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AT&T boosts limit on 'unlimited' data

On the heels of a major FCC fine, the wireless carrier increases the threshold at which it starts slowing down service to 22GB of data a month, almost five times its previous cap.

AT&T's "unlimited" data plan is that much closer to actually being unlimited.

The carrier on Wednesday announced that it's drastically increasing the amount of data that customers grandfathered into its discontinued plan can use in a month before it begins to slow down, or throttle service.

CNET/Marguerite Reardon

The company posted a notice on its website telling unlimited data plan users that it will begin to slow down service when they exceed 22 gigabytes of data within a given month, until the next billing cycle.

This is a big change for customers still using AT&T's unlimited data plan. Previously, Texas-based AT&T began slowing service for customers who used more than 4 gigabytes or 5 gigabytes of data.

AT&T's change in policy comes as the second-largest mobile phone company fights two federal agencies, which have accused it of misleading consumers over its throttling policy. Earlier this year, the Federal Communications Commission said it plans to fine AT&T $100 million over the practice. And the Federal Trade Commission has filed a lawsuit against the company seeking a judgement that could help refund affected consumers millions of dollars.

AT&T's policy change is likely a maneuver to stave off these fines and sanctions. It's unclear if they will be enough for these agencies to reconsider their actions.

Neither the FCC nor the FTC were available for comment on AT&T's new policy.

AT&T had previously slowed access to the Internet for unlimited data plan users when they hit 4GB of data if using a 3G device and 5GB of data if using 4G LTE smartphones and tablets. Now, once any unlimited data subscriber uses more than 22GB of data a month, "speed reductions will occur only when the customer is using his or her device at times and in areas where there is network congestion and only for the remainder of the current billing cycle," AT&T said.

A previous version of the policy, which changed in May, slowed data speeds 24 hours a day, 7 days a week, regardless of network congestion.

AT&T began offering unlimited data plans in 2007, and it stopped offering these plans to new customers in 2010. Since that time, the company has allowed existing customers to keep their unlimited plans. But in 2011, it began a policy through which it would limit the speed of the service when customers reached a certain threshold of usage.

The FCC said it had received thousands of complaints from customers of AT&T's unlimited data plan, who said they felt misled by the company's policy. Consumers also complained that they could not cancel service without having to pay early-termination fees. The agency said that AT&T had "falsely labeled" its plans as unlimited, which is a violation of the 2010 Open Internet Transparency Rule. The FCC also alleges that AT&T failed to sufficiently inform customers of the maximum speed they would receive for their service.

Verizon and Sprint have each stopped throttling unlimited data users. T-Mobile also has a policy that slows data for unlimited data plan customers. T-Mobile's policy states that it "de-prioritizes" service for customers who use more than 21GB of data during a billing cycle. Like AT&T's policy, service is only affected in times and places where the network is congested.