Below you will find the introduction to "Broadband Truth-In-Labeling: Empowering Consumer Choice Through Standardized Disclosure," a policy brief by the Open Technology Institute. Download the entire PDF version here.
As a consumer in the United States, it is extraordinarily difficult to make informed decisions about Internet service providers (ISPs) and their offerings. As recently as June 2015, the American Consumer Satisfaction Index (ACSI) found that customer satisfaction with ISP websites is 66%, “well below the national average” of 77.9% for websites overall.1 The Federal Communications Commission (FCC) also reports widespread consumer confusion over ISPs’ offerings. In the 2015 Open Internet Order, the FCC noted “numerous complaints from consumers” regarding ISP disclosures, and explained, “consumers continue to express concern that the speed of their service falls short of advertised speeds, that billed amounts are greater than advertised rates, and that consumers are unable to determine the source of slow or congested service.”
This is not a new problem. The Open Technology Institute (OTI) reported widespread confusion several years ago, and in 2009 we called for the implementation of a “Broadband Truth-in-Labeling” program to encourage ISPs to present information about their service packages in a uniform format that would enable consumers to better understand and compare offerings from different ISPs.
The FCC has worked to address consumer confusion and related problems. FCC regulations detail the disclosures that ISPs must make to the public regarding their services, and the FCC updated these regulations as part of the 2015 Open Internet Order. Recognizing the value of a standardized disclosure format that facilitates side-by- side comparisons, and citing both OTI’s Broadband Truth- in-Labeling proposal and related recommendations from the Open Internet Advisory Committee, as part of the Order the FCC also established “a voluntary safe harbor for the format and nature of the required disclosure to consumers.”4 But the FCC noted that the record “was lacking on specific details as to how such a disclosure should be formatted” and declined to mandate the exact format at that time. Instead, the FCC directed its Consumer Advisory Committee to “formulate and submit to the Commission a proposed disclosure format, based on input from a broad range of stakeholders” by the end of October 2015.
In what hopefully will be a useful resource as the FCC and Consumer Advisory Committee work to develop a standardized disclosure format for the voluntary safe harbor established by the 2015 Open Internet Order, this document updates the original Broadband Truth-in- Labeling proposal first offered by OTI in 2009. The new format has been redesigned to reflect the FCC’s current rules on ISP transparency. This format also takes into consideration research regarding consumer decision- making, as well as OTI’s unique experience examining ISPs disclosures to collect the information used to inform OTI’s annual Cost of Connectivity reports.