Verizon Wireless ‘surprised’ by FCC reaction to network optimization plan

Verizon Wireless is sticking to its guns on plans to throttle data speeds for some of its “unlimited” data customers, even after receiving a letter from Federal Communications Commission Tom Wheeler questioning the carrier on the matter.
Speaking with reporters in New York City, Verizon Wireless CEO Dan Mead said he was “very surprised” to have received the inquiry from Wheeler, adding that it appeared the chairman had some of his facts mixed up.
“There were many parts that were incorrect,” Mead said, according to a CNet story. “We have great respect for the FCC, but I’m not sure the chairman understood what we’re doing exactly.”
Wheeler last week sent a letter to Mead saying he was “deeply disturbed” by Verizon Wireless’ plans, accusing the country’s largest wireless carrier of abusing the principle of network management to try and reap more profit from its customers.
“’Reasonable network management’ concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams,” Wheeler wrote.
Verizon Wireless last month announced that beginning in October, it would expand its “network optimization program” from its legacy CDMA network to its LTE network. That program would limit throughput speeds of customers on unlimited data plans should they meet certain parameters. Those conditions include being in the top 5% of data consumers, which is reportedly somewhere just south of five gigabytes per month; are signed up for an unlimited data plan as opposed to a capped data plan; are no longer under contract; and are attempting to access data services from a cell site deemed to be experiencing high demand.
In his letter, Wheeler asked Verizon Wireless to address three issues: first, to explain its rationale for treating customers differently based on their data plans, and specifically, why it included a statement encouraging LTE customers with unlimited data plans to switch to capped plans to avoid any data slowdown; second, the chairman wanted to know why the company was extending its 3G speed reductions to its much faster LTE network; and third, Wheeler asked Verizon Wireless to explain how the policy meets the rules for its 700 MHz license, which state that the carrier cannot deny, restrict or limit the ability of end users to download and use applications of their choosing.
Mead reiterated the carrier’s stance that the program was needed to insure a consistent experience for all of its customers and that the program was similar to what was done by other operators. The carrier also claimed the practice would not violate tenants of its 700 MHz C-Block spectrum holdings that power its LTE network.
“With network optimization, our customers continue to be free to go where they want on the Internet and to use the applications, services, and devices of their choice,” Kathleen Grillo, SVP of regulatory affairs for Verizon Communications wrote in a letter to the FCC. “Although the policy may result in slowed throughput under very limited circumstances, neither the C-Block rules nor the open Internet rules requires any particular minimum speeds, so long as providers are transparent with their customers.”
Verizon Wireless had previously been questioned – and fined – regarding the open Internet provision of its LTE network.
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