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New Affordable Connectivity Program Rules Prevent Credit Checks, Make Termination Harder

The rules prevent providers from denying service to lower-income customers.

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Photo of Jamile Kadre from Latinas in Tech

WASHINGTON, March 22, 2022 – The Federal Communications Commission’s tough consumer protection rules for its Affordable Connectivity Program will make it harder for providers to exclude or terminate internet customers based on credit scores and late payments, according to agency attorneys.

The tougher rules are new additions to the subsidy program, which was known as the Emergency Broadband Benefit before the Infrastructure, Investment and Jobs Act made it permanent as the ACP. The program provides a discount of up to $30 per month toward internet service for eligible households and up to $75 per month for households on qualifying tribal lands – as well as a one-time discount of up to $100 to purchase a device.

In an overview of the program on March 9, FCC staff attorneys told an event hosted by the Federal Communications Bar Association that the ACP’s implementation rules were designed to prevent predatory consumer practices.

Jamile Kadre, an attorney at the Wireline Competition Bureau, said that the rules empower customers to choose a service plan that best meets their needs, informs them of their rights and prevents providers from denying service based on their credit status.

The law specifically prevents providers from requiring eligible households to submit a credit check as a condition of applying to the program.

The rules, which are meant to encourage greater consumer choice, also prevent providers from running credit checks to determine which ACP-supported internet plan a household can apply their benefit to or restrict the type of plan available to a household based on their credit. However, providers can run routine credit checks if they are part of the provider’s sign-up process for all consumers.

The ACP will also make it harder for providers to terminate household service for late payments. A termination can only be made if a customer stops paying for 90 consecutive days.

Preventing up and down selling

The IIJA also includes several rules that prevent providers from “inappropriate” upselling and down selling to customers using their benefit.

Upselling is a sales technique that encourages customers to buy a higher-end version of the product than what the customer originally intended, while down selling offers consumers the less-expensive version.

Screenshot of Jamile Kadre, attorney at the Federal Communications Commission’s Wireline Competition Bureau

“It’s important that the plans meet the needs of the consumer,” said Kadre, adding there shouldn’t be any kind of inappropriate pressure on a household to include them to purchase a different plan “other than what they would have intended with different speeds or bandwidth.”

The FCC’s rules also prevent customers from any requirement to opt-in to any extended service contract as a condition to participating in the program and prohibits providers from limiting a household’s ability to switch internet service offerings.

While providers can require that customers return equipment used on the premises, Kadre said the rules prevent practices that cause a household to believe they are prohibited from transferring their benefits to a different provider.

The new rules come after an FCC watchdog found evidence of fraud in the EBB, including telecoms overenrolling households.

To be eligible for the ACP, the household income must be at or below 200% of the Federal Poverty Guidelines or meet certain criteria such as participation in certain assistance programs such as SNAP, Medicaid, and WIC.

Last month, the White House celebrated the more than 10 million American households enrolled in the ACP. Advocates have urged the FCC to take action on outreach hurdles and encourage more households to apply.

FCC

FCC Nominee Gigi Sohn Withdraws from Consideration

Sohn was first nominated in October 2021.

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WASHINGTON, March 7, 2023 – The nominee for the fifth commissioner to the Federal Communications Commission withdrew her candidacy in a statement Tuesday, blaming “dark money political groups” for tainting her career.

“Unfortunately, the American people are the real losers here,” Gigi Sohn said in the statement. “The FCC deadlock, now over two years long, will remain so for a long time. As someone who has advocated for my entire career for affordable, accessible broadband for every American, it is ironic that the 2-2 FCC will remain sidelined at the most consequential opportunity for broadband in our lifetimes.”

Just last month, Sohn appeared before the Senate commerce committee for a third time and was lambasted by Republican members as an impartial nominee who has made controversial public statements on race and policing and who alleged gave money to members of the committee while being a nominee.

“When I accepted his nomination over sixteen months ago, I could not have imagined that legions of cable and media industry lobbyists, their bought-and-paid-for surrogates, and dark money political groups with bottomless pockets would distort my over 30-year history as a consumer advocate into an absurd caricature of blatant lies,” Sohn’s statement said. “The unrelenting, dishonest and cruel attacks on my character and my career as an advocate for the public interest have taken an enormous toll on me and my family.”

She appealed to the committee to hurry her to the Senate floor for votes so she can get to work on the FCC’s broadband availability map. She said in her statement that her withdrawal also means the commission won’t have the majority to adopt rules on nondiscriminatory access to broadband and to fix the Universal Service Fund programs.

Sohn was nominated for a second time by President Joe Biden in January.

“I hope the President swiftly nominates an individual who puts the American people first over all other interests,” she added in the statement. “The country deserves nothing less.”

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Broadband Mapping & Data

General Agreement on Broadband Label, But Not on Additional Disclosure Requirements

The FCC is considering additional requirements, but that could be burdensome for small providers.

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Screenshot of speakers at the Federal Communications Bar Association event

WASHINGTON, February 15, 2023 — As the comment deadline approaches for the Federal Communications Commission’s broadband “nutrition label” rule, industry experts are largely supportive of the measure, although some disagree over whether the requirements go too far or not far enough.

The FCC is currently considering whether to add additional requirements — such as cybersecurity data and more comprehensive pricing information about bundled plans — to the labels, which were mandated in November and require that providers list performance metrics, cost and other facts to inform purchasers at all points of sale. Other proposed measures aim to improve accessibility by requiring non-English translations, as well as Braille or a QR code with a tactile indicator. The comment deadline is Thursday.

Further requirements could have negative impacts on both consumers and providers, argued Farhan Chughtai, senior policy counsel at broadband consulting company JSI, at a Feb. 6 Federal Communications Bar Association event.

“You don’t want to make the labels too difficult—that’s going to lead to more consumer confusion,” Chughtai said. He pointed to metrics such as network management, network reliability and cybersecurity as topics that might be “too nuanced” for the labels.

Overly complicated labels risk being treated like terms of service agreements, where many users just skip through them, Chughtai said. “Let’s focus on speed, latency, monthly usage.”

Additional requirements would place a disproportionate burden on smaller, rural providers, he added.

Chughtai also pointed to the “point of sale” disclosure requirements as a potential barrier for small providers.

“For some of the larger providers, that documentation can be automated,” he said. “But when you’re talking about a small carrier in Kentucky that has two or three people that are working, that type of communication… could be troublesome. So again, I think that the commission did strike a good balance, but when it comes to implementation, I think there’s ways to continue to refine this.”

Diana Eisner, vice president of policy and advocacy at industry association USTelecom, agreed with Chughtai, adding that both small and large providers “agree that this point of sale documentation is problematic.”

The FCC should work with industry and consumer groups to continuously fine-tune the label requirements, Chughtai said.

Debate on current version of label

“I think the commission really struck the right balance largely of making sure that consumers can see the information in a snapshot—they’re not overloaded with irrelevant information,” Eisner said.

Consumer advocates are generally excited about the label, said Jonathan Schwantes, senior policy counsel at Consumer Reports. “I think the commission gets it mostly right,” he said.

However, Schwantes voiced concerns about the label’s scope, saying that they were intended to educate consumers in addition to serving as a comparison shopping tool.

“I’m concerned that existing consumers may never see the label unless you’re moving or you decide to change or maybe if you’re lucky enough to have a competing provider,” he said. “Based on the [FCC’s Communications Marketplace] report that came out right at the end of last year, there are still many millions of Americans who only have one choice of broadband provider.”

Schwantes noted that he and several other consumer groups attempted to address this issue by advocating for the labels’ inclusion on monthly service bills, but such a requirement failed to make it into the FCC’s mandate.

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Broadband Mapping & Data

For Sake of Accurate Broadband Map, Gigi Sohn Urges Senators Not to Delay Her Vote as FCC Commissioner

Sohn added the Supreme Court decision in West Virginia could challenge net neutrality rules.

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WASHINGTON, February 14, 2023 – The first thing that she will do as the fifth commissioner of the Federal Communications Commission is to get involved in improving the agency’s map on which billions in federal broadband infrastructure funds are dependent, Gigi Sohn said during her third Senate committee hearing Tuesday.

But a delay in her vote in the chamber that confirms presidential nominations may also prove too late for the assistance she said she could provide before the National Telecommunications and Information Administration, which relies on the map to deliver billions in federal dollars for broadband infrastructure, begins delivering the money to states.

That’s because the Commerce Department agency has targeted by June 30 the delivery of the $42.5 billion from its Broadband Equity, Access and Deployment program, which was created out of the Infrastructure, Investment and Jobs Act.

“That June 30th date is a really, really critical date, and that’s why time is really of the essence to get me confirmed because if I don’t get confirmed at all, there’s not going to be a fifth person on the FCC in time to do anything about those maps,” Sohn told the commerce committee, elaborating that the FCC is doing the best it can with the current four-person makeup of the commission.

“Now I can’t fix it myself,” Sohn added, “but I have unbelievable relationships with the states, including many of the states of folks that sit on this dais and I would love to help improve that broadband map.”

Sohn, who was nominated for the FCC for a second time by President Joe Biden, noted that she worked hard to sell the infrastructure bill to the public interest community because of its bipartisan support it received and the amount of money involved.

Since the first draft of the FCC map was released in November, there have been over 20 states involved in over a million challenges to the data underlying it. Commission chairwoman Jessica Rosenworcel said in a February letter to senators concerned about accuracy that the challenges amounted to less than one percent of total number of locations identified, but added the agency has spilled “significant resources” since the first version to improve its accuracy.

Republican senators drill in on net neutrality

Near the top of the hearing, committee chair Maria Cantwell, D-Wash., accused opposing Republicans of using controversies surrounding Sohn – such as what they called her partisan retweets related to views on policing and race – as a “proxy fight” for their concern about the nominee’s position on net neutrality.

Republicans on the committee – who attacked Sohn throughout the over-two-and-a-half-hour hearing on alleged conflict of interest issues related to things including financial donations to senators on the committee – have been concerned about Sohn’s clear support for the principle, which dictates that internet traffic should not be manipulated, slowed or sped up by the provider under any circumstances. The FCC under the leadership of Ajit Pai in 2017 reversed the Barack Obama era net neutrality rules established in 2015.

Republican senators on the committee wanted to know whether Sohn believes it should be Congress’s call to provide the authority to the FCC to make net neutrality rules or if the agency can go it alone.

While Sohn said she believes the FCC has the authority to unilaterally imposed such rules, she said she is in favor of deferring to Congress to give the commission explicit authority.

“I would love for Congress to give the FCC proper authority and specific authority to adopt net neutrality rules,” Sohn said.

“Congress has had two decades now to decide that authority and it’s refused to do so,” she added. “However, I still believe Congress should do so and I beg Congress to do so, but until then, until it does so, the agency has got to have authority.” Others have agreed that the FCC already has unilateral authority to reinstitute those rules.

This time, however, the Republicans have promised to increase oversight of the agency, empowered by a West Virginia v. EPA decision of the Supreme Court that determined administrative bodies must derive authority explicitly from Congress on major questions, including of economic- and policy-related matters.

“I think the FCC can and has the authority to act,” Sohn said in response to a question about whether she thinks the FCC can act on net neutrality unilaterally in light of the Supreme Court decision. “It doesn’t mean it won’t be challenged and the West Virginia case is going to be a challenge for net neutrality rules.”

Before the midterm elections, legislation was introduced that would have codified net neutrality in the law. Democratic senators Doris Matsui, Ca., Edward Markey, Mass., and Ron Wyden, Ore., introduced the Net Neutrality and Broadband Justice Act. Meanwhile, some states, including California, have already instituted net neutrality rules.

The FCC, for perspective, has previously deferred to Congress on a separate issue, asking the lawmaking body to determine the administrative body’s authority over expanding the funding base of the Universal Service Fund, which includes programs that provide basic telecommunications services to rural and remote areas.

Other FCC-related matters

Sohn also showed support to requests, currently being raised to the FCC, for the commission to expand the USF’s E-Rate program to cybersecurity tools. The E-Rate program helps schools and libraries obtain affordable internet.

“I think that’s something that the FCC should definitely look at,” Sohn said, noting the commission would need to do a proceeding on it. “I’ve hear about this in Arizona and other states and I think this is something where E-Rate funding — if we’re talking about making sure that K through 12 students have the best networks, the most secure networks — it seems to me, logical…to extend E-Rate funding to cybersecurity tools.”

The co-founder of internet advocacy group Public Knowledge was pushed through the same committee a year ago next month with a party-line vote, but never got a vote on the Senate floor, which is again in Democratic hands after the midterms.

“The Commerce Committee and then the full Senate should advance this nomination without further delays, which only benefit those big companies orchestrating this impasse,” said advocacy group Free Press in a statement. “If the Senate genuinely wants to improve the lives of internet users, cellphone customers, TV watchers and radio listeners — aka, everyone — it can start by confirming this excellent public servant to the FCC immediately.”

If voted in, she would represent the party tie-breaking vote on a commission that consists of two Democrats and two Republicans.

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