US network provider AT&T has clarified the limitations of its "unlimited" data plans, saying after using a certain amount of data customers would experience throttled Internet service.

AT&T confirmed that anyone who gobbles up more than 3GB of Internet data in a single cycle would experience slowed down Internet speeds or would have to pay extra.

The country's second-largest wireless carrier announced the new policy apparently to target customers who consume a lot of Internet data, usually through heavy viewing of videos and other content on their mobile phones.

In a January conference call with analysts, CEO Randall Stephenson said, "In a capacity-constrained environment, usage-based data plans, increased pricing, managing the speeds of the highest volume users-these are all logical and necessary steps to manage utilization."

However, the carrier claims that less than 5 per cent of smartphone customers use more than

Millions of AT&T smartphone customers are still enjoying "unlimited" data plans they signed up for many years back. Anyone now signing up for AT&T has to choose from AT&T's system of tiered data pricing, which offers 3GB for $30 and 5GB for $50 a month. Every extra gigabyte costs $10.