FCC Way Off on Cost of Key Change to Net Neutrality Rules, Industry Groups Say
CTIA, USTelecom and other industry groups told the Office of Management and Budget that FCC estimates on the costs of complying with the 2015 “enhancements” to transparency parts of 2015 net neutrality rules are inadequate and should be rejected. OMB sought comment under the Paperwork Reduction Act. The comments were filed at OMB and in FCC docket 14-28.
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CTIA slammed FCC estimates that the enhanced rule will add just 6.8 hours per year per respondent -- from 24.4 hours per year to 31.2 hours per year -- to the time it takes to respond. CTIA said the FCC also estimated an average extra cost of $1,701.72. The FCC relies “exclusively on in-house personnel, rejecting showings of CTIA and others and refusing to recognize any costs for outside counsel or consultants,” the group said.
“The Commission has already demonstrated that potential liabilities for a failure to comply with the Open Internet transparency requirements are astronomical,” CTIA said. The group cited a proposed fine of $100 million against AT&T Mobility for allegedly throttling the speed of data connections of subscribers with unlimited data plans (see 1506170050). “Given the magnitude of the risks facing broadband providers, it is absurd for the Commission to suggest that these providers will spend just 6.8 hours more per year to ensure compliance with the ‘enhanced’ transparency requirements,” CTIA said. “Nor is it credible to expect that providers will try to devise programs and procedures to comply with the enhanced transparency requirements without substantial guidance from outside counsel or consultants.”
AT&T said costs will be especially high for wireless carriers. To comply with the new transparency requirements, “wireless providers will have to measure something they have not been required to measure or report previously (packet loss), in geographic areas where they do not currently take any similar performance measurements and may not have previously measured, and during undefined ‘peak hour’ time periods,” said a blog post Tuesday by Hank Hultquist, vice president-federal regulatory. For AT&T, “compliance with this requirement would cost far more than the FCC is estimating,” Hultquist wrote. “Indeed, it could very well cost AT&T alone more than what the FCC has estimated for the entire industry to comply with all of the FCC’s transparency requirements because it could require extensive additional drive testing at a cost of many millions of dollars each year.”
USTelecom said the FCC largely ignored industry comments and said the agency's faulty explanations didn't address concerns. Despite the opposition to initial information collection burden estimates, "its ‘revised’ burden estimates continue to fall well short of what broadband Internet access service providers will have to do to comply with them," the association commented. "The Commission’s Modified Proposal continues to ignore its obligation to consider, among other things, the time, effort, and cost required to train personnel to be able to respond to the collection; to acquire, install, and develop systems and technology to collect, validate, and verify the requested information; to process and maintain the required information; and to make the required information available to customers."
The American Cable Association said it appreciated the FCC reducing some burdens, but ACA said many requirements remain and will impose significant costs on smaller ISPs. "With respect to the collection and disclosure of additional information about network practices, smaller providers believe this will require the continuous expenditure of time and resources because these practices and their effects on customers and other entities in the Internet ecosystem will evolve as new types of traffic and traffic flows emerge as new content, applications, and devices that connect to the network are offered and customers alter the services they access, requiring frequent review and revision of each operator’s disclosures," ACA commented. It estimated the annual related work time at about 20 hours.
The Wireless ISP Association said commission estimates are based on “flawed and unsupported assumptions that grossly underestimate the information collection burdens and costs.” Smaller providers are under exemption from the requirement, expiring in just months, WISPA said. “Though the Commission undoubtedly wishes it were not so, its burden estimates are inaccurate and cannot be the basis for imposing enhanced disclosure obligations on small businesses.”