FCC eases broadband fee disclosure rules for internet providers

The Federal Communications Commission voted 3-0 to roll back a Biden-era broadband label rule that required internet service providers to itemize discretionary monthly passthrough fees on consumer-facing price disclosures. The change matters for broadband sellers and customers because providers will be able to show those charges as an aggregate “up to” amount, rather than list each fee on the label itself.

The rule being changed dates to 2023, when the FCC updated its broadband-label requirements to make providers disclose more complete pricing information. The labels were created after a directive from Congress and are intended to make broadband plans easier to compare across providers.

FCC Chair Brendan Carr said the prior approach made labels harder to use and increased compliance costs. In a commission press release, the FCC said the earlier rules produced labels that were “sometimes-confusing” and went beyond the statutory framework Congress set. Carr said providers will still have to offer a label for every standalone broadband plan, including information on pricing, introductory rates, speeds and data allowances.

Compromise changes keep some fee detail

The final order was approved after changes to Carr’s draft proposal, though the commission had not yet released the full final text. Democrat Anna Gomez joined the Republican majority while saying she would have preferred to keep full fee itemization.

Gomez said the revised labels will include descriptions for fees sent to state and local governments and for fees sent to third parties. Consumers will also be able to click through to more information about the kinds of fees and how providers describe their use.

According to Gomez’s office, the aggregate passthrough-fee line will include two subcategories: one for amounts remitted to state and local governments and one for amounts remitted to third parties. Each category will list types of passthrough fees and link to a provider-managed webpage explaining items such as E911 fees or pole attachment fees.

That is narrower than full itemization, but more detailed than Carr’s draft order, which would have allowed providers to show only a single maximum figure for passthrough charges.

Labels will be easier for providers to hide behind links

The FCC also approved a change that allows providers to use a hyperlink or icon for broadband labels on ordering pages and account portals, rather than displaying the full label prominently. Gomez said the order retains a requirement that labels be available in customer account portals, but narrows the display obligation.

Passthrough fees are distinct from taxes. In Carr’s draft order, the FCC described them as charges imposed by government entities or third-party infrastructure owners, including state and local right-of-way fees and pole attachment fees. The agency also said providers choose to pass those costs to customers rather than include them in the base monthly price.

Broadband industry group USTelecom had argued that itemization forced providers to create and update large numbers of labels because fees vary by geography and customer address. The new rule accepts that operational complaint while preserving a less granular disclosure regime.

The commission also changed phone-sales requirements. Customer service representatives may discuss the label conversationally rather than read it verbatim, the FCC said. Gomez said phone calls must still include critical information such as monthly price including monthly fees, introductory-rate duration, typical download and upload speeds, latency, data allowance, contract term and early termination fees.

If the implementation schedule from the draft order remains unchanged, the new rules will take effect 30 days after publication in the Federal Register.

This story draws on original reporting from Ars Technica.