2010-29669. Empowering Consumers to Avoid Bill Shock; Consumer Information and Disclosure

AGENCY:

Federal Communications Commission.

ACTION:

Proposed rule.

SUMMARY:

In this document, the Commission proposes rules that would require mobile service providers to provide usage alerts and information that will assist consumers in avoiding unexpected charges on their bills. The Commission believes its proposals will allow consumers to understand the costs associated with use of their mobile service plans and take advantage of safeguards against bill shock by providing them with timely information to better manage those costs and thereby avoid incurring unexpected charges on their bills.

DATES:

Comments are due on or before December 27, 2010. Reply comments are due on or before January 25, 2011. Written comments on the proposed information collection requirements, subject to the Paperwork Reduction Act of 1995, Public Law 104-13 (PRA), should be submitted on or before January 25, 2011.

ADDRESSES:

You may submit comments, identified by [CG Docket No. 10-207], by any of the following methods:

■ Electronic Filers: Comments may be filed electronically using the Internet by accessing the Commission's Electronic Comment Filing System (ECFS) http://fjallfoss.fcc.gov/​ecfs2/​ or the Federal eRulemaking Portal: http://www.regulations.gov. Filers should follow the instructions provided on the Web site for submitting comments and transmit one electronic copy of the filing to each docket number referenced in the caption, which in this case is CG Docket No. 10-207. For ECFS filers, in completing the transmittal screen, filers should include their full name, U.S. Postal Service mailing address, and the applicable docket number.

Parties may also submit an electronic comment by Internet e-mail. To get filing instructions, filers should send an e-mail to [e-mail], and include the following words in the body of the message, “get form <your e-mail address>.” A sample form and directions will be sent in response.

■ Paper Filers: Parties who choose to file by paper must file an original and four copies of each filing. Because two docket numbers appear in the caption of this proceeding, filers must submit two additional copies for the additional docket number. In addition, parties must send one copy to the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Washington, DC 20554, or via e-mail to [e-mail]. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

■ All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St., SW., Room TW-A325, Washington, DC 20554. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building. The filing hours are 8 a.m. to 7 p.m.

■ Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street, SW., Washington, DC 20554.

In addition, document FCC 10-180 contains proposed information collection requirements subject to the PRA. It will be submitted to the Office of Management and Budget (OMB) for review under section 3507 of the PRA. OMB, the general public, and other Federal agencies are invited to comment on the proposed information collection requirements contained in this document. PRA comments should be submitted to Cathy Williams, Federal Communications Commission via e-mail at [e-mail] and [e-mail], and to Nicholas A. Fraser, Office of Management and Budget, via fax at [phone], or via e-mail to [e-mail].

FOR FURTHER INFORMATION CONTACT:

Richard D. Smith, Consumer and Governmental Affairs Bureau, Policy Division, at [phone] (voice), or e-mail [e-mail].

For additional information concerning the PRA information collection requirements contained in this document, contact Cathy Williams, Federal Communications Commission, at [phone], or via e-mail [e-mail].

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Empowering Consumers to Avoid Bill Shock; Consumer Information and Disclosure, Notice of Proposed Rulemaking (NPRM), document FCC 10-180, adopted and released on October 14, 2010, in CG Docket Nos. 10-207 and 09-158. The full text of document FCC 10-180 and copies of any subsequently filed documents in this matter will be available for public inspection and copying via ECFS, and during regular business hours at the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. They may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone: [phone], fax: [phone], or Internet: http://www.bcpiweb.com. Document FCC 10-180 can also be downloaded in Word or Portable Document Format (PDF) at http://www.fcc.gov/​cgb/​policy. To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an e-mail to [e-mail] or call the Consumer and Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (TTY). To view a copy of this information collection request (ICR) submitted to OMB: (1) Go to the Web page http://www.reginfo.gov/​public/​do/​PRAMain,, (2) look for the section of the Web page called “Currently Under Review,” (3) click on the downward-pointing arrow in the “Select Agency” box below the “Currently Under Review” heading, (4) select “Federal Communications Commission” from the list of agencies presented in the “Select Agency” box, (5) click the “Submit” button to the right of the “Select Agency” box, (6) when the list of FCC ICRs currently under review appears, look for the OMB control number of this ICR and then click on the ICR Reference Number. A copy of the FCC submission to OMB will be displayed.

Pursuant to 47 CFR 1.1200 et seq., this matter shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's ex parte rules. Persons making oral ex parte presentations are reminded that memoranda summarizing the presentations must contain summaries of the substances of the presentations and not merely a listing of the subjects discussed. More than a one or two sentence description of the views and arguments presented is generally required. Other rules pertaining to oral and written ex parte presentations in permit-but-disclose proceedings are set forth in 47 CFR 1.1206(b).

Initial Paperwork Reduction Act of 1995 Analysis

The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and OMB to comment on the proposed information collection requirements contained in this document, as required by the PRA. Public and agency comments are due January 25, 2011. Comments should address: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the Commission seeks specific comment on how it may “further reduce the information collection burden for small business concerns with fewer than 25 employees.”

OMB Control Number: 3060-XXXX.

Title: Empowering Consumers to Avoid Bill Shock; Consumer Information and Disclosure, CG Docket Nos. 10-207 and 09-158.

Form No.: N/A.

Type of Review: New collection.

Respondents: Business or other for-profit entities.

Number of Respondents and Responses: 1,500 respondents and 3,000 responses.

Estimated Time per Response: 40 to 100 hours.

Frequency of Response: On occasion reporting requirement; Third party disclosure requirement.

Obligation to Respond: Required to obtain or retain benefits. The statutory authority for these proposed information collections is found at sections 1-2, 4, 201, 258, 301, 303, 332, and 403 of the Communications Act of 1934, as amended.

Total Annual Burden: 210,000 hours.

Total Annual Costs: $10,000,000.

Nature and Extent of Confidentiality: An assurance of confidentiality is not offered because this information collection does not require the collection of personally identifiable information from individuals.

Privacy Act Impact Assessment: No impact(s).

Needs and Uses: In document FCC 10-180, the Commission proposes rules that would require mobile service providers to provide usage alerts, such as voice or text messages, to subscribers when they are approaching or reach an allotted limit of voice, text or data usage or are incurring international or roaming charges. In addition, the Commission proposes that mobile service providers make clear and ongoing disclosure of any tools they offer which allow subscribers to set usage limits or monitor usage balances. The provision of this information in a timely and easily accessible manner will allow consumers to avoid incurring sudden, unexpected charges on their wireless bills.

Synopsis

In document FCC 10-180, the Commission proposes that mobile providers actively provide consumers with notification messages to assist them in managing the costs of using their service and ensure that subscribers are not shocked by overage or roaming charges. Specifically, the Commission proposes that mobile providers provide notification when a subscriber is approaching their plan's allotted limit for voice, text, or data usage. The Commission seeks comment on whether such notifications should be provided in “real time,” including any technical limitations or other considerations that should be taken into consideration when reviewing this issue. How should such notifications be provided in the case of multi-line family plans? The Commission seeks comment on the most effective way to provide this notification to consumers, including methods such as providing voice or text alerts. In addition, the Commission seeks comment on whether we should establish a precise usage level at which this initial notification message would be triggered. In reviewing this issue, the Commission seeks comment on the utility of providing multiple usage alerts to the consumer against the potential burdens to the wireless providers—particularly smaller providers—who must supply them. The Commission seeks comment on whether there are aspects of the existing usage alert systems or other tools that have proven particularly helpful to consumers in avoiding bill shock that it should consider incorporating in any rule it adopts to reduce bill shock. Alternatively, are there aspects of those tools that have reduced their effectiveness for consumers and should not be adopted? The Commission also seeks comment on what it can learn from the experience with bill shock regulation in the European Union.

In addition, the Commission proposes that mobile providers supply a notification message to consumers once they reach their monthly allotment limit and begin incurring overage charges. The Commission seeks comment on whether it is sufficient to notify consumers that they have begun incurring overage charges or whether specific cost information and cut off mechanisms such as these would also be useful to consumers or create additional challenges. In that regard, the Commission seeks to balance consumer protections and expectations with the costs and technical limitations that might arise by imposing any additional requirements. In this regard, are there concerns or issues the Commission should consider with respect to smaller, regional and/or rural mobile providers? Moreover, the Commission does not intend for any alert system to hamper the ability of consumers to complete critical voice or data communications such as access to E911, and seeks comment on how to avoid such effects. In addition, the Commission seeks comment on whether consumers should be allowed to opt-out if they determine that they do not want to receive these mandatory usage alerts from their mobile service provider.

Similarly, the Commission proposes that mobile service providers supply a notification message to consumers when they are about to incur international or other roaming charges in excess of their normal rates. The Commission seeks comment on the technical feasibility of providing such international alerts, including whether such alerts require, in any way, the international provider's cooperation or any changes to its network. How often should such international alerts be provided? For example, should an alert be provided every time a consumer is about to incur international roaming charges? Should the Commission also require mobile providers to better disclose how to turn off any mobile device function that cause them to incur roaming charges? Several industry commenters contend that domestic roaming in the United States presents fewer difficulties to consumers because there is little or no domestic roaming for many subscribers. To what extent, if any, should this factor into our analysis? For example, should any roaming notification requirement be limited to international situations? Or should notification also be required for regional providers that use partners for domestic roaming? In addition, the Commission seeks comment on whether such notifications should include the applicable rates and associated charges for international or roaming charges, including any technical limitations—particularly for smaller providers—of providing this level of information in real time.

The Commission seeks comment on the length of time that would be required for mobile providers to implement any such usage alert requirement based upon a proposal that requires providers to notify subscribers when they are approaching and then reach the 100 percent threshold mark of their monthly usage allotment. Based on the comments received in response to the Bill Shock PN, published at 75 FR 28249, May 20, 2010, it may be easier for the national providers to start providing alerts. As a result, the Commission seeks comment on whether there are concerns, issues or cost considerations to implement such usage alerts that it should consider with respect to smaller, regional and/or rural mobile providers. Is there a need for varying implementation schedules between the larger and smaller, regional and/or rural providers to alleviate the burden for smaller providers? If so, what are the exact timeframes by which providers could modify their existing systems to comply with this requirement? Alternatively, should the Commission consider exempting smaller, regional and/or rural providers from any usage alert or roaming requirement due to the costs such a requirement might impose on them? If so, what size providers should this exemption apply to?

Methods for Reviewing and Capping Usage

The Commission proposes that mobile providers make clear, conspicuous and ongoing disclosure of any tools they offer which allow subscribers to either limit usage or monitor usage history. The Commission seeks additional information about the methods available for monitoring usage balances and ways to limit usage available to subscribers of smaller, regional, and rural mobile providers. Specifically, the Commission seeks comment on the best methods to ensure that consumers are made aware of the available tools for monitoring usage balances and limiting usage, how to access these tools and any applicable charges. For example, should mobile providers be required to provide this information on their bills or in annual bill inserts? What would be the most cost effective way to better ensure that consumers have access to this information and make full use of the currently available tools that can protect subscribers from bill shock? In particular, the Commission seeks comment on these issues as they relate to consumers with disabilities. What is the best method to minimize costs for smaller, regional and/or rural mobile providers while ensuring their customers have access to this information? The Commission seeks comment on how effective the existing usage controls have been in helping consumers avoid bill shock. The Commission also seeks comment on the extent to which the effectiveness of usage controls is impacted by the conditions under which they are provided to consumers. To the extent that existing usage control tools have proven effective in addressing bill shock, the Commission seeks comment on whether it should explore the possibility of mandating that all mobile service providers offer consumers the means to set their own usage limits. For example, should consumers be allowed to cap their usage in advance at a level specified by the customer (either for individual users or the entire account) or allowed to opt-out entirely of certain services (e.g. text messages) so that they cannot incur charges for any service that they don't want. Would such a requirement be overly burdensome for smaller, regional and rural providers?

Prepaid Services

The Commission seeks comment on whether prepaid mobile services should be exempt from any usage alert requirements that might evolve from this proceeding to address consumer bill shock. Prepaid services include traditional, pay-as-you-go services, in which customers buy minutes ahead of time on a card, as well as unlimited prepaid services, in which customers pay in advance for unlimited voice and/or data services each month with no long-term contract. The Commission seeks comment on these analyses, including those situations in which prepaid service users might benefit from receiving usage alerts. The Commission asks that parties distinguish between traditional, pay-as-you-go and unlimited prepaid services in their comments.

Scope of Covered Entities and Services and Legal Authority

The Commission seeks comment on the types of wireless services that should be covered by our proposals. Should any rules the Commission adopts apply to all communications services provided by mobile wireless providers, including voice, text, and data services? Should providers of mobile data services that do not also offer Commercial Mobile Radio Service (CMRS) be included? Although mobile data services may be provided by companies that are also CMRS carriers, such services may also be provided by entities that do not offer any CMRS. Therefore, the Commission seeks comment on whether the scope of covered entities should be broader than CMRS providers. On the other hand, are there services for which these rules are not necessary?

Next, the Commission seeks comment on the best sources of authority for the Commission to adopt bill shock related obligations for the different types of mobile wireless services. Several provisions of Title III provide the Commission authority to establish license conditions in the public interest. In addition, to the extent that some of the mobile services covered by the rules promulgated in this proceeding are common carrier or telecommunications services, what other provisions of the Act, in Title II or elsewhere, would provide the Commission additional authority to impose bill shock-related obligations? What other authority-related issues should the Commission consider?

Initial Regulatory Flexibility Analysis

As required by the Regulatory Flexibility Act of 1980, as amended, (RFA), the Commission has prepared this Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on a substantial number of small entities by the policies and rules proposed in document FCC 10-180. Written public comments are requested on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadlines for comments on document FCC 10-180 provided on the first page of this document. The Commission will send a copy of document FCC 10-180, including this IRFA, to the Chief Counsel for Advocacy of the Small Business Administration.

Need for, and Objectives of, the Proposed Rules

In document FCC 10-180, the Commission summarized the record compiled in response to the Consumer Information NOI and Bill Shock PN indicating that mobile consumers receive inadequate usage-related information to manage the costs associated with their mobile service plans. Recent reports from both GAO and the Better Business Bureau confirm that wireless consumers continue to experience problems with unexpected charges appearing on their bills. In many cases, these charges result from consumers unknowingly exceeding a monthly allotment limit and incurring substantial overage charges. These charges can result in significant expenditures of time, effort, and money for more than 270 million American consumers that use mobile services. In the document FCC 10-180, the Commission seeks comment on proposals designed to empower consumers to avoid bill shock by ensuring that they receive baseline information about their monthly usage balances in a timely and consistent manner to make informed decisions regarding the costs associated with their mobile service.

Legal Basis

The legal basis for any action that may be taken pursuant to document FCC 10-180 is contained in sections 1-2, 4, 201, 258, 301, 303, 332 and 403 of the Communications Act of 1934, as amended 47 U.S.C. 151-152, 154, 201, 258, 301, 303, 332 and 403.

Description and Estimate of the Number of Small Entities to Which the Proposed Rules Will Apply

The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that will be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. Under the Small Business Act, a “small business concern” is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) meets any additional criteria established by the Small Business Administration (SBA). Nationwide, there are a total of approximately 29.6 million small businesses, according to the SBA. The document FCC 10-180 seeks comment generally on mobile providers of voice, text and data services. However, as noted in section IV of the document FCC 10-180, the Commission is seeking comment on the scope of entities that should be covered by the proposals contained therein.

Wireless Telecommunications Carriers (except Satellite). Since 2007, the Census Bureau has placed wireless firms within this new, broad, economic census category. Prior to that time, such firms were within the now-superseded categories of “Paging” and “Cellular and Other Wireless Telecommunications.” Under the present and prior categories, the SBA has deemed a wireless business to be small if it has 1,500 or fewer employees. Because Census Bureau data are not yet available for the new category, the Commission will estimate small business prevalence using the prior categories and associated data. For the category of Paging, data for 2002 show that there were 807 firms that operated for the entire year. Of this total, 804 firms had employment of 999 or fewer employees, and three firms had employment of 1,000 employees or more. For the category of Cellular and Other Wireless Telecommunications, data for 2002 show that there were 1,397 firms that operated for the entire year. Of this total, 1,378 firms had employment of 999 or fewer employees, and 19 firms had employment of 1,000 employees or more. Thus, the Commission estimates that the majority of wireless firms are small.

Wireless Telephony. Wireless telephony includes cellular, personal communications services, and specialized mobile radio telephony carriers. As noted, the SBA has developed a small business size standard for Wireless Telecommunications Carriers (except Satellite). Under the SBA small business size standard, a business is small if it has 1,500 or fewer employees. According to FCC data, 434 carriers report that they are engaged in wireless telephony. Of these, an estimated 222 have 1,500 or fewer employees, and 212 have more than 1,500 employees. Therefore, the Commission estimates that 222 of these entities can be considered small.

Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements

In document FCC 10-180, the Commission proposes requirements that would require mobile service providers to offer notification alerts to consumers regarding their usage balances. Specifically, the Commission proposes that mobile service providers offer notification alerts to consumers when: (1) Subscribers are approaching their plan's allotted limit for voice, text, and data usage; (2) subscribers have reached their monthly allotment limit and begin incurring overage charges for any subsequent use of that service and (3) subscribers will incur international or roaming charges not covered under their monthly plans. In addition, the Commission proposes that mobile service providers shall make ongoing disclosure of any tools or services they offer which allow subscribers to set usage limits or monitor usage balances including any applicable charges for those services. Many mobile service providers already offer some of these services. However, mobile service providers may have to review and adjust their current alert systems to ensure compliance with these requirements. In addition, the Commission's proposed rules may require mobile providers to include information regarding how to request and use any usage controls and monitoring tools that they currently offer in the service providers' bills or in annual bill inserts. This would necessitate providing additional information to consumers via the monthly bill or an annual bill insert.

Steps Taken To Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered

The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

In document FCC 10-180, the Commission seeks comment on the costs for small providers to implement usage alerts including whether there is a need for varying implementation schedules between the larger and smaller providers to alleviate the burden for smaller providers. In addition, the Commission seeks comment on whether the Commission should consider exempting the smaller providers from any usage alert or roaming notification requirement due to the costs such a requirement might impose on them. In reviewing the frequency of mandatory usage alerts, the Commission seeks comment on the utility of providing multiple usage alerts to the consumer against the potential burdens to the wireless providers particularly smaller providers—who must supply them. Finally, the Commission seeks comment on the best methods to minimize costs for smaller, regional and/or rural mobile providers while ensuring their customers have access to information relating to any methods to monitor or set limits on usage offered by their service provider.

Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rules

None.

Ordering Clauses

Pursuant to the authority contained in sections 1-2, 4, 201, 258, 301, 303, 332 and 403 of the Communications Act of 1934, as amended, 47 U.S.C. 151-152, 154, 201, 258, 301, 303, 332 and 403, document FCC 10-180 is adopted.

The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of document FCC 10-180, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 64

• Reporting and recordkeeping requirements
• Telecommunications
• Telephone

Federal Communications Commission.

Marlene H. Dortch,

Secretary.

Proposed Rules

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 64 as follows:

PART 64—MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

Authority: 47 U.S.C. 154, 254(k); secs. 403(b)(2)(B), (c), Pub. L. 104-104, 110 Stat. 56. Interpret or apply 47 U.S.C. 201, 218, 222, 225, 226, 228 and 254(k) unless otherwise noted.

1. § 64.2402 is added to subpart Y to read as follows:

§ 64.2402

Usage alerts and information for mobile services.

(a) This section shall apply to providers of mobile services as defined in paragraph (b) of this section. The purpose of this section is to require mobile service providers to provide consumers with timely, baseline information relating to their monthly usage so that consumers can avoid unexpected overage charges.

(b) [Reserved].

(c) Usage notifications. Mobile service providers shall provide notification alerts when:

(1) Subscribers are approaching an allotted limit for voice, text, and data usage.

(2) Subscribers have reached their monthly allotment limit and begin incurring overage charges for any subsequent use of that service.

(3) Subscribers will incur international or roaming charges that are not covered by their monthly plans, and notification if they will be charged at higher than normal rates.

(d) Mobile service providers shall make clear, conspicuous, and ongoing disclosure of any tools or services they offer which allow subscribers to set usage limits or monitor usage balances, including any applicable charges for those services. This information should be made available in a manner that is accessible to and usable by consumers with disabilities, in accordance with section 716 of the Communications Act of 1934, as amended (Act), and the Commission's rules implementing sections 255 and 716 of the Act.