Federal Communications Commission

On August 25, 2016, House Small Business Committee Chairman Steve Chabot (R-OH) and Ranking Member Nydia Velazquez (D-NY) wrote to Federal Communications Commission Chairman Tom Wheeler to express concern that the FCC's privacy proposals will result in rules that have a negative economic impact on small Broadband Internet Access Service (BIAS) providers.

On Oct 4, Chairman Wheeler responded by saying, "The Commission continues to engage in a regulatory flexibility analysis for this ongoing proceeding. When final rules are adopted, the Commission's decision will incorporate consideration of the impacts of the rules on small BIAS providers and will include a Final Regulatory Flexibility Analysis (FRFA) that fulfills the requirements of the Regulatory Flexibility Act. The comments submitted by the US Small Business Administration's Office of Advocacy will be addressed in the FRFA."

High-speed Internet access, or broadband, has enabled the democratization of entrepreneurship. Way back when, if you had a good idea, the odds were against you reaching success at scale unless you worked in a large organization, had personal connections, or otherwise hit the lottery. But today, with a powerful plan and a digital connection, you can raise capital, start a business, immediately reach a worldwide customer base, and disrupt an entire industry. Never before has there been such opportunity for entrepreneurs with drive and determination to transcend their individual circumstances and transform our country.

I want to think big about how to bring broadband to every part of the country. I want to discuss how government at all levels can help spur more entrepreneurship and innovation. In short, I want to share my vision of a Digital Empowerment Agenda that will allow all Americans—no matter what their race, religion, gender, or sexual orientation, no matter where they live, no matter what their personal background—to make their lives better.

The Federal Communications Commission’s Enforcement Bureau announced that Comcast Corporation will pay a $2.3 million fine to resolve an investigation into whether the company wrongfully charged cable TV customers for services and equipment that those customers never authorized. The Communications Act and the FCC’s rules prohibit a cable provider from charging its subscribers for services or equipment they did not affirmatively request, a practice known as “negative option billing.” Negative option billing burdens customers with the responsibility of contacting a cable company to dispute the charges and obtain refunds. The Communications Act and the FCC’s rules prohibit a similar practice by telecommunications carriers when unauthorized charges are placed on customers’ phone bills, an abuse known as “cramming.”

The Commission received numerous complaints from consumers alleging that Comcast added charges to their bills for unordered services or products, such as premium channels, set-top boxes, or digital video recorders (DVRs). In some complaints, subscribers claimed that they were billed despite specifically declining service or equipment upgrades offered by Comcast. In others, customers claimed that they had no knowledge of the unauthorized charges until they received unordered equipment in the mail, obtained notifications of unrequested account changes by email, or conducted a review of their monthly bills. Consumers described expending significant time and energy to attempt to remove the unauthorized charges from their bills and obtain refunds. In response to these complaints, the FCC undertook an investigation of the company. Under the terms of the settlement, Comcast will pay the largest civil penalty assessed from a cable operator by the FCC and implement a five-year compliance plan.

Speaking to the Kansas Association of Broadcasters, Federal Communications Commission member Ajit Pai said, “I can’t help but mention the FCC’s decision this year to retain the newspaper-broadcast cross-ownership rule. Put simply, it makes no sense for the federal government to discourage investment in the newspaper industry. But that’s precisely what the newspaper-broadcast cross-ownership rule does. It’s particularly unfortunate because broadcasters are well-situated to partner with newspapers. The reason is simple. Investments in newsgathering are more likely to be profitable when a company can distribute information over multiple platforms. This is not just a theory. Because the FCC grandfathered newspaper-broadcast combinations that predated the 1975 adoption of the newspaper-broadcast cross-ownership rule, we have evidence from across the United States. There are at least 15 studies demonstrating that newspaper-television cross-ownership increases the quantity and/or quality of news broadcast by cross-owned television stations.”

The Consumer and Governmental Affairs Bureau of the Federal Communications Commission prepared this Biennial Report for submission to the House and Senate Commerce Committees in accordance with the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA).

This Report presents information and assessments related to the accessibility of telecommunications services and equipment, advanced communications services (ACS) and equipment used for ACS, and Internet browsers built into mobile phones, along with a summary of actions taken by the Commission related to the CVAA. Specifically, this Report presents information and assessments related to the accessibility of telecommunications services and equipment as required by section 255,14 ACS and equipment used for ACS as required by section 716,15 and Internet browsers built into mobile phones as required by section 718,16 since the submission of the 2014 CVAA Biennial Report. In addition, this Report provides information about complaints alleging violations of sections 255, 716, and 718 for the period of January 1, 2014, through December 31, 2015.

To promote fairness, competition, and investment in this $45 billion marketplace, Federal Communications Commission Chairman Tom Wheeler circulated to his fellow Commissioners proposed rules to take necessary and overdue steps to reform a long-broken regulatory regime.

The Order provides a new framework for the Business Data Services (BDS or “special access”) market that strikes a balance between targeted regulation for legacy TDM (DS1 and DS3) services, where evidence of market power is strongest, and lighter-touch regulation of packet-based services, where there has been new entry and competition may be emerging. The Order also reaffirms that TDM and Ethernet BDS are both subject to the Commission’s Title II oversight. This framework supports the rapid deployment of innovative 5G mobile service by ensuring that wireless providers have fair access to BDS, including packet-based BDS, at just and reasonable rates, terms, and conditions. These requirements are enforced by strengthening our complaint process to expedite resolution of problems if they arise.

The Chairman is also proposing a Further Notice on packet-based BDS, which will provide the Commission with a vehicle to take further action on Ethernet pricing if that proves necessary. A Second Further Notice of Proposed Rulemaking would seek comment on how best to collect accurate data on market developments and what administrable means can be developed, if necessary, to deal with any concerns that may emerge with respect to pricing for packet-based BDS.

Federal Communications Commission Chairman Tom Wheeler announced that the following items are tentatively on the agenda for the October Open Commission Meeting scheduled for Thursday, October 27, 2016:

1. Protecting the Privacy of Customers of Broadband and other Telecommunications Services: The Commission will consider a Report and Order that applies the privacy requirements of the Communications Act to broadband Internet access service providers and other telecommunications services to provide broadband customers with the tools they need to make informed decisions about the use and sharing of their information by their broadband providers. (WC Docket No.16-106)
2. Deceptive Marketing: The Commission will separately consider four Memorandum Opinions and Orders that dismiss and deny Petitions for Reconsideration of four Forfeiture Orders issued by the Commission for the deceptive marketing of prepaid calling cards.

Separately, the FCC announced it has lifted the sunshine restrictions applicable to Expanding Consumers’ Video Navigation Choices (MB Docket No. 16-42); Commercial Availability of Navigation Devices (CS Docket No. 97-80) – an item that was deleted from the Commission’s Sept meeting agenda. So, talk amongst yourselves.

Earlier in 2016, the Federal Communications Commission launched a proceeding aiming to extend similar privacy protections to the information collected by your broadband provider. Our goal throughout the process has been straightforward: to give consumers the tools they need to make informed decisions about how ISPs use and share their data, and the confidence that ISPs are taking steps to keep that data secure, all while providing ISPs the flexibility they need to continue to innovate.

Over the past six months, we’ve engaged with consumer and public interest groups, fixed and mobile ISPs, advertisers, app and software developers, academics, other government actors including the FTC, and individual consumers to figure out the best approach. Based on the extensive feedback we’ve received, I am proposing new rules to provide consumers increased choice, transparency and security online. I have shared this proposal with my colleagues and the full Commission will consider these proposed privacy rules at our upcoming monthly meeting on October 27.

Under the proposed rules, an ISP would be required to notify consumers about what types of information they are collecting, specify how and for what purposes that information can be used and shared, and identify the types of entities with which the ISP shares the information. In addition, ISPs would be required to obtain affirmative “opt-in” consent before using or sharing sensitive information. Information that would be considered “sensitive” includes geo-location information, children’s information, health information, financial information, social security numbers, web browsing history, app usage history, and the content of communications such as the text of emails. All other individually identifiable information would be considered non-sensitive, and the use and sharing of that information would be subject to opt-out consent. Calibrating consent requirements to the sensitivity of the information aligns with consumer expectations and is in harmony with other key privacy frameworks and principles – including those outlined by the FTC and the Administration’s Consumer Privacy Bill of Rights. The proposed rules are designed to evolve with changing technologies, and would provide consumers with ways to easily adjust their privacy preferences over time.

The proposed rules also require ISPs to take reasonable measures to protect consumer data from breaches and other vulnerabilities. If a breach does occur, the rules would require ISPs to take appropriate steps to notify consumers that their data have been compromised.

In a letter dated April 15, 2016, to Federal Communications Commission Chairman Tom Wheeler, Senate Commerce Committee Chairman John Thune (R-SD) asked that the FCC address concerns raised by him regarding the potential violation of 47 C.F.R. § 19.735-203, pertaining to disclosure of "nonpublic information. . . directly or indirectly, to any person outside the Commission," as a complaint requiring an investigation pursuant to 47 C.F.R. § 19.73 5-107(b). Specifically, Chairman Thune expressed concern that information regarding the 2016 Lifeline Modernization Order, 31 FCC Rcd 3962 (2016), specifically news of an agreement among FCC Commissioners O'Rielly, Pai and Clyburn to vote for a hard cap on Lifeline spending set at $2 billion (the "deal" or "compromise"), appeared in the news media publications Politico and Broadcasting & Cable prior to the FCC's vote on the Lifeline Order.

Based on Investigators' review of phone records, email messages and interviews, Gigi Sohn, Counselor to the FCC Chairman, provided some of the information revealed in the Politico story that appeared at approximately 10:49 am on March 31, 2016. In an interview, Sohn revealed that Shannon Gilson, FCC Communications Director, requested that Sohn call Politico reporter Margaret McGill and inform McGill that the FCC meeting was delayed from 10:30 until 12:00 and that there was a compromise on Lifeline, including the fact that there would be an annual cap on the amount of money available in the Lifeline program. Sohn was instructed not to tell McGill the amount of the agreed-upon cap. In an interview, Gilson explained that throughout the morning of March 31st, the FCC Office of Media Relations had been inundated with calls from the press and that it was clear many reporters and stakeholders were already aware a deal was being crafted by Commissioner Clyburn and the Republican commissioners. Thus, because she felt it would be beneficial to get the story out accurately, Gilson sought and received authorization from Chairman Wheeler and Ruth Milkman, Wheeler’s Chief of Staff, to provide the press with high level details. Gilson exercised her discretion in choosing both Politico and McGill as the appropriate recipients of this information, and instructed Sohn to make the call. We have been unable to determine with certainty who provided McGill with the information on the amount of the agreed upon cap.

We found no evidence that the information was provided to the press in an attempt to unduly influence the outcome of the vote.

Federal Communications Commission Chairman Tom Wheeler has circulated to his fellow Commissioners a proposed Order to give consumers the tools they need to choose how their Internet service provider (ISP) uses and shares their personal data.

Building on widely accepted privacy principles, the rules would require that ISPs provide their customers with meaningful choice and keep customer data secure while giving ISPs the flexibility they need to continue to innovate. The rules, if adopted, would not prohibit ISPs from using or sharing their customers’ information – they would simply require ISPs to put their customers in the driver’s seat when it comes to those decisions. The approach Chairman Wheeler is recommending reflects extensive public comments received in response to the comprehensive proposal adopted by the Commission in March, including input from the Federal Trade Commission. Here's an outline of Chairman Wheeler's proposal:

• Focus is on providing consumers choice over how to protect their privacy and their children's privacy online.
• ISPs must tell customers about the collection, use, and sharing of their information.
• Prohibits "Take-it-or-leave-it" offers, meaning that an ISP can't refuse to serve customers who don't consent to the use and sharing of their information for commercial purposes.

The full Commission will vote on the proposed Order at the FCC’s October 27 Open Meeting.