Mexican operator Unefon has admitted that its so-called “unlimited” data plans have a speed limit of 5 Mbps, despite the fact that they run over AT&T’s 4G/LTE network. According to a news report, the MVNO acknowledged that speeds would be capped at 5 Mbps for a maximum of 5 GB of data a day, going down to 1 Mbps once that limit is reached. Users complained that Unefon did not publish information on speed limits when its “unlimited data” plans were launched earlier this year.

Under the Unefon Ilimitado (Unlimited) plan, prepaid users topping up MXN 10.00 (US $0.50) and above will have access to unlimited data, minutes and SMS for one day. Users must top up at least MXN 70.00 (US $3.50) every 30 days in order to access the offer.

Tarifica’s Take

We have reported on many instances in which data plans that were described as “unlimited” by mobile operators have turned out to have hidden limits. Usually what that means is that there are allowances beyond which throttling is imposed. Sometimes it refers to situations in which certain users will be throttled regardless of data thresholds in times and places where there is congestion on the network.

In this case, something even less appealing to customers is going on. The service turns out to have an extremely low data speed, far below industry standards, which effectively limits the service even independently of any idea of data thresholds. The fact that there is a threshold, as well—a low one of 5 GB per day, after which the speed is lowered to almost dial-up levels—only adds insult to injury. And the fact that this low speed is being offered over a sophisticated network that is known to boast high speeds makes the negative impact on consumer confidence even bigger.

This story is an object lesson for operators in how not to handle network-related matters. Today’s consumers are savvier than ever about data and networks and have expectations that need to be met, regardless of budget. An MVNO cannot hope to keep prices down by compromising on quality to this extent. And perhaps more importantly, honesty and transparency are absolutely essential in this realm. To be caught misleading subscribers and then having to belatedly acknowledge the fact is very harmful to an operator’s brand.