FCC Creates Broadband 'Nutrition Labels' For Consumers - InformationWeek

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Government // Open Government

FCC Creates Broadband 'Nutrition Labels' For Consumers

The FCC has released Broadband Facts, which mimic the design of nutrition labels and serve much the same function: To help consumers know what they're buying and if it's good for them. The FCC receives 2,000 complaints a year from people unpleasantly surprised by their broadband bills.

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The Federal Communications Commission (FCC) has introduced the equivalent of nutrition labels for mobile and fixed broadband Internet service in order to help consumers make more informed decisions about what they actually pay and what they get for that money.

The average monthly cost of broadband service in the US, according to the FCC, is between $60 and $70.

"Customers deserve to know the price they will actually pay for a service and to be fully aware of other components such as data limits and performance factors before they sign up for service," FCC Chairman Tom Wheeler wrote in an April 4 statement.

The labels include information about:

  • Price: This includes monthly charges; equipment, early termination, and administrative fees; one-time fees; and charges such as those for overages.
  • Data allowance: Clear information about the point at which consumers will face the "consequences" of their data use, whether those are fees or slowed data speeds.
  • Performance: This includes speed and other performance metrics. The Broadband Facts label for mobile broadband includes details such as "application-specific network management practices" that a consumer might follow for best results. The Fixed Broadband label includes details such as typical latency and typical upstream and downstream speeds.

Also released were a set of labels for broadband providers that offer instructions on how to fill out the labels.

(Image: RGAP/iStockphoto)

(Image: RGAP/iStockphoto)

Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), commended the labels in the FCC statement and invoked a phrase that the bureau has applied to campaigns around bringing clarity to processes including mortgages, student loans, and prepaid cards: "Consumers deserve to know before they owe."

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The information labels are not mandatory, but Internet providers can begin using them immediately. They follow the 2015 Open Internet Order, which recommended clearer and fuller disclosure of broadband providers' network performance and practices.

According to the FCC, more than 2,000 people complain to the agency annually about surprise fees associated with their Internet bills. The actual prices charged can be more than 40% higher, after fees and taxes, than the advertised price.

"This action represents important follow-through on the FCC's principles of transparency in a straightforward format. The familiar 'nutritional label' easily allows the average consumer to understand exactly what they are getting from their broadband providers," Kate Forscey, associate counsel for government affairs at consumer watchdog Public Knowledge, wrote in a blog post applauding the labels.

She added: "This should grant providers some of the certainty that they have been calling for in the ongoing conversation regarding ensuring Internet openness in the digital age."

In May 2015, the US Government Accountability Office released a 42-page report recommending that the FCC, which oversees broadband regulation, take steps to ensure consumers have clear information about broadband services, and that the Commission set performance goals and measurements for such steps.

Michelle Maisto is a writer, a reader, a plotter, a cook, and a thinker whose career has revolved around food and technology. She has been, among other things, the editor-in-chief of Mobile Enterprise Magazine, a reporter on consumer mobile products and wireless networks for ... View Full Bio

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User Rank: Ninja
4/5/2016 | 1:57:57 PM
Junk services
I think I'll like these labels. This is a great way to display actual usage and pricing information in an already easy-to-read format. It would be even better if the really awful providers got better...
User Rank: Apprentice
4/5/2016 | 1:56:54 PM
I expected a bit more from FCC, I am a little bit disapointed
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