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FCC Chairman ‘Deeply Troubled’ by Verizon’s Plans to Manage Speeds of Data Hogs

By Josh Long
July 31, 2014 - News

**Editor's Note: Which is America's top wireless network? Click here to see what we discovered.**

A small fraction of Verizon Wireless’ 104.6 million retail connections have a tendency to hog bandwidth, prompting the company to manage the speeds of the top 5 percent of data users who subscribe to unlimited data plans.

FCC Chairman Tom Wheeler isn’t happy. In a letter Wednesday to Verizon Wireless CEO Daniel Mead, Wheeler said he was “deeply troubled" by the wireless carrier’s earlier announcement that it plans to slow the data speeds of some customers beginning in October.

“It is disturbing to me that Verizon Wireless would base its ‘network management’ on distinctions among its customers' data plans, rather than on network architecture or technology," wrote Wheeler, a former CEO of the Cellular Telecommunications & Internet Association.

‘I know of no past Commission statement that would treat as ‘reasonable network management’ a decision to slow traffic to a user who has paid, after all, for ‘unlimited’ service," he added later.

Wheeler asked Verizon Wireless to answer a number of questions, including how it could justify its conduct under open Internet rules that the FCC adopted in 2010 including a “transparency" regulation that remains in effect. He also inquired into why the company was “extending speed reductions from its 3G network to its much more efficient 4G LTE network."

On its website, Verizon Wireless explained it may reduce the data speeds of customers on an unlimited plan at times of high demand on a cellular tower and only “when necessary for us to optimize data network traffic in that area." As of March 2014, the top 5 percent of data users were consuming 4.7 GB of data each month, according to the company.

Verizon Wireless said it will respond to Wheeler’s letter after it has received and reviewed it.

“However, what we announced last week was a highly targeted and very limited network optimization effort, only targeting cell sites experiencing high demand," the company noted in a written statement. “The purpose is to ensure there is capacity for everyone in those limited circumstances, and that high users don't limit capacity for others."

Verizon Wireless distinguished its practice from what’s known as “throttling," in which data speeds are reduced for a customer’s entire billing cycle. The company said it only reduces speeds at times of high demand.

“Once you are no longer connected to a site experiencing high demand, your speed will return to normal. This could mean a matter of seconds or hours, depending on your location and time of day," the company explained in a Q&A.

In mid-2012, Verizon Wireless stopped offering unlimited data plans to its customers. However, existing subcribers with the plans can keep them if they pay full retail price for their device. The company doesn't disclose the number of customers on its unlimited data plans. But as of the second quarter, more than half of Verizon Wireless' accounts subscribed to More Everything Plans with shared data.

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