In a bit of unexpected news, Netflix admitted to having throttled streaming speeds for its videos for AT&T and Verizon customers for the last five years (beginning roughly when both carriers started putting the kibosh on unlimited data). The thinking, by their own admission, is that if Netflix customers on the two largest US carriers blew through their data caps, the resulting overage fees would discourage them from continuing to watch Netflix on their phones and tablets.
By throttling the video streams at 600 Kbps, Netflix reasoned their viewers would be less likely to exceed their data caps (or at least be able to watch more movies or TV shows before doing so). The popular video streaming service stated that Sprint and T-Mobile customers were not subjected to throttling because “historically those two companies have had more consumer-friendly policies.”
Unsurprisingly, AT&T released a statement to The Wall Street Journal expressing ‘outrage’ over the revelation. While they appear to be standing up for their customers at first glance, it should be remembered that the carrier likely would have made significant profits over the past several years from overage fees had Netflix not throttled their customers. Also, Netflix zinged both AT&T and Verizon rather brazenly by suggesting their policies are less consumer-friendly than Sprint and T-Mobile. As of the time of this writing, Verizon has yet to make a statement about the matter.