Verizon Fined For Pretending That Limited Service Was Unlimited

from the watch-out-comcast... dept

Back in 2005, we noted that Verizon Wireless was following the tactics of others in advertising “unlimited” wireless broadband services, while the truth was they were quite limited. As people later worked out, despite the claim of “unlimited,” VZW was cutting off anyone who used more than 5 gigs of data per month. That’s pretty limited, actually. When confronted about this, the company tried to argue that by “unlimited” it really meant “It’s unlimited amounts of data for certain types of data.” And they followed it up with this gem: “It’s very clear in all the legal materials we put out.” Right, see, that’s the legal materials — the stuff you know no one reads. Yet in the marketing materials it’s quite clear that you’re claiming “unlimited” and that has a pretty clear meaning. After many such complaints, Verizon Wireless finally started to back down from the false claim of “unlimited” earlier this year. Turns out that it wasn’t because of any realization that lying to your customers is a bad idea, but because NY State was investigating the practice. NY has now fined Verizon Wirelss $1 million to be given out to customers who had their service unfairly terminated for actually believing that “unlimited” meant “unlimited.” Of course, Comcast might want to start paying attention right about now. While lawyers everywhere are rushing to file lawsuits over its decision to jam broadband user accounts, before that happened Comcast was famous for many, many years for being one of the biggest ISPs to lie about offering unlimited service. It’s a story that comes up in the press every year or so, and every year Comcast gives its own doublespeak about how it only cuts off the worst “abusers.” However, it’s still false advertising to claim unlimited service when that’s not what you supply — and it’s hardly “abuse” if people are merely doing what you told them they could do.

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Companies: comcast, verizon

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Comments on “Verizon Fined For Pretending That Limited Service Was Unlimited”

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Anonymous Coward says:

Cost of doing business

$1 Million is just the cost of doing business. Besides, corporations do not feel pain. If the bottom line is in jeopardy, management will just lay off more people due to “financial pressures”. The only result is that customer service will suffer. Although, it’s hard to imagine how much worse customer service can get.

The only punishment that will have an impact is directly fining a fiduciarily responsible person (C level executive or member of the board). Make it come out of that person’s pocket (no insurance, corporate reimbursement policy, etc.).

Once a little personal responsibility is injected into the mix, behaviors might change.

However, there is exactly zero chance of this happening. In lieu of that, the fines must be punitive enough to catch the attention of Wall Street and major stockholders.

The Last Angry Man (user link) says:

Good Luck

Cs or O level execs will never have their personal assets in jeopardy, this is the very shield afforded to them by incorporating by anyone for that matter, to shield personal assets from business assets.

A solution could be that, the CEO (add your flavor of C”blank”O) is fired w/o compensation for laying off folks and not giving a rats ass about anything other than the bottom line.

For those that are interested check out Gangs of America: The Rise of Corporate Power and the Disabling of Democracy. Open your eyes.

R. H. (profile) says:

I Dislike Corporate Thuggery But...

If I was a stockholder in a corporation who had a CEO that DIDN’T watch the bottom line I’d probably be quite unhappy when my the value of my stock approaches the value of toilet paper. I truly believe that there are ways to earn money without screwing the consumer however, if those ways aren’t espoused by the entire industry then the companies that choose to screw over its customers will have an advantage. I can’t think of a good way to legislatively force that change without causing an even further worsening of the economy at least in the short to mid term. Maybe a few years ago during the dot-com bubble when we had a bit of breathing room but not right now.

R. H. (profile) says:

Re: I missed one point

How in the world did they advertise ANY type of broadband with a hidden 5GB/month limit? At just 1mbps you can get over 10.5GB in one day so I can imagine people going over that even in the ‘early days of broadband’ where 384kbps could be your d/l speed and even then that’s 3.95 GB per day.

I transfer between 5-8 GB per day, and I’m on Comcast! I’ve been making sure that I stay under 200GB/month though to stay nice and far beneath undisclosed caps.

Max Powers at (user link) says:

Fines are a joke for companies

Many companies that get in trouble actually win. The fine is a joke, the customers get crap, and business continues as always ripping off the customer.

Blue Hippo stole millions from customers with their pay as you go computer offer because they never would deliver the computer. The fine when they got caught? $300,000.00.

My dream is somehow all consumers will gather and come up with a plan to screw these bad businesses by hurting them in the pocket book. Is it possible?

Steve R. (profile) says:

Where is the call for Corporate Ethics???????

What I find amusing about this current outbreak of corporate malfeasance is the absence posts demanding that corporations correct their abusive behavior by those who oppose regulation. By their silence, the obvious conclusion is that those who oppose regulation must secretly believe that it is OK for corporations to steal from your customers. If caught, you issue a meaningless apology and go onto the next scam.

I would think that those who oppose regulation would actively call for corporations to improve their ethics to avoid the imposition of onerous regulation. This obvious solution seems to beyond their mental grasp.

All I hear by the anti-regulatory crowd is that regulation “hurts” business. Ok if regulation “hurts” business and we live in a free market system where we are responsible for our actions; the obvious solution is act ethically. If corporations act ethically, there would be virtually no need for onerous regulation that would “hurt” business.
Thanks Max, I have been wondering what the scam was behind Blue Hippo. The Blue Hippo ads were laughable. “We will give you a break and not check your credit”. Of course they don’t mention that you have to pay upfront.

Rico (user link) says:

Re: Where is the call for Corporate Ethics???????

I’m with anti-regulatory crowd — not because I approve of corporate scams like this, but because I don’t trust the government to always know what is best for me.

The best way to stop this behavior is to expose it. If the government wants to help, they can pump money into consumer education, so that we know how to compare services accurately. Verizon’s practices cannot stand the light of day.

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