Get ready for the FCC’s broadband ‘nutrition labels’
The Federal Communications Commission (FCC) has paved the way for new requirements that will require Internet Service Providers (ISPs) and broadband companies to provide “nutrition labels,” clearly outlining their services and fees to existing customers and potentials.
Nutrition labels are a requirement for most food products in the United States. A nutrition label gives the customer a clear, easy-to-read way to know what the food they are buying contains, its nutritional value and any potential ingredients they may be allergic to. These labels are an important resource for customers to make comparison purchases, choosing the product that best suits their needs.
The FCC clearly sees the value of this practice and wants to apply the concept to the broadband industry, as companies are required to provide such a label on their services. The aim is to make it easier for customers to understand exactly what they are buying, the services provided to them, the limits of those services and the exact cost.
why it matters
Given that there are relatively few industries that have nutrition labeling equivalents, some may wonder why the FCC wants to impose them on the broadband industry. Ultimately, ISPs have only themselves to blame for the FCC’s plans. For years, the internet and broadband industry has consistently ranked among the most hated in the United States.
A number of factors have contributed to this, including the habit of charging hidden fees which significantly increase the price over what is advertised. Additionally, the industry has a habit of charging equipment rental fees even if the user provides their own modem, router, and other equipment, essentially forcing customers to pay a monthly fee for nothing.
Beyond that, service providers often entice users with bait and switch pricing, enticing them with a low price that increases dramatically after the first six months or year of service. Similarly, ISPs often advertise broadband access, only to deliver services well below what they promise.
Another particularly big issue involves marketing, with companies sometimes using misleading verbiage to describe data caps, which can lead to limited speeds or unexpected charges. In light of this, the FCC is finally getting involved in an effort to force ISPs to be more transparent with their customers, giving them a better idea of what they’re paying for.
what people say
When describing the proposed broadband labels, FCC Chairman Jessica Rosenworcel compared them to nutrition labels on food before saying:
I think the Federal Communications Commission needs to do the same with broadband. That’s because it’s now an essential service, for everyone, everywhere. So we want to make it easier for consumers to compare their options and understand what they’re getting into. We want to develop a consistent and simple way to provide accurate information about price, speed, data allowances, and other aspects of high-speed service. We want to end efforts to bury the facts in the fine print and we want to stop unforeseen costs and fees.
Consumer groups also hailed the decision as one that will ultimately benefit users, especially at a time when internet access is more important than ever. Jonathan Schwantes, senior policy adviser at Consumer Reports, described how ISPs have been opaque with their billing practices, charging hidden fees, using confusing language and fine print, all in an effort to keep customers in the dark. ignoring.
“A broadband label is a great tool to increase transparency and help consumers better understand what they’re paying for with their internet plan,” Schwantes said. “And for those lucky consumers who have ISP choice, a clear, consistent label will allow those consumers to shop around.”
Most broadband providers have been relatively tight-lipped about the FCC’s decision, though odds are few are happy with it. ISPs earn billions of dollars from fees alone. In fact, according to T-Mobile — one of the only major providers to clearly identify costs — ISPs have charged Americans more than $9 billion in additional fees beyond what their internet service cost in 2020.
If the FCC’s plans go ahead, it will be one of the most significant steps ever taken to crack down on predatory ISP practices and protect their customers.