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AT&T Sued Over Alleged Overbilling for iOS Device Data Usage

Courthouse News Service reports that AT&T has been hit with a new class action lawsuit alleging that the carrier is overbilling its customers for data transferred through its networks to iOS devices such as the iPhone and iPad. According to the suit, AT&T is overstating the amount of data used for each transaction, leading some users to exceed their data plan limits and incur extra charges.

This one claims that "AT&T's bills systematically overstate the amount of data used on each data transaction involving an iPhone or iPad account," and bills customers for data transactions even if they disable their phones and leave them untouched - as the plaintiff's experts did.

The class says AT&T's billing system "is like a rigged gas tank that charges pump that charges for a full gallon when it pumps only nine-tenths of a gallon into your car's tank."

The filing describes how a consulting firm hired by the plaintiff's attorneys conducted a two-month study that found AT&T overstating data usage by 7-14%, with some transactions coming in at as much 300% above the actual amount of data transferred.

The complaint goes on to detail data transactions being recorded even when no data usage is being initiated by the customer, as determined by the company purchasing an iPhone and letting it sit with push notifications and location services disabled and with no applications open or other data-transferrring tasks enabled.

This was discovered by the same independent consulting firm, which purchased an iPhone from an AT&T store, immediately disabled all push notifications and location services, confirmed that no email account was configured on the phone, closed all applications, and let the phone sit untouched for 10 days. During this 10-day period, AT&T billed the test account for 35 data transactions totaling 2,292 KB of usage. This is like the rigged gas pump charging you when you never even pulled your car into the station."

PC World notes that the greater-than-expected data usage may in some cases be related to Apple's multitasking features deployed in iOS 4 that allow certain processes of applications to continue running in the background even after the applications themselves have been suspended by the user switching to a different application.

Many of those apps may be actively communicating and downloading data in the background. So, perhaps the data issues that users are seeing, and that AT&T is being accused of systematically overcharging for, are--at least in part--a function of the "virtues" of adding multitasking to iOS. I can tell you this: once we realized all of these apps were running and started manually shutting down all of the multitasking apps, my data usage issues went away.

While it is true that certain applications running in the background can utilize data, that explanation does not appear to account for the circumstances cited in the lawsuit, which involve alleged overstatement of data used in individual transactions and phantom data usage by devices configured not to use data services.