In a second development this week relating to transparency between broadband Internet service providers (ISPs) and their customers, the FCC unveiled a new consumer broadband label that fixed and mobile ISPs can provide at the point of sale (i.e., online or retail store locations) to provide price, speed, data allowance and other facts that prospective customers can use to make informed decisions about the purchase of broadband services.
Resembling the “nutrition facts” label found on many food products, the FCC’s new “broadband facts” label was developed with the assistance of the federal Consumer Financial Protection Bureau (CFPB), which has designed similar consumer disclosures to promote transparency in mortgages, student loans, and other financial products. The label has also been endorsed by members of the FCC’s Consumer Advisory Committee which includes representatives of cable and wireless ISPs. Data appearing on the labels will include (1) price points that encompass monthly service rates as well as overage, equipment, early termination and administrative fees, (2) monthly data allowances, and (3) broadband service speeds and other performance metrics. Although the FCC is not requiring ISPs to implement the new label, agency officials said ISP usage will serve as a “safe harbor” for demonstrating compliance with FCC Open Internet rules requiring ISPs to disclose broadband service terms and cost information to consumers “in an accurate, understandable and easy-to-find manner.”
At the unveiling event on Monday, FCC Chairman Tom Wheeler underscored the need for such a label in observing that the FCC receives more than 2,000 complaints each year that pertain to consumer Internet bills. Wheeler maintained that the new broadband labels not only “provide consumers clarity about the broadband service they are purchasing” but also “[prevent] surprises when the first bill arrives.” CFPB Director Rich Cordray commended Wheeler and the FCC “for bringing new transparency to the broadband market, which will help people understand what they are getting before they sign up.” While emphasizing that many cable ISPs already provide customers “with accessible and relevant information about broadband services,” a spokesman for the National Cable & Telecommunications Association noted: “we appreciate this contribution by the [FCC] to offer consumers that same information in a format they are familiar with.”