Verizon Wireless today confirmed that it will begin slowing down LTE data speeds when customers who have unlimited plans and use a lot of data connect to congested cell sites. This "Network Optimization" was implemented in 2011 but previously applied only to 3G users.

"Starting in October 2014, Verizon Wireless will extend its network optimization policy to the data users who: fall within the top 5 percent of data users on our network, have fulfilled their minimum contractual commitment, and are on unlimited plans using a 4G LTE device," the Verizon announcement said. "They may experience slower data speeds when using certain high bandwidth applications, such as streaming high-definition video or during real-time, online gaming, and only when connecting to a cell site when it is experiencing heavy demand."

People who use 4.7GB or more per month fall in the top five percent and will thus see slower connections when using their devices in congested areas, Verizon says in an FAQ. When asked to explain the reason for the "minimum contractual commitment" clause, a Verizon spokesperson told Ars the company is focusing the policy on "customers who are still on a month-to-month plan" and have grandfathered unlimited data. "We discontinued offering unlimited plans to new customers in 2011," the spokesperson said.

Verizon somewhat nonsensically claims its network optimization isn't "throttling" because it doesn't happen 100 percent of the time. Throttling is still throttling whether it happens one percent of the time or 100 percent, of course. The point Verizon is really trying to make is that its Network Optimization policy is a form of reasonable network management needed to ensure a smooth experience for as many users as possible.

"No, this is not throttling," Verizon's FAQ states. "The difference between our Network Optimization practices and throttling is network intelligence. With throttling, your wireless data speed is reduced for your entire cycle, 100 percent of the time, no matter where you are. Network Optimization is based on the theory that all customers should have the best network possible, and if you’re not causing congestion for others, even if you are using a high amount of data, your connection speed should be as good as possible. So, if you’re in the top 5 percent of data users, your speed is reduced only when you are connected to a cell site experiencing high demand. Once you are no longer connected to a site experiencing high demand, your speed will return to normal. This could mean a matter of seconds or hours, depending on your location and time of day."

On the flip side of the coin, consumers don't get any extra data when they connect to cell sites that aren't congested. Even if a customer's data use isn't "causing congestion for others," the customer is subject to data caps and financial penalties for going over them.

If Verizon only needs to limit data speeds on the most congested sites, why impose limits on data use when users connect to the sites that aren't congested? Money, of course.

Some longtime Verizon customers still have unlimited data plans, but the company has aggressively pushed new and existing users onto limited packages. A recent survey found that "just 22 percent of Verizon customers have an unlimited data plan, compared with 44 percent for AT&T and 78 percent for both Sprint and T-Mobile," according to Re/code. (UPDATE: This study is apparently incorrect. Verizon has told BGR that it's actually less than 22 percent, while AT&T says only 19 percent of its smartphone users are on unlimited plans.)

Verizon has monetized its data caps successfully, charging users the highest bills of any major carrier in the country.