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Court blocks Deutsche Telekom plans to cap Internet speed
FRANKFURT, Oct (KOSDAQ: 039200.KQ - news) 30 (Reuters) - Deutsche Telekom (LSE: 0MPH.L - news) will not be able to cap Internet connection speeds when customers exceed data limits on flat-rate packages, a German court ruled on Wednesday.
The district court of Cologne said the plans would place an "unreasonable disadvantage to the customers" as they count on Internet for a fixed price at stable connection speeds.
Earlier this year, Deutsche Telekom watered down plans to cap data speeds over fixed broadband lines following a public outrage.
It had said that, from 2016, customers who signed up for flat-rate Internet deal and who exceed their monthly data download limit would see their surfing speed capped at 2 megabits per second (Mbit/s).
Deutsche Telekom customers in certain areas with glass fibre networks can get speeds of up to 200 Mbit/s, making the cap equivalent to just 1 percent of what those customers had signed up for.
Although this was an improvement from earlier plans to restrict speeds to 384 kilobits per second, such a cap would still lead to long waiting times to access websites and make it almost impossible to stream music and movies.
The case was brought to court by consumer lobby group Verbraucherzentrale NRW, which said in a statement that after this ruling there was no legal basis for an Internet speed cap.
Deutsche Telekom said it would study the ruling and expected to appeal it.
Germany's former telecom monopoly is in fierce competition with cable companies that have upgraded their lines designed originally to only deliver TV to homes so that they can also carry Internet and voice calls.
They offer Internet at speeds often five times faster than the competing services from telecom operators.
Earlier this month, Vodafone (LSE: VOD.L - news) completed the 7.7 billion euro acquisition of Kabel Deutschland (Other OTC: KBDHF - news) , hoping to snatch some of Deutsche Telekom's 12.4 million broadband customers, giving it a market share of more than 40 percent.
