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Frontier knowingly sold Internet speeds it can’t deliver, FTC lawsuit says [arstechnica.com]:
The Federal Trade Commission and officials from six states yesterday sued Frontier Communications [ftc.gov], alleging that the telecom provider misrepresented Internet speeds and charged many customers for higher speeds than it actually provided or was capable of providing.
The complaint [ftc.gov] was filed in US District Court for the Central District of California by the FTC and attorneys general from Arizona, Indiana, Michigan, North Carolina, and Wisconsin. California-based customers are represented in the suit by the district attorneys of Los Angeles County and Riverside County.
The lawsuit concerns the advertised speeds of DSL, which Frontier offers over copper lines in places where it has not upgraded to fiber-to-the-home. Frontier's failure to invest sufficiently in fiber was a major cause of its bankruptcy [arstechnica.com] last year. Frontier provides residential DSL Internet service to about 1.3 million consumers across 25 states.
The inherent limitations of copper-line DSL mean that speeds are slower for customers who live farther away from the nearest fiber node. A consultant's study found that nearly 30 percent of Frontier's DSL customers were likely to receive speeds slower than what they paid for, the lawsuit said:
In early 2019, a management consulting firm analyzed, at Frontier's direction and with Frontier's participation, Frontier's proprietary network data and internal records for nearly 1.5 million then-current DSL subscribers. This analysis found that approximately 440,000 of Frontier's DSL subscribers, or nearly 30 percent of the population analyzed, were "potentially" "oversold" on speed tiers that exceeded the actual speeds Frontier provided to them.
The FTC lawsuit alleged that Frontier often imposed speed caps that were lower than the speeds customers paid for, saying that the ISP "provisioned consumers for slower speeds than the tiers of DSL Internet service to which they are subscribed." Provisioning low speeds is often done because of real network limits. But provisioning sets an upper limit on speed, so customers can't get more than what they're provisioned, even in cases where the network is technically capable of providing the higher speeds an ISP claims to be selling them.
Thousands of customers complained
Frontier's slow speeds led to many customer complaints. "Since at least January 2015, thousands of consumers complained to Frontier and government agencies that the company failed to provide DSL Internet service at the speeds they were promised," the FTC's announcement of the lawsuit said. "Many consumers have complained that the slower speeds actually provided by Frontier failed to support the typical online activities they should have been able to perform at the speed tiers Frontier had sold to them."
Frontier violated the FTC Act's prohibitions on unfair and deceptive business practices by misrepresenting DSL Internet speeds and by using unfair billing practices in which it charged "consumers for a higher and more costly level of Internet service than Frontier actually provided or was capable of providing to these consumers," the lawsuit said. The complaint also alleges violations of state consumer protection laws in Arizona, California, Indiana, Michigan, North Carolina, and Wisconsin.
The FTC asked for a permanent injunction preventing future violations of the FTC act and for monetary relief. Officials from the six states asked for injunctions, civil penalties, and refunds for consumers. The FTC vote authorizing the lawsuit was 4-0; the FTC currently includes two Democrats and two Republicans serving as commissioners.
Frontier issued a statement calling the lawsuit "baseless," saying that its "DSL Internet speeds have been clearly and accurately articulated, defined and described in the company's marketing materials and disclosures."
"The plaintiffs' complaint includes baseless allegations, overstates any possible monetary harm to Frontier's customers and disregards important facts," Frontier said. "Frontier offers Internet service in some of the country's most rural areas that often have challenging terrain, are more sparsely populated and are the most difficult to serve. Frontier's rural DSL Internet service was enthusiastically welcomed when it was launched and has retained many satisfied customers over the years."
Frontier put caveats in “tiny, inconspicuous print”
The FTC lawsuit objects to Frontier's advertised speed promises, in which the ISP "represented that consumers can receive DSL Internet service 'up to' or 'as fast as' a particular speed quantified in Mbps," with those advertised speeds ranging from 1Mbps to 45Mbps.
Frontier ads prominently display a price and maximum speed, while stating "in tiny, inconspicuous print separated from the main message of the advertisement [that] 'Maximum service speed is not available to all locations and the maximum speed for service to your location may be lower than the maximum speed in this range,'" the complaint said. Frontier advertises speeds to specific customers despite knowing it won't provide those speeds, the complaint also said:
When Frontier sends mail to a consumer's residential address, or displays digital advertisements to consumers with residential addresses known to Frontier, Frontier has access to information indicating that it is unable to provide certain of its DSL Internet speed tiers to some consumers, based on factors such as the address's distance from Frontier's networking equipment, which Frontier can easily compute or estimate for many addresses. In numerous instances, Frontier has sent consumers advertisements for DSL Internet service at speed tiers that Frontier could not provide to them.
In many cases, "Frontier or its sales representatives have offered consumers, and those consumers have accepted, subscriptions for DSL Internet service at speed tiers that Frontier could not provide to those consumers," the lawsuit said.
ISP imposed speed caps lower than advertised rates
Frontier intentionally caps many customers' speeds to an amount that is below the advertised Mbps rate, the lawsuit alleged:
Indeed, network limits imposed by Frontier prevent numerous consumers from receiving DSL Internet service at speeds corresponding to the tiers of service they pay for.
Frontier imposes one such network limit when Frontier internally "provisions," or limits, the DSL Internet speeds it provides to each home connected to its network. A home cannot receive DSL Internet service in excess of the speed Frontier provisions to it.
Frontier purports to set its provisioned speeds in part to enforce the distinctions between the speed tiers it offers to consumers, and in part to reflect what Frontier predicts to be the limits on the speeds Frontier is technically capable of providing to a given consumer... In numerous instances, Frontier has provisioned consumers for slower speeds than the tiers of DSL Internet service to which they are subscribed, preventing those consumers from receiving service at speeds corresponding to the tier of service they pay for.
The provisioning sets an upper limit on speed "but not a lower bound," the lawsuit notes. Many customers rarely or never get the maximum provisioned speeds "due to factors known to Frontier and within Frontier's control, including physical factors, such as long distances between Frontier's central networking equipment and consumers' homes, and technical factors, such as low-bandwidth, obsolete, and/or overloaded DSLAMs and networking equipment," the lawsuit said.
We wrote more about DSLAM (digital subscriber line access multiplexer) technology in this 2015 article [arstechnica.com] titled "Internet nightmare: AT&T sells DSL to your neighbors, but not to you."
“Consumers continue to be harmed nationwide”
Since 2015, the attorneys general of West Virginia, New York, Nevada, Pennsylvania, Washington, and Minnesota have brought enforcement actions against Frontier alleging that it misrepresented DSL Internet speeds to consumers, the FTC lawsuit noted. Frontier settled all of these cases but "has failed to remedy its practices, and consumers continue to be harmed nationwide," the lawsuit said.
A report commissioned by the California state government found that Frontier let its copper phone network deteriorate [arstechnica.com] through neglect since 2010, resulting in poor service quality and many lengthy outages. Frontier emerged from bankruptcy [arstechnica.com] on April 30, saying it plans to double its fiber-to-the-premises footprint by extending fiber to more than 3 million homes and businesses over the next few years.