In an effort reminiscent of its November 2022 Order addressing Broadband Consumer Labels (see ICORE Blog of 2/10/23), on June 14, 2023, the FCC (Commission) adopted a Notice of Proposed Rulemaking regarding the need for transparency in the presentation of prices for video services by cable operators and direct broadcast satellite (DBS) providers. In this NPRM the Commission proposes to enhance pricing transparency by requiring providers to specify the “all in” price for services in their marketing materials and on consumer bills.
The Commission points out that access to clear and accurate information about the pricing of video services helps consumers make informed decisions and fosters competition in the video services marketplace. The Commission points out that often times consumers that choose a particular video service are surprised when the monthly bill arrives by the inclusion of unexpected fees that can significantly raise the monthly cost of the selected video service. These fees with names like broadcast TV fee, or regional sports programming fee are often times listed in the fine print as “fees” or “taxes and surcharges” separate from the advertised price of the video service being purchased. The Commission’s proposal in this NPRM would require providers to clearly, and prominently display the total cost of a video service. This “all in” pricing approach is intended to provide consumers with an accurate and transparent reflection of their payment obligations and eliminate unexpected fees. The proposed rules would also enhance consumers’ ability to comparison shop among competing providers.
The Commission cites Section 332 and 632 of the Act which authorize the Commission to adopt public interest regulations related to cable and DBS providers. In addition, the 2019 Television and Viewer Protection Act (TVPA) bolstered the consumer protection provisions of the Act by adding Section 642 which requires greater transparency in subscribers’ bills. In considering the TVPA, Congress expressed specific concerns regarding the unexpected and confusing fees that consumers face when purchasing video services. Consistent with these provisions of the Act the Commission proposes requiring cable and DBS providers to clearly provide the total cost of video services in their promotional materials and on customer bills. Specifically, providers would be required to aggregate the cost of the video service to include any and all amounts that the provider charges for a particular service (including fee and surcharges) as a single line on subscriber’s bills and promotional materials that include the price for a service. The Commission seeks comment on the specifics of this proposal as well as on existing federal, state, and local transparency requirements, current marketplace practices regarding advertising and billing, its legal authority to adopt this proposal, the costs and benefits of the proposal, and equity and inclusion considerations.
Comments regarding this NPRM are due within 30 days after publication of the NPRM in the Federal Register and Reply Comments are due 60 days from that date. We anticipate that there will be significant pushback against this proposal from the cable and DBS industry. We will provide updates on this issue as the proceeding evolves.