I Experienced The Dreaded AT&T 'Throttling' Firsthand

Last month, when I was in California for a work trip, my phone suddenly became useless. Even though I was in downtown San Francisco, the data connection was so slow that it was pretty much impossible to download email, use apps, browse the Web or load photos on Instagram.

I was being "throttled." AT&T had deliberately slowed down my data speed because I used more than five gigabytes during a billing cycle, even though I have had an unlimited data plan since 2009. (AT&T no longer offers unlimited data plans, but I have renewed my contract, so I've been allowed to keep it.)

AT&T began throttling in 2011. But the policy was thrust into the spotlight this week, when the Federal Trade Commission sued the telecom giant for slowing data speeds, sometimes by more than 90 percent, for unlimited data customers without "adequately disclos[ing]" the policy.

“AT&T promised its customers ‘unlimited’ data, and in many instances, it has failed to deliver on that promise,” FTC Chairwoman Edith Ramirez said in a statement announcing the lawsuit. “The issue here is simple: ‘unlimited’ means unlimited.”

AT&T shot back, calling the suit "baseless" and pointing to a press release and "2,000" subsequent news articles when the company made the changes in 2011.

"[B]efore any customer is affected, they are also notified by text message," Wayne Watts, AT&T's senior executive vice president and general counsel, said in a statement Tuesday.

The FTC said AT&T has throttled 3.5 million customers a total of 25 million times. I'm one of those customers.

Here's the thing. Even though I've gone over five gigabytes in four of the last five months, I've only gotten one text message from AT&T warning me that I was approaching the threshold. That was in May. Last month, my phone slowed without warning.

When I reached out to AT&T about why I only got a text message that first time, and I didn't get a text message each time I approached five gigabytes in a month, the company pointed to an obscure page on its website informing customers that their "speeds may be reduced without another text message reminder."

The company also said I had received a notice with my bill in summer 2011 announcing the changes. But as the FTC points out in its lawsuit, the notice doesn't "disclose the degree to which the customers’ data speed would be reduced,
and the impact that the reduced speed would have on customers’ ability to use their device."

"We stand by the statement from earlier this week," Mark Siegel, AT&T's executive director of media relations, told The Huffington Post in a phone call. "And we stand by what is available on our public website about how we handle our unlimited data customers."

AT&T could easily send texts each time customers approach the five gigabyte threshold. After all, the company sends texts when your bill is due, when it's paid, if you are going over your voice minutes and when it's added a cell tower in your area. Or it could send an email. I've received at least seven emails from AT&T this month, five for promotions or trying to get me to upgrade.

But throttling is something AT&T appears to want to keep quiet. Researchers hired by the company to conduct focus groups about throttling suggested not talking too much about it, according to the FTC lawsuit.

From the FTC lawsuit:

The researchers observed that “[t]he more consumers talked about it the more they didn’t like it.” This led the researchers to advise that “[s]aying less is more, [so] don’t say too much” in marketing communications concerning such a program.

AT&T says it throttles customers to manage network congestion. But the FTC says throttling happens even when the network isn't congested. AT&T doesn't throttle those people on its other data plans who use significant amounts of data, the FTC says in the lawsuit.

AT&T seems to use throttling to encourage unlimited data customers to sign up for tiered data plans, which make them pay for as much data as they use and can be more expensive for heavy users. Those who quit AT&T's unlimited data plans, the FTC points out, have been hit with early termination fees in the hundreds of dollars.

Verizon also has customers holding onto unlimited data plans, even though it doesn't offer them anymore. The company announced over the summer that it would throttle heavy unlimited data users during peak times, but backed off after receiving widespread criticism, including from the chairman of the FCC.

Unlimited data customers are not as valuable to the companies as those with tiered plans because they will pay the same each month regardless of how much data they use, forever. Data use is predicted to explode to 9.1 gigabytes a month in 2018, from 1.4 gigabytes per month last year, according to Cisco.

Bekim Ukperaj, who works at a golf course in Stamford, Connecticut, and admitted he uses his phone "a lot," said he regularly exceeds five gigabytes of monthly data and is throttled. AT&T said it sent Ukperaj two text messages in January 2013 as he neared the data threshold, and included the throttling notice in his bill in 2011. But Ukperaj said he doesn't remember any notification that he was nearing five gigabytes. He now uses a tool on his LG G2 smartphone to alert him when he's getting close.

"A warning would have been nice in all those previous months I didn't alert myself," Ukperaj said, adding that sometimes his phone was useless for weeks while it was throttled. Ukperaj said that when he renewed his unlimited data contract in December, AT&T representatives didn't warn him that he could be throttled. "You'd think that if you renewed your contract, they'd say something more about the data limiting," Ukperaj said.

AT&T's 4G LTE network typically has download speeds of five to 12 megabits per second (Mbps), according to the FTC. When I was throttled in September, my download speed was cut to a slow 0.17 Mbps, rendering most of the functions on my smartphone useless.

Results of a speedtest while being throttled (left) and before being throttled (right).

"You're looking at data speeds that pretty much predate the smartphone era," Bill Menezes, an analyst who specializes in mobile networks at Gartner, the technology research firm, said when he reviewed the results of the speed test I conducted while being throttled in September.

Frank Guido, a Staten Island, N.Y.-based photographer, was so frustrated with his throttled data speed of 0.46mbps that after dealing with it for only two days he called AT&T and switched to a data plan he now shares with family.

"I'm away from home days at a time for my job so I can't live on Edge speed," he said, referring to the older, slower network.

He was an AT&T unlimited data subscriber who regularly went over five gigabytes a month, though he only first noticed his phone's data connection was slow over the weekend. He said that he has never received a text message or an email telling him he'd get throttled if he went over a certain number of gigabytes.

But after the FTC lawsuit was announced, he called to switch back to his unlimited data plan. Because AT&T no longer offers the plan, his request has to be approved by management. He'll find out in early November if AT&T approved the switch.

Tim Cook Comes Out As Gay In Powerful Businessweek Essay

Apple CEO Tim Cook came out as gay in a powerful essay for Bloomberg Businessweek.

In the essay, published Thursday, Cook said that he has never denied being gay, but has not publicly discussed his sexuality until now: "So let me be clear: I’m proud to be gay, and I consider being gay among the greatest gifts God has given me."

He described how his sexuality has given him an acute social perspective.

Being gay has given me a deeper understanding of what it means to be in the minority and provided a window into the challenges that people in other minority groups deal with every day. It’s made me more empathetic, which has led to a richer life. It’s been tough and uncomfortable at times, but it has given me the confidence to be myself, to follow my own path, and to rise above adversity and bigotry. It’s also given me the skin of a rhinoceros, which comes in handy when you’re the CEO of Apple.

The revelation comes just days after Cook advocated on behalf of lesbian, gay, bisexual and transgender rights in his home state of Alabama.

"[Alabama is] still too slow on equality for the LGBT community," he said, per the Associated Press, while calling for laws protecting people based on sexual orientation and gender identity. "Under the law, citizens of Alabama can still be fired based on their sexual orientation. We can't change the past, but we can learn from it and we can create a different future."

Cook's sexuality has been a point of speculation for quite some time. Gawker reported that Cook was gay back in 2011 before he succeeded Steve Jobs.

Since then, Cook himself has seemingly dropped hints about his sexuality. Last year, during a speech about human rights at Auburn University Cook discussed the discrimination he faced as a young person, according to ValleyWag.

"Since these early days, I have seen and have experienced many types of discrimination and all of them were rooted in the fear of people that were different than the majority," he said.

However, since the 53-year-old had not publicly come out, the question still remained. In May, the New York Times ran a story titled "Where Are The Gay Chief Executives?" and had to subsequently clarify their definition of "openly gay." CNBC's Simon Hobbs made headlines for mistakenly saying Cook was "fairly open" about being gay during a live segment back in June.

Head over to Businessweek to read Cook's full essay.

Fed Ends Stimulus Program With Economy Still On Shaky Ground

Janet Yellen and the Federal Reserve just declared the U.S. economy well enough to leave intensive care, though it is not yet the picture of health.

The Fed announced on Wednesday that it was ending a two-year stimulus program designed to keep interest rates low and boost the economy. The program -- known as "quantitative easing," or "QE3," for the fact that it was the third round of such stimulus since the financial crisis -- involved buying billions of dollars of bonds each month. The central bank has been cutting back on these purchases with every Fed meeting since December 2013. On Wednesday it said it was making its last such purchase this month.

In pulling away support for the economy, the Fed is taking a chance that recent signs of economic strength are more reliable than recent signs of weakness. On the one hand, unemployment has tumbled to 5.9 percent, the lowest in six years, and employers have added more than 200,000 jobs per month so far this year. GDP growth jumped at a 4.6 percent annualized rate in the second quarter. Gasoline prices are at their lowest in four years.

On the other hand, wages have stayed stubbornly flat, and much of the drop in unemployment has been due to workers checking out of the labor market, meaning they're no longer counted as unemployed. Financial markets have been turbulent lately, and economies around the world seem to be teetering on the edge of recession.

One of the Fed's policy makers, Minnesota Fed President Narayana Kocherlakota, dissented from the Fed's decision, arguing the economy was still too weak for the Fed to end QE3. He also argued that the Fed should have shown more alarm about the prospect of low inflation.

Still, in announcing its decision, the Fed sounded fairly optimistic about the economy, noting the job market's recent good news and saying that consumers and businesses have been slowly increasing their spending.

The Fed also chose to look on the bright side of one ominous development in the economy: Inflation is still lower than the Fed would like it. Low inflation might sound great to people dealing with rising food prices, but if prices generally stay too low for too long, that risks "deflation," or falling prices. When deflation happens, people stop spending while they wait for prices to fall further, and the economy suffers. See Japan in the 1990s or the U.S. during the Great Depression.

The Fed kept pumping stimulus into the economy in one way: It kept its target for a key short-term interest rate near zero and promised to keep it there for "a considerable time." This interest rate, the federal funds rate, which influences other borrowing costs throughout the economy, is the Fed's traditional policy tool for slowing down and speeding up the economy.

When zero-percent interest rates weren't enough to help an economy gutted by the financial crisis and Great Recession, the Fed turned to the extraordinary measure of buying up bonds to drive interest rates even lower. That bond-buying has left the Fed with a balance sheet worth $4.48 trillion, up from less than $1 trillion before the crisis.

The Fed's balance sheet has quadrupled in size.

What remains to be seen is the effect of the program's end on the economy and financial markets. The Fed has been warning of the end of QE3 for several months, giving markets time to adjust, and stock prices have recently soared to record highs despite the looming end of QE3.

As for the economy, interest rates have stayed relatively low even as the Fed has cut back on bond purchases. The rate on a 30-year mortgage was recently just a little more than 4 percent, up from a record low of about 3.35 percent, set just as the Fed was beginning QE3, according to monthly data from Freddie Mac.

Interest rates are still relatively low.

Fed officials have long maintained -- or hoped, anyway -- that the central bank's enormous holdings of bonds will keep helping the economy even when it stops buying more.

Interest rates rise as bond prices fall, and as long as the Fed is sitting on a mountain of relatively low-risk bonds, then bond prices should stay high, and investors will still be forced to go buy riskier stuff like corporate bonds and stocks.

The stock market, in fact, has been one of the most obvious winners of the Fed's bond-buying program. Stock prices fell on Wednesday after the Fed's announcement, but not by much. The Dow Jones Industrial Average was down about 50 points, or about 0.3 percent, about 20 minutes after the Fed's announcement. The S&P 500 was down about half a percentage point.

Some Fed officials have fretted publicly about the unwanted side effects of their easy-money programs, including pumping up market bubbles and filling the coffers of the 1 percent while not doing much for the other 99 percent. Some Fed officials and economists have also been skeptical that QE was worth such risks. Many on the Fed now seem more inclined to try to use other tools to help the economy.

The Workers Making Sure The NYC Subway Is Ebola-Free

The people who clean the subways might be New York City's unsung heroes. They work at all hours, power-washing urine from platforms, putting themselves in harm's way to clean tracks and mopping the train car floors and seats that millions of people use every day.

Still, workers were disconcerted by the news that Craig Spencer, the doctor who tested positive for Ebola in New York City on Thursday, rode the A, L and 1 subway lines the day before he was diagnosed. After all, they’re the ones who have to clean the trains on which Spencer travelled.

"It's a time for caution, a high level of caution," said John Samuelsen, president of the Transportation Workers Union Local 100, which represents Metropolitan Transportation Authority workers.

Samuelson told The Huffington Post that the biggest concern for transit workers right now is making sure they have the right protective gear for cleaning up hazardous waste. The union is advising workers to do their jobs and be professional, but to challenge any supervisor who tells them to deal with infectious waste without protective equipment.

The risk of any transit worker contracting Ebola is relatively low. The disease is not airborne, and it’s only spread through bodily fluids. For someone to catch it, they would have to actually come in contact with something like mucus or vomit from an infected person.

Bodily fluids weren’t reported on any of the subway lines Spencer rode on Wednesday, according to the MTA.

That said, uncomfortable cleanups are all too common on New York City's busy subway system.

"This is nothing new for transit workers," Samuelsen said.

Indeed, whoever ends up cleaning the subway will be well-prepared. Transit workers are trained regularly on how to deal with emergencies. Moreover, the MTA already has procedures in place for cleaning up infectious waste in the transit system, including isolating the bus, train car or subway where the waste is found and providing protective equipment and training to the people cleaning it up. The MTA has added extra levels of protection for workers cleaning the places where Spencer came in contact with the system.

“Based on advice from health experts, the MTA has updated the protocols to ensure employees are issued nitrile gloves, use a 10 percent bleach solution for disinfection, and double-bag any potentially infectious waste,” according to a statement from the agency.

In addition, the TWU Local 100 union released a statement Thursday saying that its director of occupational health, Dr. Frank Goldsmith, is “closely monitoring the situation."

The people who keep the subway humming work under a variety of strange conditions that would be foreign to most New Yorkers, according to Robert W. Snyder, the author of Transit Talk: New York Bus and Subway Workers Tell Their Stories. Their hours can be erratic. They’re in contact with many more people every day than most of us are. Some of their jobs are “industrial” and can involve dangerous conditions. Amid all of this, these workers are also expected to maintain a happy face for customers, Snyder told HuffPost.

(This is confirmed by just one look at the union's website, which is currently advertising a workshop called “Dealing with Difficult People.")

Transit workers are "often seen as invisible unless something goes catastrophically wrong,” said Snyder, who is also a professor at Rutgers University’s Newark campus.

That dynamic was on display earlier this month, when passengers wrote in anger to various news outlets about a used condom that had been hanging from a handrail on the F line for weeks. An MTA spokesman told Gothamist that he wasn’t necessarily surprised workers had missed the condom, which was relatively high up, because they’re so focused on cleaning the floors and seats of the train.

Despite the stressful conditions of transit work, people still flock to the job because “it remains one of the few jobs in the city where an ordinary person with an ordinary education can build a decent life with decent pay,” Snyder said.

Transit workers who clean the subway make about $25 an hour, according to data provided by the union. MTA workers also get dental and medical benefits, as well as perks like two weeks of paid maternity and paternity leave.

That may be part of the reason that, so far, transit workers and organizers haven’t used the Ebola panic to highlight the difficulties of the work. By contrast, earlier this month, airplane cleaners and other LaGuardia airport workers addressed Ebola in a strike that was organized with the help of the Service Employee International Union.

Though the LaGuardia protest dealt with working conditions more broadly, the Ebola outbreak offered a good opportunity to highlight those conditions, since the workers cleaning airplane cabins regularly come into contact with passengers’ bodily fluids.

Samuelsen added that his organization was in constant communication with workers and the MTA to ensure employees are working safely.

"We're not going to put ourselves in harm's way," he said.

Brace Yourself: Ugg Season May Be Even Bigger Than Usual This Year

Each year as the temperature dips, women across the country turn to their closets and dig their Ugg boots out of hibernation. Others head to stores to score a pair of the squat sheepskin booties in preparation for a chilly winter.

This year the Ugg frenzy may be even bigger than usual. Sales at the Ugg brand rose nearly 24 percent last quarter to $417 million, compared to $337 million for the same period the year prior, parent company Deckers reported Thursday. The spike was due to higher wholesale sales, online sales and new retail store openings worldwide.

And now, Ugg is about to enter its prime season.

"With temperatures turning cold in recent weeks, sell-through of weather boots and classics have gained pace across the majority of our markets," Deckers chief executive Angel Martinez said on a conference call with analysts on Thursday.

Ugg's upcoming product lines are "as compelling as we have ever seen for the company," Sam Poser, an analyst at Sterne Agee, wrote in a note to clients on Friday. He added that Ugg's reaping the benefits of favorable fashion trends, as shoppers search the aisles for comfy clothes like stretchy leggings and oversized sweaters.

However Ugg's holidays turn out, "Ugg Season" will remain. The annual donning of the Uggs has even made its way into memes, like "Girls be like."

Meanwhile, Ugg's plan to diversify its offerings seems to be working. Ugg is now selling more items that aren't dependent on cold weather. It launched a home goods line in October, offering an assortment of sheepskin area rugs, knit pillows and floor poufs. There's also Ugg's loungewear line, a casual clothing label. On the call, Martinez said that Ugg's home and loungewear businesses are still "small but burgeoning" and early results have been "very strong." Ugg will be pushing both lines hard through the holidays.

In an attempt to tell customers Ugg sells more than just shearling boots, the brand launched an advertising campaign in August with the tagline "THIS IS UGG," featuring sketch artist Langley Fox Hemingway and New England Patriots quarterback Tom Brady.

But until those lines get bigger, Ugg remains a slave to the elements. According to a report from Nomura Securities, Deckers is the best example of a company that's exposed to weather risk, something it could never hope to control. So far, the climate has treated Deckers, which also owns footwear brands Teva and Sanuk, quite well this year.

"Despite the mild weather conditions over the last two winters, this year was more seasonably cool and snowy in many parts of the U.S., which had a substantially large impact on companies with a great deal of cold weather product including Deckers," Nomura analyst Bob Drbul wrote in the report.

Company Finds Out The Hard Way It's Illegal To Pay $1.21 An Hour In America

This takes egregiously low wages to a whole new level.

A Silicon Valley company that digitizes images said Thursday that an "administrative error" led to it paying eight workers flown in from Bangalore, India just $1.21 an hour to work 120-hour weeks installing computers in the company's headquarters.

Electronics For Imaging paid the workers $40,000 in back wages and overtime and a $3,500 fine after the U.S. Department of Labor investigated the payroll violation based on an anonymous tip, a department official told The Huffington Post.

"These folks were not only not getting time-and-a-half when working extremely long hours, they weren't making the basic minimum wage," Michael Eastwood, assistant district director for the Labor Department's San Francisco division said.

In a statement, the company said it didn't realize it was illegal to pay workers temporarily in the United States the same wages they earn in their home countries. The $1.21 was equivalent to what the employees made in Indian rupees.

“We unintentionally overlooked laws that require even foreign employees to be paid based on local U.S. standards,” the company said in a statement.

Eastwood said the company also failed to keep documentation of the hours worked by the Indian employees. Though the workers were only owed $20,000 in back pay and overtime, regulators doubled that amount to $40,000 in the settlement to compensate for damages.

The company blamed an “administrative error” and said it took steps to ensure it would not occur again.

David Lindsay, a spokesman for the company, told HuffPost the labor violation occurred last year, and that the back wages, overtime and fine had already been paid. Eastwood confirmed that all dues were paid in August.

Electronics For Imaging earned a total net income of $109.11 million last year, up from $83.27 million in 2012. The stock price has climbed steadily over the last five years:

Wage theft is nothing new in the Silicon Valley region. Last year, Bloom Energy Corporation was forced to pay out nearly $64,000 in back pay and damages to 14 workers from Mexico who were paid just $2.66 an hour.

"Unfortunately, we do see a high level of wage theft violations," Eastwood said. "But we want to send a clear message that the Department of Labor is here and we are vigorously enforcing the Fair Labor Standards Act."

This story has been updated with a quotes from the U.S. Department of Labor