New Labels Shed Light on Obscure Internet Service Details

New labels will helps customers make “informed choices” on Internet service

New labels will give customers specific details on their Internet service, according to an announcement made by the FCC.

Similar in look to nutrition labels on food products, these labels are designed to give consumers an easy way to understand Internet service provider prices, performance, and network practices conveyed in a simple-to-understand format.

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Image: FCC Image: FCC

With the new consumer broadband labels, consumers can compare the services of different broadband providers.

Labels will be available for fixed broadband service (such as cable or FIOS) as well as for cellular service.

Information on the labels includes the amount of data a customer receives with an associated service plan; fees to lease modems or gateways; tax and surcharge amounts; and typical upload and download speed of the service.

Links to more specific information such as how the Internet service provider manages its network and its privacy policy will also be on the labels.

“These labels provide consumers clarity about the broadband service they are purchasing, not only helping them to make more informed choices but also preventing surprises when the first bill arrives,” said FCC chairman Tom Wheeler. “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.”

The labels are expected to address the more than 2,000 complaints the FCC receives every year about surprise fees associated with consumers’ Internet service bills. The actual prices paid for broadband-related services can be as much as 40% greater than what is advertised after taxes and fees are added to a bill, according to consumer complaints to the Commission.

However, not everyone is on board with the FCC’s plan. The Cellular Telecommunications Industry Association (CTIA) issued a statement:

“While we appreciate that these labels will serve as a ‘safe harbor’ under the Open Internet transparency rules, CTIA members already provide disclosure and transparency as part of the Consumer Code for Wireless Service. The competitive nature of the wireless broadband market does more for consumers than regulation can hope to achieve.”

The use of these labels by Internet service providers is not mandatory. “These formats, while not mandated by the agency, are recommended by the Commission and will serve as a “safe harbor” to meet those requirements,” as per a statement released by the FCC on the labeling.