Android experience (no needless frills or odd augmentations), the 2013 Moto G remains a smart, sensible buy for people who live on Google services like Gmail, YouTube and Maps.

BlackBerry Z10

Smart Rating: 88/100
Release: January 2013

The Z10 was BlackBerry’s best attempt to produce a modern-style smartphone—complete with the familiar grid of app icons and no physical keyboard. To this day, it’s still a great option for BlackBerry fans who like the way iOS looks but don’t care for Apple’s ecosystem. And best yet, it doesn’t cost a penny.

Motorola DROID Mini

Smart Rating: 89/100
Release: August 2013

Generally speaking, bigger phones tend to have larger—and thus longer lasting—batteries. Take the iPhone 6 versus the 6 Plus: the 5.5-inch Plus boasts over 70% more battery than its smaller cousin. The $0 DROID Mini defies this trend—a 4.3-inch phone with a whopping 28 hours of battery. It’s a rare combination at an unbeatable price.

LG Lucid 3

Smart Rating: 89/100
Release: April 2014

The LG Lucid 3 was made specifically for the tasteful budget phone shopper—someone who wants smooth operation and clean hardware design for next to no cost. The device is also a nice, compact alternative to LG’s parade of big-screen, 5.2- to 6-inch phones.


Smart Rating: 90/100
Release: August 2013

The Motorola DROID MAXX still offers one of the best batteries on the market, capable of going two full days on a single charge. Sure, the performance doesn’t match the latest flagship phones, but if you simply need something reliable, cheap and long-lasting, this is your handset.

iPhone 5C

Smart Rating: 90/100
Release: September 2013

Apple’s pricing structure is steady and predictable: the newest models start at $200, the year-old model at $100, the two-year-old model at $0. This time around, however, the free model (the iPhone 5C) is noticeably different than its more expensive cousins. The newer models feature bigger screens and metal bodies; the 5C sports a plastic shell and compact screen. For some customers, the 5C will be exactly what they want anyway—and they won’t be able to beat the $0 price tag.

LG G Flex

Smart Rating: 90
Release: January 2014

The LG G Flex has a novel, curved display—the sort of unique hardware design you’d normally have to pay extra to enjoy. By now, however, enough time has passed—and a new model has surfaced—to make the original G Flex free with a 2-year contract. The curved display isn’t for everyone, but if you’re intrigued, you can try it for free.

Samsung Galaxy Alpha

Smart Rating: 90/100
Release: September 2014

Samsung’s small-screen Galaxy Alpha has a premium feel and solid performance. It’s the ideal phone for Samsung fans who never joined the big-screen revolution. With the impending Galaxy S6 launch, Samsung has slashed the price on the Alpha, making this an excellent time to buy.

Amazon Fire Phone

Smart Rating: 93/100
Release: July 2014

Yes, the Amazon Fire Phone flopped hard. Sure, the 3D effects were nothing more than a gimmick, and the internals weren’t anything special. A year later, however, the Amazon Fire Phone might actually be underrated. For the Prime subscriber and Amazon shopping addict, there’s still no better phone for optimizing your retail experience. And you can get the whole experience for $0 on day one—a happy consequence of all the bad press.


Smart Rating: 94/100
Release: September 2013

You might worry that the LG G2 is a little too old to warrant a purchase, as it was first released in fall 2013. Consider, however, that the LG G2’s performance was at least six months ahead of its time, and that the phone served as the prequel to our Editors’ Choice for Best Smartphone of 2014 (the LG G3). A $0 price tag? On that device? Crazy.

And it’s the best Android phone on this list.

HTC One (M8) for Windows

Smart Rating: 95/100
Release: August 2014

Normally, you have to sacrifice quality to get a free phone, but the HTC One M8 for Windows is both free and one of the best handsets on the market. Why? It all stems from popularity. Most people are on either iOS or Android, so HTC sells the Windows version at a discount. What’s more, HTC still isn’t as popular as Apple or Samsung, so the company is willing to cut costs to compete. Add it up, and the HTC One M8 is the best free phone you can get. If you haven’t tried Windows on a phone before, this is the perfect place to start.


Uh-Oh, Maybe Google Is Just as Bad as Comcast

A Google Inc. Fiber broadband network installation box
Julie Denesha—Bloomberg via Getty Images A Google Inc. Fiber broadband network installation box

Google Fiber, the ultra-high-speed Internet and TV service offered in a select few U.S. cities, is taking a page from the classic pay TV playbook by raising rates on some customers.

There is much to love about Google Fiber, Google’s superfast Internet and TV service that launched in Kansas City four years ago and has since spread to Austin, Texas and Provo, Utah, with expansion plans for Atlanta, Charlotte, and Nashville, among other cities. For $70 a month, Google Fiber provides Internet that’s roughly 100 times faster than the national average for broadband. Customers are also given the option of basic Internet on par with other broadband service for free, after paying a one-time fee of $300, or $25 monthly for 12 months.

Perhaps most refreshing of all, however, is that, Google Fiber has shown that Internet and pay TV customer service doesn’t have to suck. In fact, thus far at least, subscribers say that Google Fiber customer service is quite good.

That wouldn’t seem like a big deal in most industries, especially not when it comes to an upstart trying to win over customers from larger existing players. But hated pay TV and Internet giants like Comcast and Time Warner Cable have been bashed as awful, unresponsive, incompetent, and overpriced for so long, that it’s understandable if consumers assumed that this is always how things would be in this business category.

Yet a recent change in Google Fiber prices in Kansas City shows that even Google is capable of resorting to one of the business practices subscribers hate about Comcast—namely, raising rates.

When Google Fiber first launched in Kansas City, in addition to the Internet options mentioned above, subscribers were offered a package with 150+ cable TV channels and the superfast Internet service for $120 per month. According to the Kansas City Star, though, Google just raised rates by $10. New subscribers must now pay $130 per month for the same package. ($130 is also what Google Fiber subscribers pay for the package in Austin, though it looks like it still costs $120 in Provo.)

Google has blamed the price hike on rising programming expenses, among other factors. Regardless of the reason, the change should make it clear that Google is not immune to marketplace forces—and that monthly rates for customers can and probably will keep rising, just like they do with Comcast, Verizon FiOS, AT&T, and any other provider.

Then again, Google Fiber’s price hike only affects new customers. Existing Kansas City subscribers get to keep paying $120 per month for the time being, a policy that essentially rewards these customers for signing up early, and for their loyalty to the service. The standard pay TV price hike, by contrast, punishes loyal customers with monthly bills that rise relentlessly until the subscriber calls to complain and threatens to drop the service.

What’s more, as opposed to the vague, muddled pricing policies of the usual pay Internet-TV businesses, Google Fiber plainly spells out the terms of each plan. The basic Internet service, for instance, is free (after the construction fee) for a minimum of seven years at a given residential address.

Speaking of which, we must point out again that once the initial fee is paid, you can get broadband Internet totally for FREE. Such an idea would be unthinkable for the Comcasts of the world, which jack up fees and monthly rates unconsciously, and which would laugh off the concept of turning off the stream of cash under any circumstances.

TIME stocks

Apple to Replace AT&T in the Dow Jones Industrial Average

The entrance to the Apple Store on 5th Avenue in New York City.
Mike Segar—Reuters The entrance to the Apple Store on 5th Avenue in New York City.

The change will be effective with the open of trading on March 19

Apple later this month will be added to the Dow Jones Industrial Average, replacing AT&T on the key stock market index in the first shake up since 2013.

“As the largest corporation in the world and a leader in technology, Apple is the clear choice for the Dow Jones Industrial Average, the most recognized stock market measure,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices in a statement.

Rumors had swirled for days that Apple would be added to the index, and the electronics gadgets maker has Visa to thank for the change. Visa’s stock split lowered the adjusted price of Visa, which reduced the weighting of the information technology sector in the index. Adding Apple to the index would help partially offset this reduction, S&P Dow Jones Indices said. Apple’s stock split last June was also a factor, as it brought down the company’s stock price closer to the median price in the DJIA.

Shares of Apple were up slightly Friday, while AT&T shares were lower. AT&T had one of the lowest prices among DJIA constituents. AT&T was also bumped because the DJIA was determined to be over weighted in telecommunications, and AT&T has a smaller market capitalization than rival Verizon.

Apple will officially replace AT&T after the close of trading on March 18 and the change will be effective with the open of trading on March 19.

The last change to occur to the DJIA occurred in September 2013, when three new members were added: Goldman Sachs, Visa and Nike. They replaced Bank of America, Alcoa and Hewlett-Packard.

Apple earlier this year achieved another key milestone: it became the first U.S. company with a market value above $700 billion, which added to an already long list of achievements for the electronics titan.

This article originally appeared on

MONEY The Economy

Internet Activists Near Win in Fight for Net Neutrality

Republicans appear to be ceding the fight against net neutrality for now, but the FCC’s plan still faces stiff opposition.

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