Genachowski: Power to the People!

Chairman outlines FCC's 'consumer empowerment agenda'

By John Eggerton -- Broadcasting & Cable, 10/13/2010 3:42:22 PM

Flanked by the Consumer Federation of America, Consumers Union, the National Consumers League and Consumer Action, FCC Chairman Julius Genachowski Wednesday outlined what he called the FCC's "consumer empowerment agenda" at the Center for American Progress in Washington.

As B&C reported, the chairman talked about taking steps to reduce bill shock by better informing users of potential charges. He also released findings of an FCC study that found that of the 764 people who had complained about bill shock in the first six months of 2010, 67% were complaining about amounts of $100 or more, and 20% of $1,000 or more, with the largest being $68,505.

And while bill shock is primarily a phone company issue at present, the chairman made it clear he was also looking ahead to a time when a mobile broadband bill will include online video delivery.

"We just got our first look at Google TV, and new video delivery boxes from Apple and Roku hit store shelves last week, as the way we watch video on our flat-screen HD TVs continues to evolve."

He went on to say that "The more devices we buy, the more services we subscribe to, the more perplexing it can be for consumers. Instead of tracking minutes used, something intuitive -- consumers are being asked to track megabytes of data consumed."

But the chairman went beyond that issue to talk broadly about the FCC's consumer mandate, and specifically about his concerns over early termination fees, both wireless and "increasingly," fixed broadband bundles.

He said there is a "legitimate case" for those fees for carriers who subsidize the cost of new phones, but he made no such caveat for fixed broadband and bundled services, for which he said the fees are a "fairly recent development."

Reaction to the chairman's announcement was swift.

CTIA, the association that represents wireless carriers, said it was already working to keep customers happy and informed, and would do more. But Chris Guttman-McCabe, VP of regulatory affairs, also said in a statement that CTIA was concerned that "prescriptive and costly rules that limit the creative offerings and competitive nature of the industry may threaten to offset these positive trends."

Genachowski gave a shout-out to staffers in the room representing Senator Tom Udall (D-N.M.), who has introduced a bill shock bill. Udall returned the shout-out in a statement, but urged Genachowski to go further.

"While this notification principle will go a long way toward the goal of reducing bill shock, more should be done," Udall said. "The final FCC bill shock rules would prove more effective by also requiring customer consent, or ‘opt in,' before phone companies can charge astronomical overages on top of monthly billing plans," as would his Cell Phone Bill Shock Act (S.3872).

Public Knowledge also wanted more. "We very much appreciate the action the FCC is expected to take tomorrow to protect consumers with wireless devices," said PK President Gigi Sohn. "Telling consumers promptly and in an understandable fashion when they are about to incur higher-than-normal charges is a modest requirement that will reap enormous benefits in customer goodwill. At the same time, we continue to urge the Commission to act on another item that would benefit wireless consumers - the petition we filed three years ago to provide legal protections for the content of text messages and for short codes."

PK wants the FCC to declare that text messaging and short codes (a way to send texts to large groups) are subject to the same nondiscrimination regs as voice communications.