FCC aims to stop broadband bill shock, reviving plan nixed by Ajit Pai

The Federal Communications Commission is moving ahead with plans to require broadband “nutrition labels” that include details on the actual price of Internet service and information about data caps and performance.

The consumer labels that home Internet and mobile broadband providers would have to provide at the point of sale will be similar to those adopted by the FCC in 2016. The labels and related rules requiring greater transparency were eliminated under former FCC Chairman Ajit Pai, but the Infrastructure Investment and Jobs Act approved by Congress in November 2021 requires the FCC to issue new rules mandating the display of the consumer labels.

Today’s 4-0 FCC vote approved a Notice of Proposed Rulemaking (NPRM) that seeks public comment on the plan. There’s generally at least a few months between an NPRM and a commission vote to issue final rules. The deadline for initial comments will be 30 days after the NPRM is published in the Federal Register, and reply comments will be due 45 days after Federal Register publication. The docket where comments will be filed can be found here.

Price, fees, data caps, and performance data

The FCC is proposing to adopt the same labels it did in 2016. For home Internet service, that includes “1) pricing; 2) monthly data allowance; 3) overage charges; 4) equipment fees; 5) other monthly fees; 6) one-time fees; and 7) early termination fees,” a public draft of the NPRM released before the meeting said. The home Internet labels would also “include information on performance (speed, latency, and packet loss) and on network management practices,” the draft said.

Mobile broadband labels would include “information on 1) pricing; 2) when you exceed data allowance; 3) other included services/features; 4) other monthly fees; 5) one-time fees; 6) service contract terms; 7) early termination fees; and 8) ‘bring your own device’ information,” the draft said. The mobile broadband labels would also include “performance information (speed, latency, and other services on the network) and network management practices,” the FCC said. “Both the fixed and mobile broadband labels include a link to the provider’s privacy policy and a link to how to file complaints and inquiries.”

The FCC is seeking comment “on where the labels should be displayed to best inform consumers; on enforcement issues related to the label requirement, including how the Commission should ensure the accuracy of label content; on implementation issues, including the time by which broadband providers should be required to display the labels.” The FCC is proposing “to ensure that any required labels are accessible to persons with disabilities.”

Here’s a look at the 2016 version of the fixed and mobile broadband labels:

Comparison shopping—when there’s more than one choice

Consumer labels don’t address the most frustrating problem for many home Internet customers—a lack of competition. Internet service providers take advantage of that by imposing high prices, data caps with overage charges, and hidden fees such as Frontier’s “Internet Infrastructure Surcharge.” The consumer labels should make it easier for users to determine the actual price of broadband when they start a new subscription, though they wouldn’t require ISPs to lower prices.

While some people do have a choice of two or more home Internet providers, the potential for the labels to aid customers in comparison shopping is greater in the mobile broadband market, which has three major national providers and a variety of smaller ones. FCC Commissioner Geoffrey Starks focused on the potential to help customers compare ISPs in his statement at today’s FCC meeting.

“Shopping around for the best broadband plan can be a lot of work,” Starks said. “The ‘nutrition labels’ we seek comment on today will help households compare prices and service offerings, making it easier for them to find the right package and the best deal.”

ISPs love “hidden fees, surprise bills, and dense contracts”

“Today’s FCC vote is a welcome step forward and a win for consumers,” Joshua Stager, deputy director for broadband and competition policy at New America’s Open Technology Institute, said today. ISPs are “notorious for keeping customers in the dark” with “hidden fees, surprise bills, and dense contracts,” he said.

“The broadband nutrition label cuts through this confusion by clearly disclosing the cost and terms of service in a simple, consumer-friendly format,” Stager said. “It’s a common sense idea that we look forward to working with the commission to implement. People deserve to know what they are paying for.” The Open Technology Institute has been calling on the US to adopt a “Broadband Truth-in-Labeling” program since 2009.

While broadband lobby groups will likely urge the FCC to minimize the amount of information ISPs are required to provide, consumer advocates plan to call for the labels to be more detailed. “As the record develops, we hope it will show that these labels can be made even more impactful if the commission were to adopt requirements that the labels link to information about what speeds a household might need, as well as provide information on what certain technical terms mean,” said Jenna Leventoff, senior policy counsel at Public Knowledge.