AT&T being sued for overstating iPhone and iPad data usage

AT&T faces a new class action lawsuit claiming that AT&T is overstating and over-billing iPhone and iPad data charges. The class compares AT&T's billing system to a rigged gas pump that charges for a full gallon when, in fact, it only pumps nine-tenths of a gallon into your car's tank.

In the new complaint, named plaintiff Patrick Hendricks claims that AT&T's overbilling "was discovered by an independent consulting firm retained by plaintiff's counsel, which conducted a two-month study of AT&T's billion practices for data usage, and found that AT&T systematically overstate web server traffic by 7 percent to 14 percent, and in some instances by over 300 percent. So, for example, if an iPhone user downloads a 50 KB website, AT&T's bill would typically overstated the traffic as 53.5 KB (a 7 percent overcharge) to as high as 150 KB (a 300 percent overcharge)."

Additionally, the consulting firm discovered that AT&T also bills for phantom data traffic. They set up a test account, disabled push notifications and location services, had no email accounts configured, closed all apps, and didn't touch the iPhone for 10 days. During that time, At&T billed the account for 2,292 KB of data usage.

This is like the rigged gas pump charging you when you never even pulled your car into the station.

If the over-billing is true, then this could have a significant impact on AT&T's bottom line. Granted, there are a lot of people this would never affect; however, those who barely exceed their allotted data cap must pay twice as much for data that month.

Have any of you used more data than what your plan includes and been billed extra? Do you suspect that AT&T overstated your usage and overcharged you?

[Courthouse News Service]

Leanna Lofte

App and Photography Editor at iMore. Mother, wife, and math instructor. Follow her on Twitter @llofte and send her apps to consider for review at iosapps@imore.com

More Posts

 

0
loading...
0
loading...
0
loading...
0
loading...

← Previously

Daily Tip: How to use multiple iTunes libraries on a single Windows or Mac PC

Next up →

Apple seeds iOS 4.2.6 for Verizon iPhone in advance of launch

There are 79 comments. Add yours.

xDAKx says:

I have noticed that my data usage since switching to AT&T with an iPhone has been higher than when I has an iPhone with T-Mobile, but I had passed this off as just that I was using my device more than I had on T-Mobile, however if the findings of this consulting firm are correct it could explain the difference I've been seeing.

xDAKx says:

*when I had an iPhone on T-Mobile.
I can has T-Mo iPhone? Lol.

daveamato says:

The iPhone could be unlocked, and the data usage differences could be the availability to the providers hotspots

Peking says:

I dont believe it.Hats off to these Jailbreakers. For latest on iPhone,Ipod,iPad,Apple,Android and Jailbreak visit www enews plus .com thanks

Jason T. says:

Okay, this may be off point. But I too feel like I have been scammed by AT&T. I signed up for a 50MB data plan during a recent trip to Germany (12/22/10 thru 01/09/11). I was visiting a friend that had "wi-fi", so I used her password to sign up to her "wi-fi" account thinking that I had remembered seeing something about "saving on international data charges" (I understood that using wi-fi would preserve my international data for use outside of her wi-fi zone). Well, about halfway through my two week trip, I get a message from AT&T stating that I had used approximately 140MB. I panicked in the middle of the night, pissed off my friend, and called AT&T to find out that I now owed somewhere well over $500.00 in overage charges. When I spoke to a representative of AT&T, I was informed that even though I was using wi-fi, my "data roaming" remained in the "on" position and I was, therefore, "roaming" even when I was sitting in her living room, connected to her wi-fi from about ten feet away. Anyway, the kicker is that I threw a fit and told them that I hadn't seen a single warning or notification that connecting to wi-fi setting would not override the "data roaming on" position, or that otherwise I would have to turn "data roaming" to the "off" position when using wi-fi to alleviate overages. I still can't find a single remark in the end-user agreement or even at (http://www.wireless.att.com/learn/international/roaming/iphone-travel-ti...), a page that is for the distinct purpose of helping people like myself. When my complaint was finally heard, I was told that they understand that I didn't receive a warning, and that all they could do would be to up my international data plan to the $199/200MB plan to cover any possible overages for this billing cycle and even the subsequent billing cycle (b/c all data usage could not be viewed in the current month of January). I paid the extra $200 b/c I am a good person, powerless, and arguing on the phone (any more than I already had) seemed futile. I can't help but think how convenient it is for AT&T to allow their users to go over their limit using "bait-and-switch" techniques such as this, and still get away with saving them "thousands" of dollars by changing their plan to a larger plan than what they normally need or originally purchased. Isn't this a "misrepresentation" under the Texas Deceptive Trade Practices Act? Has anyone else experienced this problem? Anyone know of any class actions against AT&T for similar acts? Want to start one?

eric6052 says:

Would this really surprise anyone if its true? The carriers view us all as sheep to be sheered. Im sure they will have some reason for overbilling that will be so much techno mumbo jumbo that any potential mirrors wouldn't understand.

joseph says:

this is just another wake up call to everyone, REVIEW YOUR BILL. don't put off calling at&t about any concerns you may have. we all have a responsibility to make sure that we are not being overcharged; yes, it takes more effort than merely having faith in at&t or any carrier for that matter, but if we dont' do our job and check for mistakes then we're just as negligent.

iainplaysdrums says:

I've been charged for supposedly going over my 200mb (itself a ridiculous limit for what you pay). There just needs to be a serious overhaul in how customers are charged.
In the UK, where I'm originally from, for around $18 a month you get unlimited texts and at least 500MB of data on a leading brand (O2), unless you top up your phone more and then you get unlimited data. People need to be allowed to not be on a contract, paying insane line fee charges as well as a ridiculous amount of money to text and/or data. People just accept the charges because they think there's no other way, and that's the way it is.
It's crazy to me, an unemployed person, that some people spend hundreds of dollars a month on just their phone plan.

USAFRetired says:

Unfortunately, the European model will never be implemented here in the US. Can you imagine how much money us carriers would lose if they allowed free incoming calls like they do in Europe? Also, the pay-as-you-go in Europe is a lot cheaper than here in the US. We seem to be behind many countries when it comes to cellphone service. There's no doubt that profit has a lot to do with it.

Treyster says:

To be fair the costs of building a network throughout the United States far exceeds blanketing, say Norway. And that's the inherent problem. Because most customers want a fair nation wide coverage the extra costs get put down on the consumer.
On the other hand they needlessly overcharge on things like texting and even phone calls themselves are reaching a pretty flat cost for carriers.

name says:

The costs of network building are not that much related to area coverage but population density. So by oversimplifying one could say that building a nationwide coverage in US is more profitable (and should lead to cheaper data/call rates) than in countries that have smaller population density than US. I'm guessing that's not a reality and US does have a bit overpriced cell phone data/call rates.

GeorgeDW says:

Glad I still have my unlimited plan. I never used to use more than 500MB, but in the last few months I've been streaming podcasts on my way to work and my usage has jumped up to 1.5GB or so.

webvex says:

I don't know about the first case, but I've definitely seen the second. Just check your detailed usage on the AT&T website and you'll probably see random 50+MB transfers very late at night or in the early morning hours. They show up on both of our iPhones, and I've tried similar tests, turning off everything. There's actually quite a bit of discussion about this since they went to the tiered plans. AT&T has made little explanation, saying it's maintenance and we won't be charged, but they do charge for them.

Jaimex99 says:

Oh, yes. I started using my iPad 3G with an unlimited plan. After a few months, I noticed that my usage did not exceed 250mb per month, so I got the lowest plan. When I switched, magically, my usage went up and I ran out of data in 15 days, so I had to get the 2Gb plan. When again I noticed I wasn't using it all up, I switched back to the 250mb plan only to experience the same sudden data overcobsumption, which now I know may have been overcharging. I have had the 2Gb plan ever since, but I always wondered if they had been overbilling me for data when I was in the smaller plan.

Johnny Ixe says:

There's a related article on TiPb.com "DataMan for iPhone – app review".http://www.tipb.com/2010/12/11/dataman-iphone-app-review/
You may find the DataMan app useful as DataMan can help to verify a user's data usage with that reported by AT&T. DataMan is used by many users who have been hit by mysterious usage. See:http://www.nojitter.com/feature/228400089

Mom of Naa says:

I'm sticking with my unlimited plan. Come hell or high water.

webvex says:

Then you're sticking with 3G forever. Tiered plans and data caps are the future, for cable/DSL too. The days of all-you-can-eat data are disappearing fast. That's OK, but they have to be honest. These shenanigans are Verizon-worthy.

TreSupreme says:

"These shenanigans are Verizon-worthy"
Um that's not possible because Verizon still has unlimited data available for smartphones. Failed attempt at trolling on Verizon.

USAFRetired says:

I'm sure ATT and Verizon will do something to the 3G networks to force people into those highly profitable tiered services. The big questions is when.

Mike says:

Same here. 17gb per month at standard overage rates would break the bank faster than the US government.

Dimwit says:

Not trying to take att's side, but, is it possible that SOME of this phantom data is associated with visual voicemail? I'm honestly just asking, as I have no idea.

webvex says:

No. Did you read how they tested? I don't even get visual voicemail, and I know I had absolutely nothing running overnight when these transfers happen. No notifications, nothing, and these suckers are huge, often well over 50MB at a time.

Alex says:

Not surprised that someone finally called AT&T on their crap.

AdamSass says:

I thought the same thing as Dimwit. Visual voicemail or texting can use data

Darwin says:

Considering that there are many things going on with an iPhone that require a data connection I don't see how 2 MB of data usage over 10 days is anything to be concerned over. Visual Voicemail checks and App Store update checks could account for that, but we don't know because this article is extremely thin.

scott says:

The problem is if you have the 200 Mb plan, and you are sitting in the 190 area, a little padding can cost you an additional $15.00. That IS a problem. Also, the way ATT has the plans set up. If you hit your 200, and there is ONE day left in the month, you pay $15.00 FOR ONE DAY USAGE. If you have the 2Gb plan, $20.00 for ONE DAY. Don't think you will use 2Gb in a day, but you just bought it. If they were truely interested in making this fair (yea, RIGHT) it shoud be $15.00 for the 200, and another $15.00 when you use it up. I would like to see how many people pay for this data only to never use it.

Justin Fowler says:

While I think this is extremely unfair, I do not have these problems. I hope this sets AT&T straight, at least for data. I personally don't see how they are even still running, they have horrible cell phone coverage, terrible internet service, and (from what I've heard) bad customer service

John P says:

AT&T's customer service has been great for me. They will actually give out credits and have a better FAN discount program than Verizon. They also gave me my unlimited data back on both lines.

joseph says:

i'd have to agree. i've never had issues with at&t's customer service and i've owned over 20 iphones as well as many a blackberry.

scott says:

20 Iphones?? What are you doing with them?? And if only the first was discounted, and you paid full for the others, how do you afford them?? Not to mention all the BlackBerry's too.

joseph says:

20 iphones over the lifetime of iphones, from first gen to present. avid purchasee at at&t stores, best buys, craigslist. and when i got tired of them i could always find a sucker on craigslist to pay over the top for whatever iphone i had to offer. same with my blackberry fetish.

Clubcarib says:

My wife is not a heavy user by any means. In fact she only uses her phone while at home and on wifi. She has been on the 200mb plan since June, and has been hit with three overages already. When I started looking into her data usage, she was having transfers of 171 mb at a time! (at 1 AM) She doesn't stream music, movies, or anything that uses a lot of bandwidth, so how can a data transfer that big happen? We called, complained, got the runaround, and finally got partially refunded for one months over charge. Coincidentally, ever since we complained last month, there has not been one single patenting charge on her account. Interesting. I will most certainly be keeping an eye on this suit.

Clubcarib says:

Patenting = unexplained. Odd choice of autocorrect

OhFerFuxSakes says:

LOL @ the picture of Rickson! Awesome!

Chucknoah says:

Have you guys tried using DataMan app to verify your data usage against AT&T's records? TiPb.com has a review article on DataMan app.

Johnny Ixe says:

Yes, DataMan is used by many users who have been hit by mysterious data usage. As DataMan records your data use every 10 minutes, it gives great details that you can use to prove your carrier's reports.

webvex says:

I've used Dataman, as well as the built-in Settings usage statistics. I don't think the charges are bogus. I think the data is really being sent. The question is why, and we aren't causing it. The volume is way above anything we've done on our device, as in @Clubcarib's story. It appears to be something like an update or data gathering between the carrier and the phone, and AT&T is certainly charging us for it.

DJH says:

I use DataMan, and don't consider it to be a perfect means of monitoring my data traffic. I found that it does not log any traffic after the device is power cycled until the user manually runs the app. Don't be fooled into thinking that it's still running in the background after bootup just because it appears in that list of running apps (whatever Apple calls it). I forget to do this too often, so the app isn't very effective for me.

xxDruMMer BoYxx says:

Whooooo!!! Now this is news. Good job TIPB!!! Great article! None of that apple google android drama talk.

Glenn#IM says:

FCC had a probe on verizon in 2010, and around October 2010, verizon announced they would refund customers. Most would get $2.00-6.00. Now this may not sound like a big deal, may be an honest mistake. $2.00-6.00 such a small amount you would think? The pay off involved 15 million accounts, at about $50 million. That is what they admitted to. Some customers didn't even have a data plan, and were charged. It was only a matter of time until AT&T had the same problem. We do not think much about data, and $2.00-6.00 extra charge, but carriers can make a fourtune, if customers do not keep track of data charges. I am sure other carriers di it also, they just have not been caught yet.

sting7k says:

Could the phantom data have been the early AM uploads that are supposedly diagnostics being sent to Apple, if you agree when you set up your iPhone.

raid says:

screw att and verizon they both nickel and dime you for every thing like paying for visual voicemail on verizon. sprint is where its at unlimited data and unlimited mobile to mobile you cant beat it.

joseph says:

i recently dropped sprint for at&t. i went from the evo 4g to the iphone 4. i got sick of paying $10 for premium data (4g) when it was never picked up by my phone. not only that, i couldn't stand going into my local grocery store and having my phone begin to ROAM and never knowing when outbound SMS/MMS messages will be received. many a time i would send a SMS/MMS message only for it to be received hours later. while on at&t i have seen my friends on sprint deal with a similar dilemma. sure neither at&t nor verizon (not even t-mo) could beat sprint's 69.99 unlimited plan (plus my employer discount, less the premium data charge) but as much as i use my phone and send SMS/MMS msgs i need to know they're not just hanging out in a cloud somewhere and that they've been received. unlimited M2M/data does not justify poor carrier service.

joe says:

That $10 you complain about....its a legit charge for phones like the evo and epic......do you really think a $70 a month plan for a rumor or a lotus is equal to the usage of an evo or epic with all the high quality streaming you can do

chirmer says:

It's not legit if you don't get 4G in your area.

joseph says:

i don't stream THAT much; that i leave for WI FI and if i'm in a WI FI zone i tend to have a computer on hand. i text more than anything else and their (sprint) texting service is dismal (or was for me over several contracts with different phones).

jzajzz says:
  • The Sprint Premium data charge is NOT a 4G charge.. it's a charge for High end phones that use more data than average phone. You are still paying way more with AT&T
  • Sprint tells you that they are charging you 10 a month beforehand .. You agreed to it. But you rather go with AT&T who charges you for phantom data. That's weird.
  • I have Sprint but I never had these hangups on SMS.. and Also ..I can actually make phone calls in my house. When I had AT&T .. I had to run outside in the middle of winter just to pick up my phone. .. and apparently many consumers have had the same problem with AT&T
joseph says:

i wasn't aware that the $10 i'd be paying to sprint would be for a service i never used - my phone never got 4g - this was clearly mentioned in my comment so that readers would not be weirded out/ confused. i also said that at&t charges more than sprint, but i clearly outlined why i am with at&t and not sprint;. and in regards to sprint working better in your area than at&t, that's informative, thank you for sharing; it's a testament to that fact that user experience with the main 4 carriers differs across the USA. at&t says it covers all but 3% of americans and maybe you're one of the latter.

jzajzz says:

AGAIN ...
Sprint DOES NOT charge for 4G ... Sprint DOES NOT charge for 4g .. I don't know if I can make it any clearer .. Sprint DOES NOT charge for 4G
Sprint charges for "premium data" .. which basically means that Consumers who buy EVO or Epic will be using data a lot more than Sanyo Zio customer... kind of like the AT&T plan for the IPHONE. It might be different now.. .but when the Iphone first came out AT&T had a different plan for the Iphone .. it was more expensive because they figured Iphone customers would be using data a lot more..
Capisce???

Lars says:

Yes!!!! I have experienced this myself - the "phantom data traffic"... I'm glad someone is pushing back at AT&T!

joseph says:

i just reviewed my bill from at&t and it showed that i used 307MB in the summary section but the detailed history said that i used a subtotal of 313,978 KB.

joseph says:

please refer to JR reply below.

name says:

I don't get it. Why is it claimed that loading of 50KB web page should only generate a total of 50 KB data traffic and how is it in any way related to a car gas consumption?
I agree that no carrier should charge for non-existent data traffic but current case is such an oversimplification of communication technology.
Data traffic is not fuel. ANY internet communication crates data packets, no just data download, so the process of requesting and loading of a 50KB web page always creates more traffic than 50KB.
How on earth can AT&T know how large the loaded web page was? What if a user downloads something else, not web page (online gaming etc.), how large is the 'useful' data part?
How can AT&T measure for just the 'useful' part of data traffic?
Think, people, think!

Tony A says:

If that is the case, How can they charge us for a data that they can't measure properly? and why do they charge us for overages even if it is 1 kb? Then the whole system doesn't make sense at all!

Tweger01 says:

I'm sorry, Rene, but that picture is horrible. You guys really need a graphics department.

chirmer says:

I'm a graphic designer, and I've always enjoyed the patchy, funny photoshop jobs these guys/gals do :D They make me chuckle.

treoprouser13 says:

Yes I have noticed that without depending on wifi most of the time, I will burn through 1 gig or more in about 10 days. That's just from push email and moderate surfing. Little to no streaming. Or if I do stream it's a brief 5 minute video on YouTube. I was without wifi for a bit and was shocked at how fast the data was getting used up. I stopped surfing and still watched the data usage meter go up to the point that I got a warning text message from att saying I was over 65% of my limit. They gave me a "hint" to use wifi. I now feel that while limits on data are going to be the law of the land soon for all carriers, 2 GB is artificially low and a deliberate ploy by att to bilk customers out of more money. The findings in this lawsuit do not shock me at all.

lavasusan says:

I went on a trip to Europe with my AT&T iPhone, and I deliberately zeroed out my usage setting and took a screenshot of it at zero (the page listed the date) just before I turned off the phone and got on the plane. I turned the phone back on in Europe. About 12 days into my trip, I got a phone call (!) from AT&T telling me that I was at 83 MB usage, way over the 20 MB plan I had signed up for. Panicked, I agreed with the AT&T rep to upgrade to the 100 MB plan, as I still had several days left in Europe.
However, when I ended the call and turned to my usage setting, I saw that I had in fact actually used only about 55 MB of usage, almost 30 MB less than the AT&T rep said I had. Suspicious, I snapped a screenshot then, and when I returned to the US.
When I got home, I had a huge bill, because AT&T said that I had exceeded my 100 MB plan by about 30 MB. My own record showed far less than 100 MB usage. I called AT&T, and got STUPID responses, like I should talk to Apple about why their phone wasn't tracking the usage accurately. I talked to three reps, and told them that I could prove via the screenshots that I was way under 83 MB the day I was called, and under 100 MB when I returned and ended my plan. One rep paused, and said, "Wow, most people don't do that." Another pause. "That was a smart thing to do."
I ended up getting a refund of about $600.
That's why I KNOW AT&T LIES about data usage.

fastlane says:

I've never gone over 100MB a month.
People are going to be on their death beds one day, and regret spending their entire lives on their gadgets.

GraysonIP says:

I absolutely believe that the overbilling for data usage has merit. The first month that I got my daughter's iPhone, her usage reflected on our bill as very high, so I switched her to the 2 Gig plan. I didn't understand this because she wasn't using the phone often. Without much change in activity, in the following months (after upgrading her data plan) her usage was much lower. After overpaying for several months, I finally switched back to a 200 MB plan. I certainly hope there's a resolution, and penalties to AT&T if they've been overcharging.

ermax says:

Wouldn't the best test be to disable Cellular Data for 10 days and see what ATT says? I suspect the iPhone communicates one way or another even with PUSH disabled, no email accounts, no web browsing and all that. 2MB in 10days sounds questionable though. I would love to do this set myself but 10days without data would be hard. Hahaha.

Tony says:

Yeah this is true. I've notcie larger chunks of data used when I wasn't even using the iPhone or in wifi. I contacted AT&T about this and they couldn't give me a
Clear answer. I just had my account noted so that I would be charged any overages. They also seemed to rollover some of last months data to the new billing cycle. Since I reported it i haven't seen any issues.

Tony says:

So that I wouldn't be charged with overages I mean. And no my iPhone isn't jail broken.

DRHughes says:

I have unlimited data. But I always notice it says I use more data than I did use.

Webvex says:

My current theory (thanks to some comments above) is that it's the data Apple collects. When you set up your iPhone, there's a dialog asking if you want to send "diagnostic and usage" data to Apple. The default is yes, of course. For many of us that were on unlimited, we probably either didn't notice or didn't care. However, once you downgrade to a lower plan it becomes an issue. I certainly didn't realize how much data they are collecting, and I don't like it from a privacy perspective either. Luckily, you can stop the data collections. You have to sync with iTunes, right-click on your device in the left-hand column, and then choose Reset Warnings. The next time you sync you should get the dialog where you can decline the collections. There are a few other steps if you don't get the dialog, and I had to do it a few times myself. I would suggest Googling for the Apple support document or other instructions if you want to give it a try. Even those of you still on the unlimited plan might want to check the detailed usage in your account. You might be surprised at how much data is being transferred in the middle of the night. It might also explain why some people see their battery drop overnight if they aren't on a charger. I'm crossing my fingers that this will help.

Mrjr says:

There's so much ignorance in this thread, it's painful. I'm not directing that at any one person, for sure.
And btw, @Joseph: 313,978Kb IS 307Mb (306.6Mb). 1Mb = 1024Kb.
The takeaway is clear. Tiny data plans are just like cut-rate insurance... they don't cover what you think they will. Just get a better plan.

Jaredkaragen says:

The iPhone uses data for voice/SMS connection when the cellular voice portion is overloaded/backed up. That could explain it.... But I believe it's possible. A little here and there from millions of customers makes a pretty bug chunk of cash.

Dave says:

I noticed this as soon as I changed my iPhone from unlimited data to 200 MB of data. I called AT&T several times about it only to be told they had to investigate and call me back. I never got any call backs.

Tyler says:

I noticed mine go up with no change in how I used my phone. I am on the unlimited plan still but I thought about switching to the lower plan but seeing that I was using more decided not to. Wonder if my data is bad so I can't make an informed decision on weather to switch to a lower data plan.

masterbatorium says:

Why do some jump to conclusions and assume AT&T is in the wrong here. The issue could very easily be Apple's (or a third party company that is not AT&T). A perfect example of this is Microsoft admitting that their phone leaking data was an issue with Yahoo, not the carrier.
I think there is a problem that data usage can not be easily monitored, but it is unfair to blame only AT&T as they are only one piece of the puzzle.

OmariJames says:

That's really sad AT&T is doing this.

jimmyjames says:

same thing happened to me many others are describing. had a one time data transfer of 200 or so Mb. i tried to complain to att support that this was virtually impossible. they wouldn't listen. ultimately i decided my sanity was not worth a $15 overage fee

L. Baker says:

The same thing is happening to me yet with many calls and hours spent trying to resolve the issue AT&T claims it's not a known issue.

Amanda says:

I have a samsung galaxy S. i use my main wireless internet for my phone. I dont call many people and my bill is always between 200-250 a month. I have had every bill in the past year disputed. in one case they charged me 3 times for the same plan in one month. They said my phone wont work off my wireless at home. thats odd i told them considering it connects to it and im not stupid. I was hung up on at that point. My contract is up this month and i plan on switching. So long at&t .

Abraham says:

My phone bill is about 190 to 200 sometime 500 dollars I think AT&T is cheating me, I hate AT&T

MikeO says:

For iPhone users those who have large amounts of data being uploaded in the night and being charged to your cell plan data usage, you need to go into Settings, About, scroll down to Diagnostics & Usage and open that up. There are choices to Automatically Send and Don't Send. Activate Don't Send. The Auto Send uploads data to Apple every night and uses your cell data plan, even though WiFi is available in your house. Once I did that, no more mysterious data uploads at night and no more going over data usage plan.