FCC eases broadband fee disclosure rules for internet providers

The Federal Communications Commission voted to loosen broadband price-label rules that had required internet providers to itemize certain monthly fees charged to customers. The change affects how much detail shoppers see when comparing plans, especially for charges providers pass through from governments or third parties.

The FCC approved the order in a 3-0 vote, with Democratic Commissioner Anna Gomez joining the agency’s Republican majority. The final order has not yet been made public, according to Ars Technica, but Gomez described changes made from an earlier draft during the FCC meeting.

What the rule changes

The 2023 broadband-label rules required providers to list “all discretionary monthly fees that the provider passes through to the consumer,” according to the FCC order adopted under the Biden administration. Those labels were meant to give customers a clearer view of monthly costs before they signed up for service.

Under the new approach, providers will be able to show an aggregate “up to” amount for passthrough fees rather than itemizing every charge on the main label, according to the FCC proposal. Gomez said the revised labels will also include descriptions of fees remitted to state and local governments and fees remitted to third parties.

“Though I would have preferred that the labels provide a complete itemization [of fees], consumers will have the option to click on a link below to learn more about each of the types of fees and what they are used for,” Gomez said at the meeting.

Gomez’s office told Ars Technica that the final version adds two subcategories under the passthrough-fee total: one for state and local government charges and another for third-party charges. Her office said the labels will include lists of fee types and a link to a provider-run webpage explaining what fees such as E911 or pole attachment charges mean and how they are used.

Label access also changes

The order also changes how providers may present broadband labels online. Gomez said the FCC will keep a requirement that providers include broadband labels in customer account portals, but companies may use a hyperlink or icon instead of displaying the full label there.

Gomez said she would have preferred full labels to remain visible. She said she hopes the FCC, providers and consumer groups will promote broadband labels so customers know to use them.

The FCC said another update will allow customer service representatives to discuss label information over the phone rather than read the full label word for word. Gomez said the rules still require key details to be conveyed by phone, including the monthly price with monthly fees, any introductory rate and its length, typical download and upload speeds, latency, data allowance, contract term and early termination fees.

Providers cited compliance costs

FCC Chairman Brendan Carr said broadband labels had become too cluttered under the prior rules. In a press release, the FCC said the earlier requirements produced labels that could confuse consumers and increased compliance costs for providers.

Carr said providers will still offer a label for every standalone broadband plan. He said labels will continue to include information on pricing, introductory rates, speeds and data allowances, and will remain available in the languages providers use to market their services.

USTelecom, a broadband industry group, had told the FCC that itemizing passthrough fees could require providers to create and update hundreds of labels because the fees vary by location. The FCC draft order said passthrough fees include charges such as state and local right-of-way fees and pole attachment fees imposed by third-party pole owners.

The FCC draft said these charges are costs that providers choose to pass on to customers rather than include in the base monthly price. Unless the implementation date changed in the final order, the new rules will take effect 30 days after publication in the Federal Register.

This story draws on original reporting from Ars Technica.