AT&T Sued For Inflating Data Charges For iPhone and iPad Users

By Tracey E. Schelmetic May 23, 2011

Hard on the heels of an independent study that found that users of iPads and iPhones using AT&T as their carrier were being routinely overcharged for data, an iPhone customer has decided to sue the telecom giant in response.

Patrick Hendricks has filed his suit in the Northern District of California, seeking class-action status and alleging that AT&T is “committing unlawful and fraudulent business practices by regularly overbilling customers for data transactions,” said Wired News.

“AT&T’s billing system for iPhone and iPad data transactions is like a rigged gas pump that charges for a full gallon when it pumps only nine-tenths of a gallon into your car’s tank,” said the complaint.

AT&T, like a number of telecom companies, last year suspended “all you can eat” data plans and instead have begun charging customers based on usage, creating a “tiered” pricing structure.

Wired.com’s Ryan Singel says the reasoning behind the shift to capped data is not to reduce costs — bandwidth costs are extremely low and keep decreasing — but rather to mitigate network congestion due to limited infrastructure.

Hendricks’ lawsuit suggests the switch to these tiered pricing plans – at least on AT&T's part – is so the company can “pad” data usage by customers, thus driving up cell phone bills. The suit lifts data from an independent study conducted recently that found that AT&T was overstating Web server traffic by seven to 14 percent, and in some instances by as much as 300 percent, in order to inflate the charges for users of iPhones and iPads.

An AT&T spokesperson responded to Wired.com's inquiry and stated that Hendricks’ complaint “made incorrect claims.”

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Tracey Schelmetic is a contributing editor for TechZone360. To read more of Tracey's articles, please visit her columnist page.

Edited by Jennifer Russell

TechZone360 Contributor

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