Suit accuses AT&T of overbilling for iPhone, iPad data [u]

Use overstated by 7 to 300 percent, lawyers claim

(Updated with detailed AT&T statement) AT&T is regularly overcharging iPhone and iPad owners for data consumption, a new lawsuit alleges (video). The case's lawyers say they have spent $80,000 testing the claim, in one case buying a new iPhone and turning off anything that could impact 3G data use. AT&T nevertheless ended up sending a bill for 35 data transactions.

The carrier overbilled on every recorded transaction, the lawyers elaborate. While the surcharge was only 7 to 14 percent in most instances, spikes of up to 300 percent were observed. For an individual the impact may be only $10 to $15 a month, but the lawyers suggest that given millions of AT&T subscribers, the company could be making substantial amounts of cash by not providing accurate billing.

AT&T insists that the allegations are "without merit," and also that customers misunderstand how data is charged. People may for instance be unaware of automatic app updates happening in the background, the company says. It may be referring to things like push notifications, which require status checks that consume small amounts of data.

Update: AT&T has released a more detailed statement to MacNN. "Accurate billing is clearly important and, unfortunately, there have been some incorrect claims about our data usage billing practices," a spokesman says. "We properly bill for all data that our customers send and receive, including data activity that runs in the background on smartphones and other powerful data devices. Data usage for emailing, downloading applications, browsing the web, downloading a video or streaming music is applied to a customers' data plan. So are real-time updates to applications, such as weather, sports scores, or stock tickers.

"Particularly for smartphones, tablets and other advanced mobile devices, applications are often constantly running in the background and engaged with our network."

  1. Arty50 05/19, 11:38am

    People have been testing AT&T's new broadband meter vs their own meters (usually via a router based meter which should be fairly accurate), and low and behold AT&T's meter is way their favor of course.

  1. climacs 05/19, 12:03pm

    for an individual the impact may be only $10 to $15 a month

    unless you're wealthy, that's a significant amount, using the modifier 'only' strongly implies it's not significant.

    Pennies a month is insignificant but multiplied by millions of customers per month, it's significant.

    $10 to $15 a month (if true) is around 10% of a typical iPhone bill. Yeah, I'd like to get that back if these guys are right.

  1. charlituna 05/19, 12:17pm

    The only way to turn off 'everything' that deals with data is to power off the phone.

    Comment buried. Show
  1. johncarync 05/19, 12:18pm

    Don't get bent out of shape. You will get charged $0.00 extra for data consumption if you are below your data plan max for the month. Most people don't exceed their max. If you are exceeding your max, you should upgrade to a data plan with a higher max.

    It's still wrong if AT&T is overcharging but it probably affects less than 5% of their customers.

  1. Stuke 05/19, 02:34pm

    so what will AT&T do? They're struggling to not loose customers to Verizon, struggling to win final approval to buy T-Mobile, and now being accused on over-charging on data plans. The right thing to do...acknowledge it as a problem, fix it, and move on. The wrong thing to do...deny it, try to fight it with words, run your own tests (jeez...didn't you run tests before releasing the device on your network years ago, and repeated with every new model!), and basically ignore the problem thinking the little guy is wrong. All the little guy wants is fairness with what s/he has paid for, and if that is a leaky data stream device (iPhone is just one example), then so be it. BUT, now we know. Now we know to unplug our TVs and VCRs to avoid trickle current expenses in our homes ( do unplug your devices and live with a blinking 12:00 on the VCR, right...), so surely we'll care about the $10-$15 per month overage we're being charged...even if we're not the 5% that exceeds their data plan each month.

    All of this said, it means that AT&T now has an obligation to investigate it; BUT, they had better do it now, fast, and get it right in the eyes of the consumer (who is right or wrong) because with competition comes choice!

  1. testudo 05/19, 04:22pm

    Some set of lawyers getting together to create a huge class action lawsuit. Apparently the merit of said lawsuit depends completely on who the defendant is. If Apple, the lawsuit is of course without merit. User error or just a plain money grab. If ATT (or another carrier), it of course must be true. The lawyers would never nudge their stats or tweak certain settings that show their point more than the others.

    I'd also love to hear about these 300% overage charges. Plus, can they explain exactly how they determined how much was actually being transferred? You can't just say "Well, I downloaded a 200KB photo, and it says I used 330KB. ATT lies!"

    Comment buried. Show
  1. facebook_Clarence 05/19, 06:09pm

    My iPhone was using loads of data bandwidth sending information back to Apple so they could track me. It was like a 15% tax on all data transmissions. Switched to Droid and never had a problem since.

    - Sent from my Android device.

  1. iria 05/19, 07:59pm

    I remember this same story, right down to the iPhone experiment, from late January.

  1. macmedia1 05/19, 11:34pm

    I bought 4 new ipad2's from Best Buy on launch day which BB required that I sign up for a minimum 1 mo. data contract ($15). I unfortunately agreed to it. They NEVER got turned on. I took them to Hong Kong to give them to family BUT first stopped the service 2 weeks after the purchase. 2 months later, I get 2 new bills for each ipad saying I owed $35 per line. I had to call 4 separate times staying on the phone between 30 minutes and 60 minutes each time to get them to cancel the charges. Twice they said I had 4mb and 6mb respectively of data usage which they said was nothing. I told them they weren't even turned on. I didn't want to argue with them as they canceled the $35 charges but I never got the unused 2 weeks initial usage refunded.

    I filed a complaint with the FCC website and was immediately contacted (but too busy to respond right now.

    AT&T is a bunch of crooks. I'm just 1 person having problems. Imagine the millions that bought the 3G ipad and ipad2 and add up these "mistakes".

  1. testudo 05/20, 01:34pm

    Your complaint is about billing, not about them reporting incorrect data usage. Why didn't you stop the service the same day? Why did you agree to stupid Best Buy saying you HAD to sign up for one month?

    And you can be so bothered by ATT to complain to the FCC, but can't even be bothered respond to them when they want input.

Login Here

Not a member of the MacNN forums? Register now for free.