National Broadband Plan: Focus on Consumer Disclosure Requirements
The National Broadband Plan (the "Plan") recommends the standardization of technical measurements of broadband performance (e.g., actual speeds), and the establishment of specific performance and service contract disclosure requirements by broadband providers. With regard to mobile broadband, the Plan acknowledges that there are unique disclosure issues relating to speed, performance, coverage and reliability and will work with the wireless industry toward appropriate performance standards and consumer disclosures. The Plan also proposes that the Federal Communications Commission investigate improving transparency relating to broadband performance standards in multiple dwelling units (MDUs) and commercial buildings.
Background
A key objective of the Plan is to empower consumers with relevant information regarding the speed, performance and quality of broadband service offered by fixed and mobile broadband providers. The Plan notes that current disclosures of “up to” maximum speeds often do not reflect the “actual” speeds experienced and that this hinders consumer choice and competition.
Analysis
The Plan makes three broad recommendations designed to improve transparency, and thus enable consumers to make better choices among competing fixed broadband providers. By establishing clearer performance standards and disclosures the Commission intends carriers to provide consumers with the necessary information to choose among fixed broadband providers, select the appropriate service plan, manage their service plan and switch providers. The disclosures are expected to both enhance competition and promote innovation among providers. The Plan includes a fourth recommendation focusing on performance standards and disclosures relevant to wireless broadband providers, MDUs and commercial buildings.
Fixed service recommendations
The Plan recommends that the Commission collaborate with the National Institute of Standards and Technology (NIST) to establish technical broadband performance standards and methods to measure performance for fixed broadband services. Industry and consumer groups will have an opportunity to participate in establishing these standards. The Commission and NIST would determine over what portion of a network to measure performance, when and how often to measure performance and what set of protocols to use to set the performance benchmarks. The Plan focuses on “actual” broadband speeds as a key element in providing consumers with useful information in comparing competing broadband services. Such measurements could include actual speeds during peak periods and the probability of experiencing a particular actual speed over a given period of time (e.g., one hour).
The Plan recommends a rulemaking to establish performance disclosure obligations for fixed broadband providers. These disclosures could consist of "simple and clear data" provided to typical consumers (similar perhaps to the “Schumer box” required in consumer credit disclosures), as well as more detailed disclosures for the benefit of tech-savvy parties interested in designing applications and products for the network. The objective of the disclosures is to promote competition by providing consumers with information relevant to choosing a broadband provider, selecting a specific plan from a provider, evaluating service invoices and switching broadband providers.
Central to this decision-making process is the speed, price and overall performance of each provider’s service. In the rulemaking, the Commission proposes to explore ways in which these elements can be easily compared by consumers including the creation of online decision-making tools for choosing service and possibly the development of a “broadband digital label.” The digital label would concisely identify download and upload speeds (maximum and average) and provide an aggregated quality of service rating similar to the multiple star system used by consumer publications. The Plan also recommends that rules be adopted to require each broadband provider to clearly disclose the prices (including fees and taxes) for different broadband plans offered to potential customers as well as the terms of broadband contracts entered into by consumers.
The Plan recommends that the Commission continue to measure and publish public data on the actual performance of fixed broadband services. The Commission recently made a speed test application available for download from the Commission’s Web site. The Commission’s application also has a feature for consumers to report broadband dead zones and the availability of competing broadband options by location. The Plan envisions making information available on a public Web site that will allow consumers to check on performance claims by broadband providers. In addition, the Commission may publish a “State of U.S. Broadband Performance” report that will allow consumers to compare actual performance of top broadband providers on a geographic basis.
Wireless recommendations
While the Plan recommends a coordinated collaboration between the Commission and the NIST to set performance standards and a rulemaking to establish disclosure requirements for fixed broadband service providers, a different approach is recommended for wireless broadband providers.
For wireless performance standards, the Plan recommends that the Commission develop recommended performance measurement standards by location, carrier and spectrum band to be used in a possible future rulemaking. The Plan also recommends that the Commission continue to gather user generated data on coverage, speeds and performance through the speed test tool available on the Commission’s Web site. This information might be published by the Commission to report aggregate mobile broadband performance. The Plan encourages the industry to develop more standardized and transparent disclosures of coverage, speeds and performance for wireless networks and the Commission expects to be involved in this process. Wireless provider performance standard disclosures are expected to provide various levels of detail for different “audiences” (e.g., regulators, third party aggregators of coverage, and consumers). While the Plan does not explicitly call for a rulemaking on these disclosure standards, it is hard to see how these goals could be accomplished without formal Commission rules.
Broadband disclosures for MDUs and commercial buildings
The Plan suggests that the Commission investigate how to improve broadband performance information made available in residential MDUs, and potentially in commercial and industrial buildings. The goal is to promote the installation of more broadband in such buildings and to allow small and medium businesses to access broadband service with the appropriate performance metrics (speed, security and reliability) required for their individual needs.
The Commission will be releasing a series of notices to launch each of its future proceedings. Davis Wright Tremaine will be participating in those proceedings on behalf of our clients.