GAO: FCC Should Help Create UBP Code For Fixed Internet

'Commission Should Help Clear Up Usage-Based Pricing Confusion'
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A just-released GAO report on fixed broadband providers' use of usage-based pricing (UBP) recommends that the FCC work with fixed Internet access providers--cable operators are the leading providers--on a voluntary code of conduct similar to the Wireless Code of Conduct.

The study concludes the FCC should monitor fixed Internet USB and help improve consumer education.

"Because no code of conduct exists for fixed providers, there is less assurance that information provided to consumers is clear, consistent, and transparent, potentially leading to consumer confusion over data usage and poor decisions regarding data plans, GAO concluded.

The report was prepared in response to a request from Rep. Anna Eshoo (D-Calif.), ranking member of the House Communications Subcommittee.

The GAO conducted focus groups and found that consumers were more ready to accept mobile USB plans than fixed. It conceded that few fixed customers are affected by UBP, that could change as data use grows.

The report also allowed for the possibility that USB could be used to boost profits rather than manage traffic.

"Providers could implement UBP in a way that benefits consumers—for example, by offering low-data, low-cost plans for customers who do not want to pay for an unlimited data plan they do not need," it conceded, but added: "However, providers—especially those facing limited competition—could use UBP as a means to increase their profits which could result in UBP having negative effects, including increased prices paid by consumers, reductions in content and applications accessed by consumers, and increased threats to network security."

In addition to the code of conduct GAO recommends that the FCC track and study UBP implementation and its impact on customers "so that FCC can take actions, if necessary, to protect consumer interests."

“I urge the nation’s fixed broadband providers to heed the recommendations of the GAO and proactively adopt a voluntary code of conduct just as mobile providers have done," said Eshoo after the report was released. "This will improve consumer experience and ensure a more vibrant online marketplace. The FCC should also make better use of the data it is collecting on data caps to understand how best to inform consumers and promote the public interest.”

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