FCC Extends Net Neutrality Transparency Exemption for Year
The FCC extended for another year, until Dec. 15, 2016, a temporary small-business exemption from the net neutrality order’s enhanced transparency reporting requirements. The exemption provides relief for ISPs with 100,000 or fewer broadband subscribers. Without further action, it was to end Tuesday. The FCC released the order Tuesday, as expected (see 1512140048). Chairman Tom Wheeler promised to seek a commission vote on the exemption next December.
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House Republicans immediately slammed the order, saying the exemption should have instead been made permanent. Commissioner Mike O’Rielly said that merely extending the exemption is a “monumental mistake in judgment.”
Transparency provisions in the 2010 order remain in effect. The 2015 order added a requirement that broadband providers always disclose promotional rates, all fees and surcharges, as well as data caps or data allowances. The order also added packet loss as a measure of network performance that must be disclosed. The enhanced requirements are still under review by the Office of Management and Budget and have yet to kick in for any provider.
The Consumer and Governmental Affairs Bureau, which issued the order, said it found that “at this time it cannot fully evaluate the impact of removing the temporary exemption.” CGB said the FCC hasn't made a finding on the burden on industry posed by the requirement. The agency in May sought comment on that issue in light of the 1995 Paperwork Reduction Act (PRA), CGB said. In another year “the PRA process will be complete and … the full Commission will be able to consider whether and, if so, how best to extend the temporary exemption from the enhanced transparency requirements with the benefit of more complete information,” the bureau said.
The bureau said customers of small ISPs also would benefit from increased transparency. “It is a matter of historical record that Open Internet issues do not necessarily concern the actions of only large broadband providers,” the order said. The bureau said it decided to stick with the 100,000-subscriber threshold as the cutoff for the exemption. “Moving from a threshold of 100,000 to 500,000 or fewer connections to qualify for the exemption would nearly double the number of connections served by exempted providers,” it said.
Small ISPs “never had the imaginary market power envisioned by the Commission, and they shouldn’t have to comply now or in the future with burdensome requirements that divert limited resources from broadband deployment and provide no real value to consumers,” O’Rielly said in a statement. The full commission should have been asked to vote, even though the commission majority approved issuing the order on delegated authority by CGB, he said.
Wheeler said he's concerned about protecting nearly 7 million subscribers who buy services from exempt ISPs. “It would be premature to end the temporary exemption until the Bureau has had sufficient time to conduct a data-driven review of the burden through the PRA process,” he said.
Commissioner Mignon Clyburn said she backed the exemption, but agreed no final decision should be made until all the facts are in. “Increased transparency is always beneficial and we have a duty to ensure that the benefits outweigh the burdens, particularly for our small businesses,” she said.
“Permanent protection should have been an easy call, but the FCC fumbled it,” said House Commerce Committee Chairman Fred Upton, R-Mich. Consumers will be hurt if small ISPs have to spend money to comply with the rules, he said in a statement. “The FCC should save the red tape for Christmas, not our small businesses.”
“Small businesses across the country have more than enough on their plate without the prospect of new regulations from unelected bureaucrats in Washington,” said House Small Business Committee Chairman Steve Chabot, R-Ohio.
The Wireless ISP Association, which had urged a permanent exemption, nonetheless was pleased. “The public record overwhelmingly supports a permanent exemption, and we are cautiously optimistic that the FCC commissioners ultimately will follow the strong record in support of a permanent exemption,” said WISPA President Alex Phillips. American Cable Association President Matthew Polka said the FCC was right to extend the exemption “even though ACA believes the record supported a permanent exemption now.”