On December 30, 2016, the FCC’s Enforcement Bureau released a Notice of Apparent Liability for Forfeiture against a tower owner for failing to light and repaint its antenna structures as often as necessary to maintain good visibility, and for failing to notify the Federal Aviation Administration (“FAA”) of a lighting outage.  The proposed fine was set at $25,000.

            Background.  Under the FCC’s antenna structure rules, any proposed or existing antenna structure that requires notice of proposed construction to the FAA must be registered with the FCC.  In general, this obligation applies to towers exceeding 200 feet in height.  Some shorter towers may also require registration due to the tower’s location (e.g., proximity to an airport runway).

Registering a tower with the FCC is a two-step process.  Antenna structure owners must first file a form with the FAA, and receive a determination from that agency that the structure will not pose a hazard to air navigation (the FAA will also provide marking and lighting requirements).  Next, the antenna structure owner must submit to the FCC the FAA’s “no hazard” determination and FCC Form 854. 

If the application is accepted, the FCC will incorporate the FAA’s “no hazard” determination, along with any FAA marking or lighting specifications, and will assign the structure a registration number.  Once an antenna structure is registered, owners must comply with various requirements, including monitoring and periodically inspecting tower lighting systems, reporting lighting outages to the FAA immediately, and repairing outages “as soon as practicable.”

Notice of Apparent Liability.  On October 14, 2015, in response to an anonymous complaint, agents from the Enforcement Bureau’s Philadelphia Office inspected the antenna structures.  According to FCC rules and the FCC’s database, the owner’s structures were required to be painted and lit.  However, agents observed that the paint was faded and chipped, significantly reducing the structures’ visibility.  On January 5, 2016, an agent returned to the site and found that two antenna structures had lighting issues as well.

On February 9, 2016, the Philadelphia Office issued a Notice of Violation (“NOV”), noting that the tower owner had violated FCC rules by failing to clean and repaint the antenna structures as required to maintain good visibility, by failing to maintain the required lighting, and by failing to notify the FAA due to the lighting outages.  Though the tower owner responded twice to the NOV in March 2016, agents returned on August 31, 2016 and observed that the antenna structures had not been repainted and that the lighting issues on two of the structures persisted.

Accordingly, the Enforcement Bureau found the tower owner to have apparently willfully and repeatedly violated the FCC’s rules.  Though the base forfeiture amount under FCC rules for failing to comply with prescribed lighting and marking is $10,000, the Enforcement Bureau found an upward adjustment warranted because the tower owner did not correct the apparent violations despite repeated warnings.  With the release of the NAL, the tower owner has 30 days to pay the proposed fine or file a written statement seeking to reduce or cancel the proposed fine.

Cable operators with registered towers should make sure their towers are painted and lighted in accordance with their FCC registrations.  If you have any questions about the FCC’s antenna structure rules, please contact Scott Friedman at (312) 372-3930 or sfriedman@cinnamonmueller.com.

Enhanced Transparency Rules Go Into Effect January 17, 2017

Small Business Temporary Exemption Allowed to Expire December 15, 2016 

On December 16, 2016, the FCC announced that the enhanced transparency requirements will go into effect for providers of broadband Internet access service (“BIAS”) on January 17, 2017. 

As we have previously reported, the FCC adopted certain enhancements to the Open Internet Transparency Rule in its 2015 Open Internet Order (“2015 Order”).   The enhancements to BIAS providers’ existing disclosure requirements include, among other things, disclosure of any user or application-specific network management practices that are likely to affect the end user’s service, the addition of information concerning packet loss as a performance metric, and more granular information concerning commercial terms, including promotional rates and full monthly prices after promotional rates expire, data caps and allowances.

Despite the upcoming compliance deadline, Republican Commissioners Pai and O'Rielly, who will be part of the FCC majority beginning January 20, issued a letter to ACA and other trade associations to assure them that they would not support any adverse actions against small business providers for alleged non-compliance with the "enhanced transparency" rules.  The Commissioners’ letter also stated that they will seek to revisit those requirements as soon as possible.

Background.  In its 2010 Open Internet Order, the FCC adopted a rule requiring disclosures by BIAS providers – a service provided on a "mass market," non-individually negotiated basis (e.g., residential).  Specifically, the FCC defined “mass market” to mean a service marketed and sold on a standardized basis to residential customers, small businesses, and other end-user customers such as schools and libraries.  The term does not include enterprise service offerings, typically offered to larger organizations through customized or individually negotiated arrangements.  The Transparency Rule has been in effect since 2011, and requires public disclosure of accurate information regarding the network management practices, network performance and commercial terms of BIAS sufficient to allow consumers to make informed choices and Internet edge (content, applications, services, device) providers to develop, market and maintain Internet offerings.

In its 2015 Order, the FCC adopted certain enhancements to the Transparency Rule that imposed additional recordkeeping obligations on BIAS providers that required Office of Management and Budget (“OMB”) approval before they could go into effect.  As mentioned above, the FCC issued a Public Notice on December 16, 2016 announcing OMB approval and an effective date for the enhancements of January 17, 2017. 

When the enhanced transparency requirements were initially adopted, the FCC granted a temporary exemption from the enhancements for BIAS providers with 100,000 or fewer broadband connections.  Because the FCC did not extend the temporary exemption, all BIAS providers currently are required to comply with the enhanced transparency rules beginning January 17, 2017. 

Obligations.  The transparency enhancements include several significant new disclosure requirements regarding the content of each of three disclosure categories – network management, performance, and commercial terms, as well as enhancements to the means of disclosure.  

The FCC Chief Technologist, Office of General Counsel, and Enforcement Bureaus have issued advisory guidance on acceptable means of compliance with several of the new disclosure requirements.  This guidance describes acceptable methodologies for disclosure of expected and actual network performance metrics, further guidance on point of sale disclosures, and concludes that separate disclosures should be made for each service package or tier offered. 

The following outlines the enhanced transparency obligations as clarified in relevant part by the 2016 Guidance:

            Commercial Terms.  Existing disclosures concerning price must include the following enhancements concerning prices, fees and related terms:

• Price – Full monthly service charge.  Promotional rates to be clearly noted as such, with duration disclosed as well as full monthly service charge after expiration of promotional period.
• Other Fees – All additional one-time and/or recurring fees and/or surcharges with respect to service initiation, maintenance or discontinuance, including name and definition of each additional fee (e.g, early termination, modem rental, installation fees, etc.)
• Data Caps and Allowances – Any data caps or allowances that are part of the plan a consumer is purchasing, as well as consequences for exceeding the cap or allowance (e.g, additional chargers, loss of service for remainder of billing cycle, etc.)

            Performance Characteristics.  Existing disclosures concerning expected and actual performance of network performance of each broadband service offered must include the following enhancements:

• Actual network performance measures to be disclosed (now packet loss in addition to speed and latency).
• Actual performance data disclosed to consumers must be reasonably related to the performance a customer would experience in the geographic area where service is purchased.  No corresponding requirement for expected network performance metrics disclosures for different geographic areas was imposed.
• Measurement methodologies used must be disclosed and, to be deemed acceptable, must be grounded in commonly accepted principles of scientific research, good engineering principles and transparency.  
• Network performance is to be measured in terms of average performance over a reasonable period of time and during times of peak usage.
  • According to the 2016 Guidance, fixed BIAS providers may meet the requirement to disclose actual speed, latency and packet loss “reasonably related to the performance the consumer would likely experience in the geographic area in which the consumer is purchasing service” by disclosing actual performance metrics for each “operational area” – each geographic area where the service has a distinctive set of network performance metrics. 
  • Providers that comply with the requirement to disclose actual speeds – both download and upload – by disclosing either the median speed or range of actual speeds that includes the median speed (e.g., 25^th to 75^th percentile).  The same is true for disclosure of actual latency.  If speed or latency ranges are used, the percentiles used to determine the endpoints of the ranges must also be disclosed.  Packet loss may be disclosed as actual packet loss.
  • Fixed BIAS providers not participating in the Measuring Broadband America (“MBA”) Program may disclose actual network performance metrics by making their own measurements based on the MBA methodology; “internal testing; consumer speed test data; or other data regarding network performance, including reliable, relevant data from third-party sources.” 
• Disclosure of network performance is to be measured in terms of average performance over reasonable period of time and during times of peak usage.
  • According to the 2016 Guidance, peak usage periods may be based solely on the local time zone, and BIAS providers retain flexibility to determine the appropriate peak usage periods for their network performance metrics.
• BIAS providers must furnish a separate disclosure for each technology and each service tier offered to customers. 
• Disclosure of the impact of “Non-BIAS Data Services” (formerly known as “specialized” services) on the provision of BIAS must also include a description of whether the service relies on particular network practices and whether similar functionality is available to applications and services offered over BIAS.

Network Practices.  Network practices, including specific disclosures related to congestion management, application-specific behavior, device attachment rules and security must be disclosed.  Disclosures concerning network practices now must also include practices that are applied to the traffic associated with a particular user or user group, including any application-agnostic degradation of service to a particular end user.  These disclosures now must also include the purpose of the practice, which user or data plans are affected, the triggers used to active the use of the practice, the types of traffic that are subject to the practice and the likely effect of the practice on end users’ experiences.

Means of Disclosure.  The disclosures must be prominently displayed on a publicly available website, and the relevant information must be disclosed at the point of sale.  Certain enhancements were made to the means of disclosure. 

• Although the existing point-of-sale requirement was not actually modified, language in a footnote to the 2015 Order suggested otherwise.  To address concerns raised by some providers, the 2016 Guidance clarifies that BIAS providers are not required to provide hard copies of the disclosures required under the Transparency Rule at the point of sale and instead may direct consumers to links to online disclosures so long as consumers actually receive the information necessary to make informed decisions prior to making a final purchasing decision at all potential points of sale, including in a store, over the phone, and online.
• In addition to display of the disclosures on the provider’s website, providers are now required to have a mechanism in place for directly notifying end users if their individual use of a network will trigger a network management practice, based on their demand prior to a period of congestion, that is likely to have a significant impact on the end user’s use of the service.

Consumer Disclosure Format Safe Harbor.  The FCC has issued a Consumer Broadband Label to serve as a voluntary safe harbor in a “nutrition label” format of enhanced disclosures to end users.  BIAS providers using this label must also maintain a separate set of disclosures to meet their disclosure obligations to edge providers.

If you have any questions about the FCC’s Open Internet rules, the basic Transparency Rule and/or the enhanced transparency rules, please contact Barbara Esbin at (202) 872-6811 or besbin@cinnamonmueller.com, Bruce Beard at (314) 394-1535 or bbeard@cinnamonmueller.com, or Scott Friedman at (312) 372-3930 or sfriedman@cinnamonmueller.com.