Commentary

FCC Chips Away At Net Neutrality, Exempts 'Small' ISPs From Disclosure Rules

Many U.S. broadband carriers no longer need to disclose their practices regarding data caps, traffic management, promotional rates and surcharges, the new GOP-dominated Federal Communications Commission said today.

The agency voted 2-1 to grant a five-year exemption to so-called "small" broadband providers -- meaning those with fewer than 250,000 customers -- from a net neutrality rule requiring transparency.

The FCC first passed disclosure rules -- also known as "transparency" rules -- in 2010, when the agency enacted an earlier version of net neutrality regulations. Two years ago, when the FCC voted in favor the current net neutrality rules, the agency beefed up the transparency mandate by requiring providers to disclose a host of items related to pricing and network management practices that can affect service. 

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The disclosure rules proved important to the FCC's broadband policy under the leadership of former head Tom Wheeler. During his tenure, the agency accused T-Mobile and AT&T of violating transparency requirements by failing to disclose that customers with "unlimited" data plans could be throttled if they exceeded a monthly cap. T-Mobile settled those allegations by agreeing to pay a $48 million fine. AT&T is still fighting the charges.

Chairman Ajit Pai, who championed the decision to exempt small providers, said he wants broadband providers to "spend their limited capital building out better broadband to rural America, not hiring lawyers and accountants to fill out unnecessary paperwork demanded by Washington, D.C."

But Democratic Commissioner Mignon Clyburn characterized the move as "yet another in a series of steps being taken to jettison pro-consumer initiatives."

Sen. Ed Markey (D-Massachusetts), a leading proponent of net neutrality rules, also slammed today's vote. “Small businesses, students, entrepreneurs, and anyone else who relies on the internet should have access to the most basic and fundamental information about the broadband service for which they pay,” he stated. "Consumers deserve truth in pricing information. Instead of allowing ISPs to hide pricing information, the FCC should promote transparency so subscribers have all the background they need to make educated decisions about their broadband service.”

Today's move marks at least the second time this year that the FCC has rolled back the net neutrality rules. Earlier this month, Pai officially endorsed decisions by AT&T and Verizon to exempt their own video offerings from customers' data caps.

Net neutrality advocates, as well as the former FCC chair, took issue with zero-ratings plans offered by AT&T and Verizon. The critics argued that that carriers like AT&T shouldn't give customers incentive to watch video from affiliated companies, like DirecTV, at the expense of competing services like Netflix or Amazon Prime.

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