It’s a practice called over selling and no, it is absolutely theft. If it wasn’t theft we would allow it in other areas. Why can’t your electric company do the same to you ? The wires can carry a specific amount of current at any one time. Why aren’t they charging you for that total capacity whether or not you’ll ever use it? The pipes to your house can carry a specific volume of water per hour. Why don’t they charge you even if it doesn’t? Why is it that if you sell 16 oz jars of peanut butter that customers find only actually have about 4 oz on average? You end up in court. But when you sell people, bandwidth etc. That you don’t have. It’s just called good business. Basically why, if this isn’t theft, is it only allowed in the telecommunications industry? And only in consumer telecommunications. Business service is guaranteed bandwidth that they pay for.

It is quite literally theft/ a scam. Just like them selling connections with no cap on total data transfer. That they then proceeded to heavily throttle the moment you went over a few gigabytes. Quickly doing away with it the moment the government started taking a look into their dishonest practices. It’s only “allowed” currently, because not enough consumers are informed enough to really object. ISPs seriously make used car salesmen look almost decent.