FCC chairman Tom Wheeler's got some harsh words for Verizon. NEW YORK (CNNMoney) Verizon's biggest users may soon find that their data plans aren't so "unlimited" after all. And federal regulators aren't happy about it. Federal Communications Commission chairman Tom Wheeler sent a letter to Verizon (VZ, Tech30) questioning its plan announced last week to slow down 4G connection speeds for certain customers with unlimited data plans. The news was first reported by Mashable, which posted a copy of the letter online.
Wheeler didn't mince words in his criticism of the wireless giant, saying he was "deeply troubled" by the initiative.
Verizon no longer offers unlimited data plans to new customers. But subscribers who signed up for unlimited plans before Verizon ditched them in 2012 can keep those plans -- provided they pay full price when they get a new phone. The company said last week that it would occasionally slow the connection speeds of those customers during times of heavy network usage if they fall within the top 5% of data users.
The telecom giant said it would throttle speeds to help manage its network. But Wheeler rejected "network management" as a justification for slowing connections of paying customers. He called Verizon's actions "disturbing," suggesting that the company was trying to force people into usage-based plans, in which customers pay per gigabyte.
"'Reasonable network management' concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams," he wrote. "I know of no past commission statement that would treat as 'reasonable network management' a decision to slow traffic to a user who has paid, after all, for 'unlimited' service.'"
Verizon said Thursday that it would send an official response to Wheele! r once it had "received and reviewed" the letter.
"[W]hat we announced last week was a highly targeted and very limited network optimization effort, only targeting cell sites experiencing high demand," the company said in a statement. "The purpose is to ensure there is capacity for everyone in those limited circumstances, and that high users don't limit capacity for others."
Verizon says unlimited data users will only experience slower speeds while performing high-bandwidth activities like online gaming or streaming video.
The FCC is currently in the process of finalizing new regulations on "net neutrality," or how broadband Internet providers can treat traffic on their networks. Those rules won't apply to the wireless services, however, which are more lightly regulated.
From a regulatory perspective, mobile connections differ from broadband in part because wireless spectrum -- the collection of frequencies over which all wireless transmissions travel -- is a finite resource. That means managing traffic can be more challenging for carriers.
The FCC auctions off spectrum rights to private companies, and Wheeler said Verizon's new policy could violate the terms of ownership for the high-speed spectrum it currently holds.
WEST BRIDGEWATER, Mass. -- It's been called a David vs. Goliath story, a "Tale of Two Arthurs" and even the "ultimate Greek tragedy," but the characters in this drama aren't Biblical or literary figures. They're grocery store owners. A workers' revolt at the Market Basket supermarket chain has led to empty store shelves, angry customers and support for a boycott from more than 100 state legislators and mayors. Industry analysts say worker revolts at non-union companies are rare, but what's happening at Market Basket is particularly unusual because the workers aren't asking for higher pay or better benefits. They are demanding the reinstatement of beloved former CEO Arthur T. Demoulas, who workers credit with keeping prices low, treating employees well and guiding the company's success. The New England grocery store chain is embroiled in a family feud featuring two cousins who have been at odds for decades. While earlier squabbles between Arthur T. Demoulas and Arthur S. Demoulas were fought in courtrooms, this dispute has spilled into Market Basket stores. For the past week, warehouse workers have refused to make deliveries to Market Basket's stores, leaving fruit, vegetable, seafood and meat shelves empty. Workers have held huge protest rallies and organized boycott petitions through social media, attracting thousands of supporters. Customers are defecting to other grocery stores. In some cases, customers have taped receipts from competitors to Market Basket windows. "We are going to go somewhere else from now on," said Soraya DeBarros, as she walked through a depleted produce department at the Market Basket in West Bridgewater this week. "I'm sad about it because of course I want to keep the low prices, but I want to support the workers." Despite threats by new management to fire any workers who fail to perform their duties, some 300 warehouse workers and 68 drivers have refused to make deliveries. So far, eight supervisors have been fired. Massachusetts Attorney General Martha Coakley, who is running for governor, and New Hampshire Gov. Maggie Hassan have publicly supported the employees. "If you had told me that workers at a grocery store would walk out to save the job of a CEO, I would say that's incredible. There is usually such a gulf between the worker and the CEO," said Gary Chaison, a professor of industrial relations at Clark University in Worcester. Long-Running Feud Market Basket stores have long been a fixture in Massachusetts. The late Arthur Demoulas -- grandfather of Arthur S. and Arthur T. and a Greek immigrant -- opened the first store in Lowell nearly a century ago. Gradually, Market Basket became a regional powerhouse, with 25,000 employees and 71 stores in Massachusetts, New Hampshire and Maine. The feud dates back to the 1970s, but the most recent round of infighting began last year when Arthur S. Demoulas gained control of the board of directors. Last month, the board fired Arthur T., sparking the current uprising. Workers are fiercely loyal to Arthur T. "You know the movie, 'It's a Wonderful Life.' He's George Bailey," said Tom Trainor, a district supervisor who worked for the company for 41 years before being fired last weekend over the protests. "He's just a tremendous human being that puts people above profits. He can walk through a store, and if he's met you once, he knows our name, he knows your wife, your husband, your kids, where they are going to school." Employees said they believe the fight between the family members loyal to Arthur T. and Arthur S. is largely over money and the direction of the company. They say Arthur S. and his supporters have pressed for a greater return to shareholders. Arthur T. and his supporters have focused on keeping prices low. Outsiders Brought In Many employees are distrustful of Arthur S. and two co-chief executives who were brought in from outside the company: Felicia Thornton, a former executive of the grocery chain Albertsons, and Jim Gooch, former president and chief executive at RadioShack (RSH). "I'm worried about my job," said Valerie Burke, a worker in the West Bridgewater store. "It's a great company to work for now, but we are worried it won't stay that way," she said as she picketed outside the store Tuesday. Arthur S. hasn't spoken publicly, while Gooch and Thornton have communicated only through prepared statements. They assured workers in a statement that they aren't planning drastic changes in the way the company is operated, and urged employees to return to work. Arthur T. on Wednesday offered to buy the company for an undisclosed amount. Gooch and Thornton declined to comment. Workers have planned another rally Friday in Tewksbury, while the company's board of directors is scheduled to hold a meeting the same day in Boston. Steve Paulenka, who started in 1974 as a bag boy and rose to facilities and operations manager before being fired last weekend, said he sees no end to protests unless Arthur T. is reinstated. "A big part of me doesn't like what's going on -- it's like breaking your favorite toy on purpose," he said. "But we'll get through this."