U.S. regulator questions Verizon plan to slow data speeds for some

By Alina Selyukh

WASHINGTON (Reuters) - The top U.S. telecommunications regulator said on Wednesday he is "deeply troubled" by Verizon Communications Inc's plan to slow data downloads for some high-speed wireless customers remaining on the older unlimited data plans.

Verizon, the largest U.S. wireless carrier, stopped offering unlimited data plans in 2012 and last week said it will begin slowing services for the top 5 percent of data users who are on such data plans in places where the network is experiencing high demand.

The policy is already in effect for unlimited subscribers on the 3G network but would now be expanded to the higher-speed 4G network.

But Federal Communications Commission Chairman Tom Wheeler raised concerns about the plan on Wednesday.

"I am deeply troubled by your July 25, 2014 announcement that Verizon Wireless intends to slow down some customers' data speeds on your 4G LTE network starting in October 2014," Wheeler wrote in a letter to Verizon Wireless President and CEO Daniel Mead released by the FCC.

"It is disturbing to me that Verizon Wireless would base its 'network management' on distinctions among its customers' data plans, rather than on network architecture or technology. ... I know of no past Commission statement that would treat as 'reasonable network management' a decision to slow traffic to a user who has paid, after all, for 'unlimited' service."

A Verizon Wireless spokesman said the company's officials will officially respond to Wheeler's letter once they have received and reviewed it.

"What we announced last week was a highly targeted and very limited network optimization effort, only targeting cell sites experiencing high demand," the spokesman said. "The purpose is to ensure there is capacity for everyone in those limited circumstances, and that high users don't limit capacity for others."

Although No. 3 and No. 4 carriers Sprint Corp and T-Mobile US Inc continue to offer some versions of unlimited data plans to new subscribers, U.S. wireless carriers have been working to shift their increasingly data-hungry subscribers onto tiered pricing plans, which charge customers for specific amounts of data they agree to consume.

For Wheeler, the letter represented another push against an Internet service provider (ISP) as he seeks to establish himself as a strong defender of web users' interests who would punish ISPs whose business practices may hurt consumers or competition.

His efforts follow the FCC's controversial proposal of new "net neutrality" rules that guide how broadband providers manage web traffic on their networks, which has drawn fire from consumer advocates, the public and some Internet companies.

In Wednesday's letter, Wheeler also posed to Mead several questions about the plan, including the rationale to treat consumers differently depending on their data plans, the reasons behind extending speed reduction from the slower-speed 3G network to the more efficient high-speed 4G LTE network, and how Verizon would justify the plan under its current regulatory obligations, including those meant to protect "net neutrality."

(Reporting by Alina Selyukh; Editing by Jonathan Oatis and Grant McCool)