The Federal Trade Commission today said it “has moved to stop Internet service provider Frontier Communications from lying to consumers and charging them for high-speed Internet speeds it fails to deliver.”
Frontier was sued by the FTC in May 2021, and on Thursday, it agreed to a settlement with the FTC and district attorneys in Los Angeles County and Riverside County who represented the people of California. Frontier must pay $8.5 million to California “for investigation and litigation costs” and another $250,000 that will be distributed to Frontier customers who were harmed by Frontier’s alleged actions.
Frontier must also make changes, such as letting customers cancel service at no charge and “discount[ing] the bills of California customers who have not been notified that they are receiving DSL service that is much slower than the highest advertised speed,” the FTC said.
“Frontier lied about its speeds and ripped off customers by charging high-speed prices for slow service,” said FTC Bureau of Consumer Protection Director Samuel Levine. “Today’s proposed order requires Frontier to back up its high-speed claims. It also arms customers lured in by Frontier’s lies with free, easy options for dropping their slow service.”
The settlement is pending a judge’s approval in US District Court for the Central District of California. The FTC approved the proposed order in a 4-0 vote. Frontier did not admit or deny the lawsuit’s allegations.
Saying the FTC’s complaint “included baseless allegations and disregarded important facts,” Frontier said today that it “settled the lawsuit in good faith to put it behind us so we could focus on our business.”
Slow, inconsistent DSL
The lawsuit pertains to Frontier’s claims about its DSL Internet service, which is much slower than fiber-to-the-home. DSL speeds also vary significantly by location based on how close a customer’s home is to the provider’s infrastructure.
The FTC said the proposed order will “require Frontier to substantiate its Internet speed claims at a customer-by-customer level for new and complaining customers and notify customers when it is unable to do so; require Frontier to ensure it can provide the Internet service speeds it advertises before signing up, upgrading, or billing new customers; [and] prohibit Frontier from signing up new customers for its DSL Internet service in areas where the high number of users sharing the same networking equipment causes congestion resulting in slower Internet service.”
Moreover, Frontier must “notify existing customers who are receiving DSL Internet service at speeds lower than was advertised and allow those customers to change or cancel their service at no charge.”
While customers will get some financial relief and flexibility, many are still stuck in areas where Frontier DSL is the only choice. “Many of the subscribers to Frontier’s DSL service are in rural areas where they may only have one choice, or very limited choices, for Internet service,” the FTC said.
The settlement also says Frontier must deploy fiber-to-the-home service to 60,000 homes in California within four years. That’s in addition to Frontier’s previous commitment to deploy fiber to 350,000 homes and businesses in California by the end of 2026, which came as part of a bankruptcy settlement. The new settlement also specifies that the 60,000 homes must be in addition to any deployment made with funding from the Federal Communications Commission or from any state or local government grant.