FCC Announces Enhanced Broadband Transparency Disclosures Will Become Effective on January 17, 2017 – Small Provider Exemptions in Limbo

On Thursday, December 16, the FCC announced that the Office of Management and Budget had approved the long-delayed “enhanced” Open Internet transparency requirements, which were originally approved in March 2015. As a result, the deadline for providers to comply with these enhanced requirements is January 17, 2017.  

Significantly, this deadline also applies to small providers (those with 100,000 or fewer broadband subscribers) following the FCC’s decision not to extend the exemption for these entities. However, in a letter to major industry associations, the two Republican members of the Commission, Ajit Pai and Michael O’Rielly, have indicated that they both supported an extension of the small provider extension, and suggested that “they would not support any adverse actions against small business providers for supposed non-compliance.” Unfortunately, this commitment to forbear from any enforcement action may still leave small providers subject to potential enforcement action unless, or until, a final action to extend (or repeal) the new rules takes effect.

As a result, broadband Internet access services providers covered by these rules must ensure that their network management statements properly disclose information covered by the enhanced transparency requirements.  As we described in detail in prior advisories, these additional requirements include several significant new obligations for broadband providers, including the obligation to disclose information on “actual” network performance characteristics such as packet loss; additional commercial terms, including promotional rates and non-recurring fees, data caps and allowances; and user or application-based practices that are likely to “significantly affect” an end user’s service.

In addition, in May 2016, several of the FCC’s bureaus released guidance on the enhancement transparency requirements.  This guidance, in addition to providing more detail on how providers are to measure metrics such as packet loss and peak usage, also concluded that providers must offer a separate disclosure for each service package or tier that it offers to customers. Our analysis and summary of the guidance is available here.