CTIA’s Largent Urges FCC To Deny NASUCA Petition

The FCC plans to act at its March 10 meeting on the order, declaratory ruling and 3nd further NPRM regarding the truth-in-billing (TIB) rules and the NASUCA petition (CD March 4 p1). The Commission is expected to impose obligations on carriers to make full, truthful disclosures of items on consumer bills. But the circulated order preempts states on line items in bills, and the draft further-NPRM tentatively concludes states can’t adopt rules more restrictive than federal regulations, according to sources.

Largent said in the letter he was “afraid” that preventing wireless carriers from using line items -- “their best mode of communication with their customers” -- would lead to state and local regulatory authorities’ imposing more taxes, fees and surcharges on wireless carriers. “These costs ultimately will be passed through to consumers through higher rates,” he said: “Such added costs will artificially suppress demand for the new and innovative products and services that wireless carriers offer their customers. This is the wrong result for consumers.”

Meanwhile, the FCC said Fri. billing and rate complaints dropped more than 50% in the 4th quarter, driving a “sharp” decline in total wireless complaints to 4,369 from 9,120 (see separate note this issue). That compares to the “biggest” increase from 3,732 to 4,927 in billing and rate complaints recorded in the 3rd quarter, when total wireless complaints rose from 7,159 to 9,120. In the 4th quarter, the Commission said there was a “modest” increase in the number of wireless inquiries to 10,383 from 10,237, driven by increase in the billing and rates complaints. That compares to a decrease in wireless inquiries from 11,575 to 10,237 3rd quarter.

Largent said state-by-state regulation of wireless carrier line-items would result in “more inconsistent and more confusing customers bills, result in consumers having less information about the nature of charges on their bills, and will impose additional costs on the industry that inevitably [will] be passed through to consumers in the form of higher service-rated charges.”

The National Taxpayers Union (NTU) sided with the wireless industry, saying “any government imposed restrictions on wireless service providers’ ability to delineate for consumers the cost of providing such services -- be they explicit or implicit -- are unwarranted restrictions and not in the best interest of consumers. Besides wreaking havoc on a wireless service provider’s ability to offer mutually beneficial package plans, consumers will be left in the dark as to what costs they are ultimately being forced to bear by their elected officials.”

States and consumer groups vigorously opposed the wireless industry position and urged the FCC to grant the NASUCA petition. “We do not support measures that preempt a states ability to provide consumers with additional protections,” NARUC told FCC officials last week: “Preemption of additional state oversight of line items and billing formats, whether specified in the order, or suggested in the proposed rulemaking, is not in the consumer’s benefit.” NARUC said Sec. 332 of the Communications Act “rate” preemption was “not the correct vehicle to preempt state authority on this matter. Expanding the definition of what constitutes ‘ratemaking’ under that section to cover valid state exercises controlling billing format that have little to do with the recovery or rate charged an end-user is inconsistent with the legislative history and the text of the Act.” NARUC officials also asked the FCC to delay a vote on the issue to give parties more time to “fully brief and or discuss the matter” with the Commission.

Vt. Public Service Board echoed NARUC’s concerns, saying federal preemption of wireless billing layouts was “contrary to the intent of Congress and is likely ro conflict needlessly with state taxation powers. It would also undermine a pending rulemaking regarding operation of the Vermont Universal Service Fund.” The board also said: “As we understand the scope of the possible preemption, it appears to be inconsistent with the intent of Section 332(c)(3). The plain language of Section 332 reserves state authority over terms and conditions, while proscribing only state regulation of entry and rates.”

AARP reiterated its “strong support” for the NASUCA petition and urged the FCC to reject any order that weakens it. It said it was concerned the FCC “might act to undermine the original pro-consumer intent of the petition and unnecessarily preempt state regulators’ ability to protect telecommunications consumers.” AARP also said that while it would support action by the FCC to remove the original TIB order’s exemption of wireless carriers from the requirement that bills include “brief, concise, separate and truthful descriptions of billed charges,” “taking this action at the expense of state regulators’ ability to protect their consumers is an unnecessary federal preemption. This trade-off comes at too high a cost for consumers.”

NASUCA urged the FCC not to preempt state commissions from regulating wireless carriers use of “regulatory” line items: “NASUCA hopes that the Commission will not turn this opportunity into a nightmare for consumers and state regulators by reducing or eliminating consumer protections at the state level while doing virtually nothing to increase protection at the federal level.”