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Users of grandfathered unlimited iPhone data plans will be bumped to a 2 GB capped plan with extra tethering fees if they continue to jailbreak and tether.  (Source: Gizmodo)

AT&T offers the nation's second highest data costs, and unlike Sprint and T-Mobile refuses to provide customers with unlimited data.   (Source: Koz)
Company says it's only being fair

As promised, AT&T, Inc. (T) has begun to crack down on those who tether illegally on unlimited plans.  But some customers hope that new apps may hide them from the company's purge.

The issue began last June when AT&T scrapped its $30 USD/month unlimited smartphone data plan.  In its place the company installed a cheaper plan -- $25 USD/month -- but with tiers/caps.  With the new plan you only got 2 GB of data, and had no option to purchase "unlimited" data.  AT&T also slapped on a $20 USD/month tethering fee.

AT&T softened the blow, with a grandfather clause for current customers, allowing them to enjoy unlimited data at their previous rate.

That move allowed some iPhone customers to jailbreak their phones and buy apps like the MyWi app, which allows for USB, Bluetooth, or Wi-Fi tethering for a one-time fee of $19.99.

In January, AT&T caught wind of this and issued an ultimatum to illicit tetherers on grandfathered unlimited plans, saying it would find them out and punish them.  Now it has revealed details on those punishments, which are set to begin briefly.

The company intends to send threat letters to customers.  It describes:
Earlier this year, we began sending letters, emails, and text messages to a small number of smartphone customers who use their devices for tethering but aren’t on our required tethering plan. Our goal here is fairness for all of our customers. (This impacts a only small percentage of our smartphone customer base.)

The letters outline three choices:
    1. Stop tethering and keep their current plan (including grandfathered unlimited plan)
    2. Proactively call AT&T or visit our stores and move to the required tethering plan
    3. Do nothing and we’ll go ahead and add the tethering plan on their behalf — after the dated noted in their customer notification
The crackdown will reportedly begin next week, according to 9 to 5 Mac.  

Service changes will be implemented shortly after customers receive their letters, if AT&T does not receive a response.

MyWi, arguably the most popular illicit tethering app, is vulnerable to the crackdown because it labels its traffic as tethered traffic in the same way the iPhone's standard tethering system does.  However, two other apps -- PdaNet and TetherMe -- offer a "hide" function, that disguises the identity of the traffic.

However, prolific users likely will be found out by AT&T regardless of what app they use.  Reports a commenter on the iPhoneDownloadBlog, "I used the new PDANET since the day it was released a few weeks ago. Shortly after and consistent with 4.3 upgrade I received a [warning] email from ATT."

Of course, customers could always get a bleeding edge Android smartphone on Sprint Nextel Corp. (S), who offers unlimited data at a cheaper rate than AT&T's capped plans.  AT&T, perhaps unwittingly, gave those looking to jump ship an advantage, exempting iPhone customers from its early termination fee hikes.

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By maevinj on 8/5/2011 11:21:46 AM , Rating: 1
Do nothing and we’ll go ahead and add the tethering plan on their behalf — after the dated noted in their customer notification

Can they do this? Add a paid service to your account without your consent?

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 11:25:08 AM , Rating: 2
I didn't think they could but maybe then can because technically the user is not following their terms by using tethering when they shouldn't.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 11:27:11 AM , Rating: 2
I think it would make more sense to take away their unlimited data for breach of contract unless they stopped tethering.

RE: Rea$*@?
By maevinj on 8/5/2011 11:29:09 AM , Rating: 2
That would make more sense. I guess they'd rather try to get more money than cut the revenue.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 11:35:35 AM , Rating: 2
Would they cut revenue by getting rid of the unlimited and switching to 2GB cap. I don't know the price difference.

RE: Rea$*@?
By DanNeely on 8/5/2011 3:17:14 PM , Rating: 2
yes. 2GB is $25, unlimited is $30. ATT at least spread a thin veneer of Good for Customers over their plan changes when they slapped their caps down.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 3:21:12 PM , Rating: 2
Ehhh whatever they do I bet the people this happens too will just cancel their contract without a termination fee and just head over to Sprint where there is unlimited data plans

RE: Rea$*@?
By Tommyguns on 8/5/2011 10:47:23 PM , Rating: 2
That's exactly what I plan on doing. I used about 2-4gbs a month listening to slacker, games, and browsing on my BB Bold 9000 /month. Now, because I am to cheap/busy to get internet at my new home, I tether all the time. Last month I did 4.7gb. This month, i am on the pace for 5gb.
I have had a blackberry bold with ATT for about 2 and half years now with a $30 unlimited plan. At about $100 a month, it makes total sense to dump ATT and head to sprint where i can get unlimited everything for $79+tax. Factor in I will join my brothers family plan and save another %20 helps. Oh, and I get another %20 off because sprint recognizes my employer...
And they are giving new customers who move their numbers to sprint $125.

Things holding me back is sprints lack luster 4g roll out. They are in the hood, but not in the suburbs. Also, the new BB phones aren't out yet or the Photon.
Will I get cought? Are blackberry users at risk as well? All I read is iphone this, and android that. My data plan on my bill reads:

BlackBerry® Personal with 200 Messages
Price MSG Data
$35.00 200 Unlimited

I despise VZW. Had them for 6 year$.

RE: Rea$*@?
By kmmatney on 8/7/2011 12:27:07 AM , Rating: 3
" Now, because I am to cheap/busy to get internet at my new home, I tether all the time."

This is the problem. I only tether occasionally, when I'm traveling or not near Wifi, but it's the people doing it full time ruining it for everybody...

RE: Rea$*@?
By JasonMick on 8/5/2011 11:35:04 AM , Rating: 4
I think it would make more sense to take away their unlimited data for breach of contract unless they stopped tethering.

But you're asking the wrong question, here...

The issue is that even if they prove breach of contract, does breach of contract allow companies to force customers into a second contract, which they did not agree to?

There's probably provisions in the contract that say AT&T may change your service, though, and that may be how they think they can get away with it.

However, many court decisions indicate that customers can't generally sign away their rights, which would, in essence, be what an undefined (fully modifiable) contract would lead to.

Ultimately, though, I wouldn't be surprised to see a class action lawsuit arise out of this, though...

RE: Rea$*@?
By corduroygt on 8/5/2011 11:38:15 AM , Rating: 2
You are right, I think they'll either offer you the option to pay more or they'll terminate your account to avoid any class action lawsuits. This way they're not "forcing" anything since they're just terminating a breached contract or signing another one with both parties' consent.

RE: Rea$*@?
By mmatis on 8/5/2011 1:51:40 PM , Rating: 2
You're all acting as if you believe that Rule of Law still exists. Let me assure you that has NOT been the case in the US for QUITE some time.

RE: Rea$*@?
By tastyratz on 8/6/2011 7:07:02 PM , Rating: 2
Think of Pay Per View. You are not "signed up" for the movie but elect to receive a service in the same fashion. AT&T has stated that tethering costs money and notified customers. By using tethering AFTER notification they are automatically signing you up. This is well within reason given the notification even if I do not fully agree with this particular one.

RE: Rea$*@?
By theapparition on 8/8/2011 4:37:21 PM , Rating: 2
The issue is that even if they prove breach of contract, does breach of contract allow companies to force customers into a second contract, which they did not agree to?

Technically they send you a new contract.

What happens is they will send you a change to your TOS. If you don't accept those terms, the contract is null and you are free to switch providers, with no ETF. People have the notion that if thier provider changes terms, they are stuck with it. Not true. All you have to do is contact them and tell them you don't agree. The service becomes canceled at that point.

When they send out those TOS change notices, they indicate that lack of a response constitutes acceptance. All anyone has to do is read thier mail and act appropriately.

RE: Rea$*@?
By MrBlastman on 8/5/2011 11:50:07 AM , Rating: 1
Yes, they can. Why?

They send you a letter (as they will do) that says if you do not act by X date, it is construed as silent consent to add the service to your account.

This is what they are doing. The burden will fall on you to prove that you did not receive the letter.

RE: Rea$*@?
By Devilpapaya on 8/5/11, Rating: 0
RE: Rea$*@?
By MrBlastman on 8/5/2011 1:19:40 PM , Rating: 2
If they don't say no, they only have themselves to blame...

This is a bit different than date rape though. :P

RE: Rea$*@?
By Devilpapaya on 8/5/2011 1:24:10 PM , Rating: 2
Granted it is different, but the law is still pretty clear (at least as i've been lead to believe in my basic business law classes :P) that 'slience as consent' is only legal in very limited applications. I could see them maybe charging you a fee (like an overage fee gets charged if you go over minutes/data/whatever) but altering your monthly payment plan seems a little sketchy.

RE: Rea$*@?
By MrBlastman on 8/5/2011 2:02:00 PM , Rating: 2
I think the position they are taking is:

"Oh, you want to cheat us out of fees... fine! There, now your bill is changed. Oh... you have a problem with it? Well, too bad. Sue us if you think you can."

They want to see if someone will call their bluff. When they do, I'm sure it will be an interesting case to watch.

I myself think the whole practice stinks.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 2:05:38 PM , Rating: 2
The whole practice might stink but if people would just follow the TOS they agreed to then this would not be an issue

RE: Rea$*@?
By MrBlastman on 8/5/2011 2:18:04 PM , Rating: 2
Exactly. Part of the dilemma though is consumers are increasingly facing pages of terms listed in the TOS and most of the time they either are too lazy or neglect to read all of them.

I believe consumers should start a new movement--signing the terms after crossing out/x-ing out areas or chunks they disagree with and inking at the bottom that the provider has 30 days to decline otherwise they accept the signed document as final. I'm sure practices such as this would really raise their legal costs. :)

I'd love to see a consumer catch a service provider in this kind of trap and see it argued in court. We the consumer should be afforded these same types of protections that the provders try to lever on us.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 2:42:11 PM , Rating: 2
I'd love to see a consumer catch a service provider in this kind of trap and see it argued in court.

Well you try it and tell us how it turns out :D

RE: Rea$*@?
By Devilpapaya on 8/5/2011 2:53:46 PM , Rating: 2
I think it would get nulled if the changes weren't noterized, and again, silence can't be considered consent unless previously agreed upon, which is probably in the TOS somewhere in the case of ATT, but doing what you're suggesting would just get the contract nullified.

RE: Rea$*@?
By MrBlastman on 8/5/2011 3:09:41 PM , Rating: 2
So there you have it. A way to give you a back door to your phone contract without paying early termination fees--if as you suggest it would nullify things. I am pretty darned sure the phone company wouldn't read or pay attention to these things--or at least there would be a reasonable chance it would slip through the cracks.

Though, I'm sure if they did read it, the form would be sent straight to their legal department where they would promptly deny it with boilerplate.

RE: Rea$*@?
By bitterman0 on 8/5/2011 2:06:56 PM , Rating: 2
I was about to respond in kind, too.

But coming to think of it, this happens all the time. Consider your cable TV provider. They jack up your monthly service fee every year or so, perhaps even switching you to a different plan once in a while, and all they have to do is to send you a notice of the intended action. If you don't respond, they simply continue as planned.

That should be spelled out in the TOS/contract, IMO.

RE: Rea$*@?
By cjohnson2136 on 8/5/2011 2:12:29 PM , Rating: 2
Might want to check because that clause is in my TOS for cable

RE: Rea$*@?
By Bad-Karma on 8/5/2011 7:25:04 PM , Rating: 2
This is a bit different than date rape though

I don't know, getting bent over without your consent is pretty much rape no matter how you look at it.

RE: Rea$*@?
By Sazabi19 on 8/5/2011 12:02:49 PM , Rating: 2
I believe that they can do this as long as the customer is notified of the change whether the customer doecides to do anything about it or not is up to them. If the customer doesn't like the new terms (under normal circumstances) has the legal option to opt out of a contract with no penalties. With people tethering outside of their contract (breaking their contract) AT&T may be able to hold them responsible. I think a better solution would be to institue a 2gig cap and charge them overage fees for how much data is used after that, then offer the customer to add the tethering plan if they wish (either keeping their unlimited plan or swapping to a tiered plan). People who void their contract and complain make me laugh, companies are expected to follow it and have to pay huge sums when they are found not to be doing so, why are you (ambiguous) any different?

RE: Rea$*@?
By senbassador on 8/5/2011 1:05:05 PM , Rating: 2
Yes, they can. They can change the terms of your contract at any moment, and you then have 30 days (or something like that) to cancel your contract with them (at no penalty cost by either party). You also have the right to cancel your contract with them at any time and pay the early termination fee if you feel that it would be cheaper to pay it and go with someone else.

The only questionable thing (legally) is perhaps them not doing their best letting you know about your right to cancel within 30 days (or maybe they do, I never had AT&T try to cancel my contract with them).

My best guess is that AT&T is banking on a lot of people not knowing, or not bothering to, cancel their account, sort of like companies do with rebates.

RE: Rea$*@?
By maevinj on 8/5/2011 3:28:23 PM , Rating: 2
why'd I get down-rated? I was asking a legit question. I wasn't trolling.

Tether illega#*!?
By mherlund on 8/5/2011 11:23:39 AM , Rating: 2
AT&T, Inc. (T) has begun to crack down on those who tether illegally on unlimited plans.

I could be wrong, but wouldn't this just be a breach of contract and not really illegal?

RE: Tether illega#*!?
By JasonMick on 8/5/2011 11:40:09 AM , Rating: 2
I could be wrong, but wouldn't this just be a breach of contract and not really illegal?

Haven't you ever seen South Park's "Human CENTiPAD"?

Signed contracts are legally binding, so yes it is illegal in a civil sense.

Can you go to prison for it? No, probably not.

Can AT&T try to drop your service or pull other shenanigans, under the law? Yes.

That's not to say whether what these individuals are doing is right or wrong. But if they're not happy with the TOS, customers should either seek to lobby a company to change its TOS or pursue legal avenues to try to review the offensive provision.

For now AT&T has the dominant position, legally, as it has a signed contract the customers are clearly violating.

RE: Tether illega#*!?
By Flunk on 8/5/11, Rating: 0
RE: Tether illega#*!?
By JasonMick on 8/5/2011 11:59:51 AM , Rating: 2
That Southpark episode is a parody, contracts that are illegal are unenforceable. Breaking a contract is not illegal per say but it does allow the other party to do whatever the contract has stated as the penalty for breaking the contract.

Of course, but it made a serious point, that some contracts ARE legally binding and enforceable by law.

Again, this contract is likely legally enforceable, in terms of terminating users, but switching them to a new plan is questionable...

It's still not illegal to violate the terms of a contract.

You need to brush up on contract law. It is very much illegal in a civil sense to violate a contract. If it wasn't companies couldn't terminate your service if you violated their contracts.

Of course punishment for civil law violations is only determined by the desire to enforce, so an "illegal" contract violation may, of course, be overlooked or ignored.

Contracts have the power of law, unless they are found to be illegal (as the first part of your comment suggests).

Some contracts can even carry criminal charges, say protections on corporate/government secrets.

RE: Tether illega#*!?
By bplewis24 on 8/5/2011 5:37:59 PM , Rating: 1
It's not illegal, it's a breach of contract. He is correct, there is nothing illegal about a breach of contract. Contracts can be enforced in court, but that doesn't mean it's illegal to breach a contract.


RE: Tether illega#*!?
By Warwulf on 8/5/2011 12:17:01 PM , Rating: 2
Couldn't the arguement be made that, since you're not using the network iin accordance with the terms, that constitutes unauthorized use of a computer/network... and hence a criminal offense? They've been making the same arguement in cases of things like Facebook TOS violations and other BS.

Can they do this?
By hkscfreak on 8/5/2011 12:50:53 PM , Rating: 2
Yes they can, it seems like they present you with 3 choices and you are backed into a corner, but there is a hidden 4th choice. By law, if any terms of the contract are changed, you have a right to terminate the new contract within 14 days (I think, someone correct me if I'm wrong) and not incur any penalties.

RE: Can they do this?
By cjohnson2136 on 8/5/2011 1:28:09 PM , Rating: 2
This is true but the terms differ from state to state

RE: Can they do this?
By dxf2891 on 8/5/2011 2:59:07 PM , Rating: 3
Don't forget choice #4, f0ck you, I'm going to Sprint.

I do not understand
By mianmian on 8/7/2011 2:07:42 PM , Rating: 2
What's the difference of using a cell phone to browse website and using a tethered computer to do so?

RE: I do not understand
By cjohnson2136 on 8/8/2011 10:55:13 AM , Rating: 2
If you are just browsing websites I don't think there is much a difference. But you are more likely to do more data intensive activities on a laptop then a cell phone. That is the justification for tethering fees. On an unlimited plan it makes sense, but not a tiered plan.

By Lazarus Dark on 8/5/2011 4:44:13 PM , Rating: 3
I'm not a big fan of government regulation except when it comes to these large corporations, because without regulation, we know they would all try to own our souls.

We need to stop thinking of these as Cell phone carriers. We all know cell calls will go the way of landlines within the decade as people start to realize that VOIP calls can be made for cheaper, and it should be none of the carriers business how I use the data package, even if I'm using voip. They should be reclassified as Wireless Data Providers and be treated similar to wired data providers.
I have ATT DSL, despite my hatred of ATT, simply because similar speed costs twice as much via Comcast, leaving me no other choice. Now, imagine if ATT said I had to pay an extra $30 a month just so I could use a wifi router on my dsl or use voip. That wouldn't fly. Why do we accept this from the wireless side? Data is data is data: quite frankly I find it a violation of my privacy for a wireless carrier to try to track how I am using the data service they provide. It's none of their damn business how I use the data access they give me, so long as I am not violating any federal laws.

I would accept that they want to put everyone on capped data plans, fine. But if put on a capped plan, they can not charge extra for tethering, because 2GB is 2GB no matter what device I am using, which again is none of their freaking business.

And I am sick of hearing you can go to another carrier. Really? in case you hadn't noticed we are very nearly at a duopoly. Which means they need to be regulated. Currently, whatever one does to screw the customer, the other does as well, despite being competitors, they often seem to be making decisions together.

And people...
By MrBlastman on 8/5/2011 11:18:01 AM , Rating: 2
Want AT&T to be allowed to merge with T-Mobile... Why?

Oh that's right, they've been bought and paid for with incentives, kickbacks, strippers or whatever else creative thing that can be thought of.

ATT is crazy!
By Roy2001 on 8/5/2011 1:30:32 PM , Rating: 2
I am on 2GB/mon plan, I can decide how to use my 2GB data, why ATT threat me?

I will say byebye once my current contract expired. ATT sucks.

sign of things to come
By IlllI on 8/5/2011 2:00:43 PM , Rating: 2
if att gets to buy t-mobile. between att and verizon, they'll own close to 80% us market. there will hardly be any choice left.

Charging for tethering
By Curt4Computers on 8/6/2011 2:06:26 PM , Rating: 2
Ok, I'll concede that it makes sense for them to charge extra for tethering on Unlimited plans. But how can they justify charging for tethering on tiered plans? After all, you are esentially purchasing x amount of data. Why do they claim to have a right to regulate wether you use it for your phone or your laptop. If you ARE using it for your laptop, isn't it likely that you would purchase a plan with a higher cap in the first place? And then they are going to charge you a tethering fee on top of THAT? I wish I could get away with double charging for the same service in MY business!!!

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