[Federal Register Volume 89, Number 77 (Friday, April 19, 2024)]
[Rules and Regulations]
[Pages 28660-28679]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-07404]
[[Page 28660]]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 76
[MB Docket No. 23-203; FCC 24-29; FR ID 211518]
All-In Pricing for Cable and Satellite Television Service
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) implements the ``all-in'' rule, requiring cable operators
and direct broadcast satellite (DBS) providers to state an aggregate
price for the video programming that they provide as a clear, easy-to-
understand, and accurate single line item on subscribers' bills,
including on bills for legacy or grandfathered video programming
service plans. The ``all-in'' rule also requires cable operators and
DBS providers that communicate a price for video programming in
promotional materials to state the aggregate price for the video
programming in a clear, easy-to-understand, and accurate manner.
DATES:
Effective date: This rule is effective April 19, 2024.
Compliance date: Compliance with 47 CFR 76.310 is not required
until the Commission has published a document in the Federal Register
announcing the compliance date.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact Joseph Price, [email protected], of the Policy
Division, Media Bureau, (202) 418-1423.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order (Order), FCC 24-29, adopted on March 14, 2024, and released
on March 19, 2024. The full text of this document is available at
https://docs.fcc.gov/public/attachments/FCC-24-29A1.pdf and via ECFS at
https://www.fcc.gov/ecfs/. Documents will be available electronically
in ASCII, Microsoft Word, and/or Adobe Acrobat. Alternative formats are
available for people with disabilities (Braille, large print,
electronic files, audio format), by sending an email to [email protected]
or calling the Commission's Consumer and Governmental Affairs Bureau at
(202) 418-0530 (voice), 1-844-4-FCC-ASL (1-844-432-2275) (videophone).
Synopsis
1. In the Report and Order (Order), we take action to benefit video
consumers by requiring cable operators and direct broadcast satellite
(DBS) providers to specify the ``all-in'' price for video programming
in their promotional materials that include pricing information and on
subscribers' bills. Our action today enables consumers to make
purchasing decisions with access to clear, easy-to-understand, and
accurate information disclosing the price of video programming. We
believe that an ``all-in'' price for video service also will increase
transparency and have a positive effect on competition in the video
programming marketplace by allowing consumers to make better informed
choices among the ranges of video programming service options available
to them.
2. Sections 335 and 632 of the Communications Act of 1934, as
amended (the Act), authorize the Commission to adopt public interest
regulations for DBS providers and direct the Commission to adopt cable
operator customer service requirements, respectively.\1\ In 2019,
Congress adopted the Television Viewer Protection Act of 2019 (TVPA),
which bolstered the consumer protection provisions of the Act by adding
specific consumer protections.\2\ The TVPA revised the Act to add
section 642, which, among other things, requires greater transparency
in subscribers' bills.\3\ As Congress explained then, and we observe
today, consumers face ``unexpected and confusing fees when purchasing
video programming,'' including ``fees for broadcast TV [and] regional
sports.'' \4\
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\1\ 47 U.S.C. 335, 552.
\2\ Television Viewer Protection Act of 2019, Public Law 116-94,
133 Stat. 2534 (2019). The TVPA was enacted as Title X of the
``Further Consolidated Appropriations Act, 2020'' (H.R. 1865, 116th
Cong.) (2019-20).
\3\ 47 U.S.C. 562. Section 642 provides four main areas of
consumer protection related to billing: (1) before entering into a
contract with a consumer, a multichannel video programming
distributor (MVPD) must provide the consumer the total monthly
charge for MVPD service, whether offered individually or as part of
a bundled service, including any related administrative fees,
equipment fees, or other charges, (2) not later than 24 hours after
contracting with a consumer, an MVPD must provide the total monthly
charge that a consumer can expect to pay and permit the consumer to
cancel without fee or penalty for 24 hours, (3) with respect to
electronic bills, MVPDs must include an itemized statement that
breaks down the total amount charged for MVPD service and the amount
of all related taxes, administrative fees, equipment fees, or other
charges; the termination date of the contract for service between
the consumer and the provider; and the termination date of any
applicable promotional discount, and (4) MVPDs and fixed broadband
internet service providers must not charge a consumer for using
their own equipment and also must not charge lease or rental fees to
subscribers to whom they do not provide equipment. Id.
\4\ H.R. Rep 116-329, at 6 (2019).
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3. On June 20, 2023, the Commission released a notice of proposed
rulemaking (NPRM) (88 FR 42277, June 20, 2023), observing that
consumers who choose a video service based on an advertised monthly
price may be surprised by unexpected fees that cable operators and DBS
providers charge and list in the fine print separately from the top-
line listed service price. The Commission found that such fees can be
potentially misleading and make it difficult for consumers to compare
the prices of competing video service providers.\5\ In the NPRM, the
Commission proposed to enhance pricing transparency by requiring cable
operators and DBS providers to provide the ``all-in'' price for video
programming in their promotional materials and on subscribers'
bills.\6\ The Commission sought comment on whether the proposal is
sufficient to ensure that subscribers and potential subscribers have
accurate information about the cost for video service for which they
will be billed. Specifically, the Commission sought comment on (i) the
specifics of the proposed requirement for increased marketing and
billing transparency, (ii) existing Federal, state, and local
requirements related to truth-in-billing, (iii) the marketplace
practices regarding advertising and billing, and (iv) the Commission's
legal authority to adopt this proposal.\7\ The Commission also included
a request for comment on the costs and benefits of the proposal, as
well as the effects that the proposal could have on equity and
inclusion.\8\ The Commission received comments and ex parte filings
from individuals, consumer advocates, cable, DBS, broadcast industry
members, trade associations, state and local governments, and
franchising authorities.\9\ A number of comments
[[Page 28661]]
describe general consumer frustration with unexpected ``fees'' (for
example, for broadcast television programming and regional sports
programming \10\ charges listed separately from the monthly
subscription rate for video programming) that are actually charges for
the video programming for which the subscriber pays.\11\
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\5\ All-In Pricing for Cable and Satellite Television Service,
MB Docket No. 23-203, FCC 23-52, Notice of Proposed Rulemaking, 2023
WL 4105426 at *1, para. 2 (rel. June 20, 2023) (NPRM).
\6\ Id. at *2, para. 5.
\7\ Id.
\8\ Id.
\9\ See Letter from Mary Beth Murphy, Vice President/Deputy
General Counsel, NCTA--The Internet & Television Ass'n, to Marlene
H. Dortch, Esq., Secretary, FCC (filed Oct. 2, 2023) (NCTA Oct. 2 Ex
Parte); Letter from Leora Hochstein, Vice President, Government
Public Policy and Government Affairs, Verizon, to Marlene H. Dortch,
Esq., Secretary, FCC (filed Nov. 13, 2023) (Verizon Nov. 13 Ex
Parte); Letter from Michael Nilsson Counsel to DIRECTV, to Marlene
H. Dortch, Esq., Secretary, FCC (filed Jan. 31, 2024) (DIRECTV Ex
Parte); Letter from Mary Beth Murphy, Vice President and Deputy
General Counsel, NCTA--The Internet & Television Ass'n, to Marlene
H. Dortch, Secretary, FCC, MB Docket No. 23-203 (filed Feb. 14,
2023) (NCTA Feb. 14 Ex Parte); Letter from Charles Dudley, Florida
Internet & Television Ass'n; Andy Blunt, MCTA--The Missouri Internet
& Television Ass'n; David Koren, Ohio Cable Telecommunications
Ass'n; and Walt Baum, Texas Cable Ass'n, to Marlene H. Dortch, Esq.,
Secretary, FCC (filed Mar. 5, 2024) (State Cable Ass'ns Mar. 5 Ex
Parte); Letter from Leora Hochstein, Vice President, Government
Public Policy and Government Affairs, Verizon, to Marlene H. Dortch,
Esq., Secretary, FCC (filed Mar. 6, 2024) (Verizon Mar. 6 Ex Parte);
Letter from Mary Beth Murphy, Vice President/Deputy General Counsel,
NCTA--The Internet & Television Ass'n, to Marlene H. Dortch, Esq.,
Secretary, FCC (filed Mar. 6, 2023) (NCTA Mar. 6 Ex Parte); Letter
from Stacy Fuller, SVP, External Affairs, DIRECTV, to Marlene H.
Dortch, Esq., Secretary, FCC (filed Mar. 7, 2024) (DIRECTV Mar. 7 Ex
Parte); Letter from Brian Hurley, ACA Connects, to Marlene H.
Dortch, Esq., Secretary, FCC (filed Mar. 7, 2024) (ACA Connects Mar.
7 Ex Parte); Letter from Keith J. Leitch, President, One Ministries,
Inc. (KQSL), to Marlene H. Dortch, Esq., Secretary, FCC (filed Mar.
7, 2024); Letter from Leora Hochstein, Vice President, Government
Public Policy and Government Affairs, Verizon, to Marlene H. Dortch,
Esq., Secretary, FCC (filed Mar. 8, 2024) (Verizon Mar. 8 Ex Parte);
Letter from Michael Nilsson, Counsel to ACA Connects, to Marlene H.
Dortch, Secretary, FCC (filed Mar. 8, 2024) (ACA Connects Mar. 8 Ex
Parte).
\10\ See generally Review of the Commission's Program Access
Rules and Examination of Programming Tying Arrangements, First
Report and Order, 25 FCC Rcd 746, Appx. A at 121 (2010) (defining
``Regional Sports Network''); Altitude Sports & Entm't, LLC v.
Comcast Corp., No. 19-cv-3253-WJM-MEH, 2020 WL 8255520 at *1 (D.
Colo. Nov. 25, 2020) (defining the ``relevant product market'' for
regional sports programming).
\11\ See, e.g., Comments of Truth in Advertising, Inc. (Truth in
Advertising Comments); Daniel Drake Comments at 1; Jonathan Bates
Comments at 1; Maureen Comments at 1; M Mondesir Comments at 1;
Kenneth Lubar Comments at 1; Mitchel Bakke Comments at 1; Matt Mann
Comments at 1.
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Discussion
4. In the Order, we adopt the proposal in the NPRM to require that
cable operators and DBS providers provide the ``all-in'' price of video
programming as a prominent single line item on subscribers' bills and
in promotional materials that state a price.\12\ We find that the
record demonstrates that charges and fees for video programming
provided by cable and DBS providers are often obscured in misleading
promotional materials and bills, which causes significant and costly
confusion for consumers. We, therefore, adopt the ``all-in'' rule to
promote pricing transparency and to complement existing consumer
protections and practices of cable operators and DBS providers.
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\12\ NPRM, 2023 WL 4105426 at *2, para. 6.
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5. First, we describe current marketplace practices and conclude
that the ``all-in'' rule is well-tailored to address the need for
consumers to have accurate information about the cost of video service.
Next, we consider issues related to implementation of the ``all-in''
rule, including how the rule applies to bundled services and billing
material (including for currently-offered and grandfathered or legacy
plans) and promotional material (including national and regional
marketing where charges to consumers vary by geography and promotional
discounts). We discuss the legal authority we rely upon to implement
the ``all-in'' rule. We conclude that section 642 of the Act (the
TVPA), section 632 of the Act (covering cable operators), section 335
of the Act (covering DBS providers), as well as ancillary authority,
provide ample authority for the ``all-in'' rule. We also conclude that
the ``all-in'' rule is consistent with the First Amendment. We consider
existing local, state, and voluntary consumer protections adopted and
implemented by cable operators and DBS providers, as well as existing
Federal requirements stemming from the TVPA applicable to multichannel
video programming distributors (MVPDs), that relate to transparency and
disclosure of pricing information. We conclude that the ``all-in'' rule
will complement existing protections by further mitigating consumer
confusion about the aggregate cost of video programming. Finally, we
consider the potential competitive effects of the ``all-in'' rule and
conclude that increased consumer access to clear, easy-to-understand,
and accurate information likely encourages price competition,
innovation, and the provision of high-quality services.
6. Need for the ``All-In'' Rule. Based on the record, we find that
there is a need for the ``all-in'' rule so that consumers can make
better informed decisions about their service and can comparison shop
among video programming providers without having to ``read fine print
or try to determine which `fees' or `surcharges' are really charges
related to video programming services that might raise the monthly cost
compared to other offers they are considering.'' \13\ In the NPRM, the
Commission sought comment on whether consumers encounter misleading
promotions or receive misleading bills, and on current industry
practices regarding pricing categorization.\14\ As described below,
individuals, consumer protection organizations, state and local
governments, and franchise authorities report that consumers experience
``considerable'' confusion and surprise when unanticipated charges and
fees for cable and satellite video programming are not included in the
advertised price in promotional materials and are separately listed on
bills.\15\
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\13\ Comments of the City of Oklahoma City, Oklahoma; City of
Minneapolis, Minnesota; Metropolitan Area Communications Commission;
Northwest Suburbs Cable Communications Commission; North Metro
Telecommunications Commission; South Washington County
Telecommunications Commission; North Suburban Communications
Commission; City of Edmond, Oklahoma; City of Coon Rapids,
Minnesota; and City of Aumsville, Oregon, at 6 (Local Franchise
Authorities Comments). See also Comments of the Texas Coalition of
Cities For Utility Issues, City of Boston, Massachusetts, the Mt.
Hood Cable Regulatory Commission, Fairfax County, Virginia and
National Association of Telecommunications Officers and Advisors
(NATOA), at 10 (Local Government Comments) (stating their belief
``that a robust disclosure requirement that works alongside local
consumer protection regulation will be a welcome addition to the
cable sector and improve prices and competition for consumers'').
\14\ NPRM, 2023 WL 4105426 at *2-4, paras. 7-10.
\15\ See, e.g., Reply Comments of the City of Oklahoma City,
Oklahoma; City of Minneapolis, Minnesota; Metropolitan Area
Communications Commission; Northwest Suburbs Cable Communications
Commission; North Metro Telecommunications Commission; South
Washington County Telecommunications Commission; North Suburban
Communications Commission; City of Edmond, Oklahoma; City of Coon
Rapids, Minnesota; City of Aumsville, Oregon; and City of Mustang,
Oklahoma (the Local Franchise Authorities), at 3 (Local Franchise
Authorities Reply Comments) (concluding the all-in rule is needed to
resolve the ``[c]onsiderable confusion among consumers regarding
`junk fees' '' on subscribers' bills); Reply Comments of the
Colorado Communications and Utility Alliance at 2 (asserting that
``cable operators and DBS television providers have been using fees
associated with `broadcast television' and `regional sports' to
obfuscate the true price of cable television service''); Comments of
Kenneth Lubar (stating that ``[t]he advertised fees [of cable
companies] are misleading and hinder effective comparison of true
costs''); Consumer Reports (with Public Knowledge) Comments at 5
(Consumer Reports and Public Knowledge Comments) (observing that
hidden fees ``enable cable companies to camouflage price increases,
confounding consumer efforts to comparison shop and to maintain
household budgets''); Comments of the National Association of
Broadcasters at 5 (NAB Comments) (``Current advertising and billing
methods used by MVPDs can lead consumers to believe that
retransmission consent fee payments are somehow different from all
the other inputs into MVPDs' programming packages or that
retransmission consent payments to broadcasters constitute a tax or
governmental regulatory fee.'').
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7. Consumer protection groups describe significant, recurring
issues with consumer access to clear, easy-to-understand, and accurate
information about the price of cable operator and DBS provider video
programming. Truth in Advertising, for example, contends that ``several
cable and satellite service companies [are] engaged in deceptive
pricing practices, including the use of unexpected fees.'' \16\ Truth
in
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Advertising discusses a 2019 analysis by Consumer Reports of 800 cable
bills, revealing the cable industry generates $450 per customer, per
year, from company-imposed fees, and that nearly 60% of Americans who
encounter these unexpected or hidden fees report the fees caused them
to exceed their budget.\17\ Consumer Reports examined hundreds of cable
and satellite television bills collected in 2018 and made several
findings in the 2019 report, ``including that consumers pay
significantly more than the advertised price for video programming . .
. because of the addition of various fees, surcharges, and taxes.''
\18\ According to Consumer Reports, fees are ``often imposed or
increased with little notice, and are often listed among a dizzying
array of other charges, including government-imposed fees and taxes''
while cable companies ``continue advertising relatively low base
rates.'' \19\ Further, a 2018 ``Secret Shopper Investigation''
conducted by Consumer Reports found that consumers were provided with
inaccurate or confusing fee-related information by customer service
representatives of cable and DBS providers on a number of
occasions.\20\ This included customer service representatives
portraying certain company-imposed fees as government-imposed taxes and
fees; failing to mention fees; or offering incomplete fee
information.\21\
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\16\ Truth in Advertising Comments at 2.
\17\ Id. at 4-5 (citing CR Cable Bill Report 2019).
\18\ Consumer Reports and Public Knowledge Comments at 2-3
(citing CR Cable Bill Report 2019). See also NPRM, 2023 WL 4105426
at *1, para. 4 (citing Consumer Reports and Public Knowledge Reply
Comments, MB Docket No. 21-501, at 2 (filed Mar. 7, 2022)).
\19\ Consumer Reports and Public Knowledge Comments at 5.
\20\ Id. at 14-15.
\21\ Id. at 15, 19 (concluding ``that providers seldom
acknowledge that company-imposed fees are in fact imposed at the
discretion of the cable companies, and, further, that they
frequently state or suggest the exact opposite: that the company has
no choice but to charge these fees'').
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8. Comments filed by individual consumers as well as state and
local governments and franchise authorities likewise detail concerns
about misleading promotional materials and bills for cable and DBS
service and urge the Commission to adopt an ``all-in'' rule to protect
consumers. The record indicates that approximately 24 to 33 percent of
a consumer's bill is attributable to company-imposed fees such as
``Broadcast TV Fees,'' ``Regional Sports Surcharges,'' ``HD Technology
Fees,'' and others,\22\ and that the ``dollar amount of company-imposed
fees has skyrocketed.'' \23\ However, consumers too often lack
transparent information about fees that significantly increase the cost
of advertised and billed video services and how they will affect their
total cost and bottom-line budget.\24\ Increases in fees relating to
video programming during the term of the service agreement are sources
of consumer surprise and confusion, and it is ``especially notable . .
. that these fees are being raised by cable companies even while many
consumers are locked into supposed `fixed-rate' contracts.'' \25\ As
the Local Government Commenters emphasize, these fees
disproportionately impact lower-income households.\26\
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\22\ See id. at 3-4, 10.
\23\ Id. at 6.
\24\ See Consumer Reports and Public Knowledge Comments at 6.
\25\ Id. at 5.
\26\ Local Government Comments at 6. See also infra section
III.G (Digital Equity and Inclusion).
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9. Misinformation and misunderstandings about how much subscribing
to video programming service costs lead to subscriber complaints,
disputed bills, and litigation. Consumer Reports observed that since
2016, state attorneys general in Massachusetts, Minnesota, and
Washington have ``launched investigations and/or filed lawsuits
accusing Comcast, one of the nation's largest cable operators, of fee-
related fraud.'' \27\ Truth in Advertising describes eight class-action
lawsuits initiated by consumers challenging unexpected charges and
fees.\28\ The Local Government Commenters report that ``[c]lass action
lawsuits or suits brought by state Attorneys General have resulted in
settlements when companies impose fees that exceed its promise of a
fixed price.'' \29\ Local franchising authorities from several states
also report a variety of complaints they are receiving, and the types
of questions they respond to, in support of ``subscribers who are
confused'' about the charges on bills from cable operators and DBS
providers.\30\
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\27\ Id. at 15-17 (citing Assurance of Discontinuance, In the
Matter of Comcast Cable Commc'ns LLC, No. 18-3514 (Mass. Super. Ct.
Nov. 9, 2018)).
\28\ These include class action lawsuits against Cox, Frontier,
AT&T, DIRECTV, CenturyLink, Comcast, DISH Network, and Charter
Communications. Truth in Advertising Comments at 2-3.
\29\ Local Government Comments at 5.
\30\ See Local Franchise Authorities Comments at 1-7.
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10. On the other hand, cable and DBS commenters dispute the
characterization of their advertising and billing practices as
misleading to consumers and argue that there is no need for the
Commission to adopt an ``all-in'' rule. NCTA--The Internet & Television
Association (NCTA) contends that ``[p]roviding accurate and transparent
pricing information to consumers is a marketplace necessity'' given
fierce competition for consumers in the video programming market.\31\
According to NCTA, ``[i]n the course of a prospective customer's
consideration of which service package to buy (the `buy-flow') and on
customers' bills, our members clearly disclose the specific amounts of
the fees that will apply and the total amount customers will pay for
service, thereby ensuring that customers are not `surprised by
unexpected fees.'' \32\ In addition, NCTA argues that there is no need
for the Commission to adopt an ``all-in'' requirement because the
existing transparency in billing requirements of the TVPA sufficiently
address this issue.\33\ DIRECTV submits that an ``all-in'' rule could
complicate ``apples-to-apples'' comparison shopping because it (i)
would require the disclosure of only one variable in a service
offering--price--rather than specific channels or other aspects of the
video programming service that the provider offers, thus ``creat[ing]
confusion in a world where the content and other terms of the service
offering differ dramatically among providers''; (ii) would apply only
to cable and DBS and not other providers of video programming,
including online video distributors; and (iii) would require a single
price in national advertising even though actual prices differ
depending on where a customer lives.\34\
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\31\ Comments of NCTA--The Internet & Television Association at
3 (NCTA Comments).
\32\ NCTA Comments at 2-3.
\33\ Id. at 4-7. See infra section III.D.2 (discussing the
TVPA).
\34\ Comments of DIRECTV at ii, 9-12 (DIRECTV Comments).
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11. Although industry commenters assert that the practice of
separating certain elements of the price for video programming and
listing them as ``fees'' does not deceive consumers,\35\ we believe
that the weight of evidence in the record as detailed above suggests
otherwise and that efforts to address these issues will benefit from a
robust ``all-in'' rule. As Local Government Commenters contend,
``[m]ore clarity and transparency are needed to help consumers
understand their cable bills and make informed decisions about their
services,'' and ``consumers should know what their video programming
services will cost, including all charges cable operators add to those
services.'' \36\ We agree that an ``all-in'' rule serves the dual
purposes of helping consumers
[[Page 28663]]
comparison shop among video programming providers when looking at
promotional materials and helping subscribers recognize when the price
for video service has changed when looking at their bills.\37\ As we
found in the NPRM, unexpected fees related to the cost of video
programming, and how those fees are disclosed, can ``make it difficult
for consumers to compare the prices of video programming providers.''
\38\ An ``all-in'' price that lets consumers know the exact amount that
they pay for video programming will give consumers a clear, easy-to-
understand, and accurate price-point to consider.\39\ We disagree that
requiring cable operators and DBS providers to present consumers with
honest pricing information without addressing other variables of video
programming service will complicate comparison shopping. The ``all-in''
rule does not prohibit additional information that may highlight or
compare a service feature (for example, the number, quality, or types
of video programming channels available). Instead, it simply prohibits
deceptive pricing practices. We also find, based on the record, that
the ``all-in'' rule will benefit consumers, notwithstanding its
application only to cable and DBS providers, considering the specific
issues raised in the record with respect to these services.
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\35\ See, e.g., NCTA Reply Comments at 2-3; NCTA Oct. 2 Ex Parte
at 1-2.
\36\ Local Franchise Authorities Comments at 5.
\37\ Id.
\38\ NPRM, 2023 WL 4105426 at *1, para. 2.
\39\ Thus, we disagree with industry commenters that suggest
that an ``all-in'' rule will lead to less transparency because it
addresses only one variable in a video service offering--price. See,
e.g., DIRECTV Comments at 9-12. Commenters point to the success of
the recently adopted broadband consumer label that also ``offers
helpful guidance for the Commission in adopting a consistent and
clear obligation for cable services and DBS'' and suggest the all-in
rule should include factors similar to those required in a broadband
consumer label. Local Government Comments at 10-11.
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12. The ``All-In'' Rule. We adopt the proposal in the NPRM to
require cable operators and DBS providers to provide the ``all-in''
price for video programming service in both their promotional materials
and on subscribers' bills.\40\ As noted in the NPRM and confirmed by
the record in this proceeding, the public interest requires that cable
operators and DBS providers represent their subscription charges
transparently, accurately, and clearly. While commenters representing
the cable and DBS industry object to the proposal, the record otherwise
reflects a broad swath of support for adoption of an ``all-in'' price
rule.
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\40\ NPRM, 2023 WL 4105426 at *2, para. 5.
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13. General Implementation. In accordance with this requirement,
cable operators and DBS providers must aggregate the cost of video
programming (that is, any and all amounts that the cable operator or
DBS provider charges the consumer for video programming, including for
broadcast retransmission consent, regional sports programming, and
other programming-related fees) as a prominent single line item in
promotional materials (if a price is included in those promotional
materials) and on subscribers' bills.\41\ We do not require every cable
or DBS advertisement to provide an ``all-in'' price where pricing is
not otherwise included in the ad; but when a price is included in
promotional materials, the ``all-in'' rule applies.\42\ This aggregate
price must include the full amount of the charge the cable operator or
DBS provider charges (or intends to charge) the customer in exchange
for video programming, including costs relating to broadcast television
retransmission, and sports and entertainment programming. We agree with
commenters that requiring cable and DBS providers to include these
video programming charges in the ``all-in'' price will help consumers
``better distinguish between operator-imposed charges and government-
imposed taxes or fees''; as the record indicates, by separating out
these charges, cable operators and DBS providers mislead consumers into
believing such charges are government-imposed fees when they are
nothing of the sort. Instead, such video programming charges are part
of the aggregate cost for video programming in their promotional and
billing material.\43\
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\41\ Id. at *2, para. 6.
\42\ For purposes of the ``all-in'' rule, promotional material
includes communications to consumers such as advertising and
marketing.
\43\ Local Franchise Authorities Comments at 7-8; Consumer
Reports and Public Knowledge Comments at 5, 15, 19; Local Government
Comments at 5; NCTA Reply Comments at 3.
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14. Consistent with the Commission's proposal in the NPRM,\44\
amounts beyond those charged to the consumer for the video programming
itself, such as taxes, administrative fees, equipment fees,\45\ and
franchise fees,\46\ or other such charges, are excluded from the ``all-
in'' rule.\47\ Commenters discussed the potential benefits and
downsides of extending the ``all-in'' rule to cover charges and fees
not directly related to the provisioning of video programing. Consumer
Reports and Public Knowledge, for example, support a broad application
of the ``all-in'' rule, including where ``fees might be variable,''
such as equipment costs, because, if not, the advertised price ``is not
the real price a consumer will eventually pay.'' \48\ The Local
Franchise Authorities, on the other hand, suggest ``the Commission
should be clear that an all-in price that includes government-imposed
taxes or fees does not satisfy the rule.'' \49\ We are convinced, at
this time, to focus the ``all-in'' rule on the issues identified in the
record regarding the disclosure of charges associated with the video
programming itself. We also are mindful of pragmatic difficulties of
complying with the ``all-in'' rule when certain costs for each consumer
(not for each market) vary more than others.\50\ Compliance with the
``all-in'' rule could be complicated, for example, by taxes that may
vary by location; and decisions on whether there is a need to purchase
equipment and on the number and type of devices, which vary for each
household.
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\44\ NPRM, 2023 WL 4105426 at *2, para. 6 (stating that the
Commission ``intend[s] for this aggregate amount to include the full
amount the cable operator or satellite provider charges (or intends
to charge) the customer in exchange for video programming service
(such as broadcast television, sports programming, and entertainment
programming), but nothing more (that is, no taxes or charges
unrelated to video programming).''
\45\ See id. at *2, para. 6 n.10 (declining to propose ``to
require that cable operators and DBS providers include equipment
costs in the `all-in' price listed on promotional materials and
bills, as these costs are variable for each subscriber, and some
subscribers use their own equipment and therefore do not incur such
charges from the provider'').
\46\ For purposes of this proceeding, we will consider Public,
Educational, and Governmental Access Support Fees (PEG Fees) as part
of franchise fees, consistent with prior Commission findings.
Implementation of Section 621(A)(1) of the Cable Communications
Policy Act of 1984 as Amended by the Cable Television Consumer
Protection and Competition Act of 1992, MB Docket No. 05-311, 34 FCC
Rcd 6844, 6860-62, paras. 28-30 (2019) (84 FR 44725, Aug. 27, 2019)
(finding that the definition of franchise fee in section 622(g)(1)
encompasses PEG-related contributions).
\47\ Id. at *7, para. 16 (concluding, tentatively, that ``the
terms `taxes,' `administrative fees,' `equipment fees,' or `other
charges' cannot reasonably include separate charges for various
types of video programming (e.g., amounts paid for retransmission
consent rights or rights to transmit regional sports programming or
any other programming)'' (citing 47 U.S.C. 542(c)).
\48\ Consumer Reports and Public Knowledge Comments at 10-11
(arguing ``the fact that [equipment] fees might be variable is not a
reason to exclude them in the aggregate price'').
\49\ Local Franchise Authorities Comments at 8 (``[T]o ensure
full transparency, the Commission should be clear that an all-in
price that includes government-imposed taxes or fees does not
satisfy the rule. Including government-imposed taxes and fees in the
all-in price will continue to obscure cable operators' decisions
regarding pricing and additional charges.'' (citing NPRM, 2023 WL
4105426 at *2, para. 7)).
\50\ Consumer Reports and Public Knowledge Comments at 11
(arguing that ``even if minor variations were present, tailoring an
advertised price to reflect different prices does not strike us as
overly burdensome'').
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15. As proposed in the NPRM, we are persuaded that service
providers subject to the ``all-in'' requirement may provide
[[Page 28664]]
their subscribers and potential subscribers with itemized information
about how much of their subscription payments are attributable to
specific costs relating to providing video programming or other items
that contribute to the bill.\51\ Thus, consistent with sections 622(c)
and 642 of the Act,\52\ cable operators and DBS providers may
complement the prominent aggregate cost line item with an itemized
explanation of the elements that compose that aggregate cost.\53\
Information in addition to the ``all-in'' price may be included, so
long as the cable operator or DBS provider portrays the video
programming-related costs as part of the ``all-in'' price for
service.\54\ Additional communications (the customer subscription and
billing processes, for example) may also include information about
other attributable costs with even more granularity, but may not be a
substitute for, or obscure, compliance with the ``all-in'' price. The
``all-in'' rule, for example, does not prevent the additional
disclosure of costs relating to retransmission consent fees incurred by
cable operators and DBS providers. The record describes issues cable
operators and DBS providers incur by recouping retransmission costs,
which some providers would like to avoid entirely or inform their
customers of, and there is a lack of evidence indicating that
additional disclosures that the industry supports causes consumer
confusion.\55\ Our decision does not prohibit additional disclosures or
separate line items, including those required by section 642 of the Act
or permitted under 622(c) of the Act.\56\ We also decline at this time
to ``reform the retransmission consent marketplace,'' as some
commenters have requested, as it is beyond the scope of this proceeding
and the focus of the Commission in other dockets.\57\
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\51\ See NPRM, 2023 WL 4105426 at *3, para. 8; 47 U.S.C. 562;
NTCA--The Rural Broadband Association Comments at 5. We note that in
some instances this itemization may be required, as well as
compliance with the ``all-in'' rule. See 47 U.S.C. 562(b)(1)
(requiring bill in electronic formats to include ``an itemized
statement that breaks down the total amount charged for or relating
to the provision of the [MVPD] service by the amount charged for the
provision of the service itself and the amount of all related taxes,
administrative fees, equipment fees, or other charges'').
\52\ 47 U.S.C. 542(c) (permitting cable operators to identify
franchisee fees, public, educational, and governmental access (PEG)
fees, and other fees, taxes, assessments, or other charges imposed
by the government ``as a separate line item on each regular bill of
each subscriber''); 47 U.S.C. 562(b)(1) (requiring MVPD consumer
bills to include an ``itemized statement that breaks down the total
amount charged for or relating to the provision of the covered
service by the amount charged for the provision of the service
itself and the amount of all related taxes, administrative fees,
equipment fees, or other charges'').
\53\ ACA Connects Comments at 9, 15.
\54\ See id. at 6-7 (describing how some ACA Connects members
``explicitly pass through retransmission consent fees and [regional
sports] fees as line items on subscriber bills'' to promote
transparency and ``help customers understand the source of . . .
increases'').
\55\ See, e.g., id. at 6-7 (``To be clear, our Members would
prefer to help their video customers by reducing prices or at least
curbing price increases, but the dictates of the retransmission
consent regime make this impossible. The best they can do is
transparency: by explicitly identifying the programming fees that
are driving up cable bills, they can at least help customers
understand the source of these increases.'').
\56\ See NPRM, 2023 WL 4105426 at *3, para. 8 (discussing that
cable operators may identify certain charges imposed by the
government ``as a separate line item on each regular bill of each
subscriber,'' 47 U.S.C. 542(c), and the MVPD electronic format
billing requirement to include an itemized statement that breaks
down the total amount charged, 47 U.S.C. 562(b)(1)).
\57\ See ACA Connects Comments at 9, 15 (urging the Commission
to ``to refocus its efforts on finding ways to reform the
retransmission consent marketplace for the benefit of consumers'').
The Commission has and is addressing issues regarding retransmission
consent in other dockets, and we continue to believe those issues
should be addressed separate from the ``all-in'' rule. See, e.g.,
Amendment of the Commission's Rules Related to Retransmission
Consent, MB Docket No. 10-71, Report and Order (79 FR 28615, May 19,
2014) and Further Notice of Proposed Rulemaking (79 FR 19849, April
10, 2014), 29 FCC Rcd 3351 (2014) (seeking comment on the
Commission's retransmission consent rules); Reporting Requirements
for Commercial Television Broadcast Station Blackouts, Notice of
Proposed Rulemaking, MB Docket No. 23-437, FCC 23-115, 2023 WL
8889607 (Dec. 21, 2023) (89 FR 5184, Jan. 26, 2024) (proposing a
reporting framework that ``would require public notice to the
Commission of the beginning and resolution of any blackout and
submission of information about the number of subscribers
affected''); Customer Rebates for Undelivered Video Programming
During Blackouts, Notice of Proposed Rulemaking, MB Docket No. 24-
20, FCC 24-2, 2024 WL 212126 (Jan. 17, 2024) (89 FR 8385, Jan. 7,
2024) (seeking comment on whether to require cable operators and DBS
providers to rebate subscribers for programming blackouts that
result from failed retransmission consent negotiations or failed
non-broadcast carriage negotiations); Federal Communications
Commission, Retransmission Consent, https://www.fcc.gov/media/policy/retransmission-consent (last updated Sept. 27, 2021).
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16. In the NPRM, the Commission sought comment on whether the
``all-in'' proposal should differentiate between residential, small
business, and enterprise subscribers.\58\ We agree with commenters
asserting that the ``all-in'' rule should apply to all residential
customer services provided by cable and DBS operators, including
residents in multiple tenant or dwelling unit environments served by
such operators.\59\ However, we are also persuaded that services
provided and marketed to enterprise customers and bulk purchasers of
non-residential video programming service should be exempt from the
rule because, as NCTA explains, ``[s]uch customers subscribe to video
services under customized or individually negotiated plans and thus
receive all of the relevant information during the customization or
negotiation process.'' \60\
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\58\ See NPRM, 2023 WL 4105426 at *3, para. 9. Enterprise
customers include bulk purchasers (such as multiple dwelling unit
(MDU) or multiple tenant environment (MTE) owners) and typically do
not include small business or residential customers. See NCTA
Comments at 8.
\59\ See Local Government Reply Comments at 9 (``[R]esidents of
multi-dwelling units (MDUs) can often be the most vulnerable
consumers and should not be excluded from the proposed rule's
protections.'').
\60\ See NCTA Comments at 8 (``[E]nterprise customers and bulk
purchasers (such as multiple dwelling unit (MDU) or multiple tenant
environment (MTE) owners) should not be covered by the proposed
rule.''); DIRECTV Comments at 16-17 (suggesting the Commission not
regulate business services, as enterprise customers are
sophisticated entities that do not need the Commission's
protection).
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17. We decline to impose more specific requirements for how to
present an ``all-in'' price to consumers beyond our finding that it
must be a prominent single line item in promotional materials and on
subscribers' bills. In the NPRM, the Commission sought comment on
whether the term ``prominent'' is specific enough to ensure that cable
operators and DBS providers present consumers with easy-to-understand
``all-in'' subscription price, or whether we need to provide more
detail about how the price for service must be communicated.\61\ We do
not at this time impose a ``service nutrition-style label,'' specific
font size, or disclosure proximity requirement to comply with the
``all-in'' rule. Comments submitted on this point support a clear,
easy-to-understand, and accurate statement of the total cost of video
programming, while service providers suggest flexibility. We find that
the clear, easy-to-understand, and accurate communication of the
aggregate price of video service that the cable operator or DBS
provider charges best achieves our goal of promoting transparency in
promotional and billing material.
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\61\ See NPRM, 2023 WL 4105426 at *2, para. 7.
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18. Compliance Date. The ``all-in'' rule must be fully implemented
within nine months of release of the Report and Order or after the
Office of Management and Budget completes review of any information
collection requirements that may be required under the Paperwork
Reduction Act of 1995 (PRA),\62\ whichever is later, with the exception
of small cable operators which will have 12 months to come into
compliance. In
[[Page 28665]]
the NPRM, we sought comment on what would be a reasonable
implementation period for providers to update their systems to reflect
any changes if we were to adopt the ``all-in'' price.\63\ Verizon has
suggested the Commission ``allow at least six months for providers to
comply and ensure `a reasonable implementation period for providers to
update their system,' [and] an additional six months for parties to
comply with any rules that affect legacy plans.\64\ NCTA contends that
``given the scope of changes that could be necessary to implement an
all-in pricing rule, the Commission should grant at least 12 months for
operators to come into compliance.'' \65\ ACA Connects likewise argues
that the Commission should provide at least twelve months for providers
to implement any requirements, particularly for smaller cable operators
that use software platforms from third-party vendors.\66\ We conclude
that a nine-month implementation period will be sufficient to fully
implement the ``all-in'' rule, which will afford time to affect
operating systems and address legacy plan billing. We note that
Congress afforded MVPDs six months to implement the billing
requirements of the TVPA and conclude that nine months for most
providers is a time period that will similarly benefit consumers when
implementing the ``all-in'' rule.\67\ However, given the concerns
raised by ACA Connects, we give small cable operators, i.e., those with
annual receipts of $47 million or less, an additional three months to
come into compliance.\68\
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\62\ Public Law 104-13, 109 Stat. 163 (1995) (codified in
Chapter 35 of title 44 U.S.C.).
\63\ NPRM, 2023 WL 4105426 at *3, para. 9.
\64\ Verizon Nov. 13 Ex Parte at 2 (quoting NPRM, 2023 WL
4105426 at *3, para. 9).
\65\ NCTA Feb. 14 Ex Parte at 3. See also DIRECTV Mar. 7 Ex
Parte at 2 (suggesting that the Commission ``either extend[ ] the
overall deadline to twelve months or maintain[ ] the current nine-
month deadline for advertisements but allow[ ] an additional six
months for billing'').
\66\ As ACA explains, ``smaller operators are dependent on
third-party vendors that serve many customers, and smaller systems
often have to `wait in line' behind larger ones when implementing
any changes to their billing systems.'' ACA Connects Mar. 8 Ex Parte
at 2. This is similar to the delays that small operators face in
obtaining equipment that complies with our rules. See TiVo Inc.'s
Request for Clarification and Waiver of the Audiovisual Output
Requirement of Section 76.640(b)(4)(iii), etc., MB Docket No. 12-
230, etc., Memorandum Opinion and Order, 27 FCC Rcd 14875, 14884,
para. 17 (observing that ``small cable operators have, in the past,
experienced difficulty obtaining compliant devices in the same time
frame as larger operators'') (2012).
\67\ Television Viewer Protection Act of 2019, Public Law 116-
94, 133 Stat. 2534 (2019), sec. 1004(b) (``Section 642 of the [Act]
. . . shall apply beginning on the date that is 6 months after the
date of the enactment of this Act. The [Commission] may grant an
additional 6-month extension if [it] finds that good cause exists
for such . . . extension.''). The Commission granted a six-month
extension due to ``the national emergency concerning the COVID-19
pandemic.'' Implementation of Section 1004 of the Television Viewer
Protection Act of 2019, Order, 35 FCC Rcd 3008, 3009, para. 3 (MB
2020).
\68\ See 13 CFR 121.201, NAICS Code 516210 (classifying ``Media
Streaming Distribution Services, Social Networks, and Other Media
Networks and Content Providers'' with annual receipts of $47 million
or less as small). See also NPRM, 2023 WL 4105426 at para. 20
(seeking comment on whether there are ways to limit any potential
compliance burdens on providers, including ``on small cable
operators, as that term is defined by the Small Business
Administration'' and citing 13 CFR 121.201, NAICS Code 516210).
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19. Bundled Services. The ``all-in'' rule requires clear, easy-to-
understand, and accurate disclosure of the aggregate cost of video
programming when a cable operator or DBS provider promotes or bills for
video programming that is part of a bundle. Bundled services are
increasingly popular among consumers. We agree with Verizon that
bundles can be economically efficient and benefit consumers, and allow
video programming service providers to distinguish themselves.\69\ As
part of the NPRM, the Commission asked for comment on whether to apply
the ``all-in'' rule in circumstances where the cable operator or DBS
provider bundles video programming with other services like broadband
internet service.\70\ The Commission also inquired as to whether it was
possible to provide an ``all-in'' price, as Verizon explains, ``where
the video component has not been priced or itemized separately from the
bundle as a whole.'' \71\
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\69\ Verizon Comments at 11-12; Local Government Reply Comments
at 11 (describing how ``most streaming services offer very different
products from cable and DBS providers'').
\70\ NPRM, 2023 WL 4105426 at *2, para. 7.
\71\ Id.; Verizon Comments at 11.
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20. The record raises issues with how bundled service offerings
disclose and bill for the costs of video programming, particularly when
charges and fees for the video programming element of the bundle
increase due to a promotion schedule or otherwise. Consumer Reports
argues ``the video portion of a bundled offering should reflect the
required prominent all-in price of the equivalent stand-alone video
offering.'' \72\ Truth in Advertising notes ``deceptive pricing
tactics'' and comments that the rule should specifically address
bundled and related services.\73\ The Connecticut Office of State
Broadband submits that consumers would benefit from application of the
``all-in'' rule to the marketing and billing of oftentimes complicated
bundles that include video programing service with other services, like
phone and internet.\74\ They discuss consumer reports of deceptive
pricing specifically related to bundled services and are in favor of
applying the ``all-in'' rule for the video programming portion of a
bundled offering, ``because many bundles are discounted'' \75\ and
``the advertised prices for such bundles often omit fees that consumers
are ultimately charged,'' including video programming charges that
unexpectedly increase the bottom-line monthly price of the bundled
service.\76\
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\72\ Consumer Reports and Public Knowledge Comments at 12.
\73\ Truth in Advertising Comments at 6, 8 (``TINA.org supports
the Commission's commencement of a rulemaking proceeding to address
. . . deceptive pricing tactics, and also urges the FCC to
explicitly address bundled--and related--services in the text of the
proposed rule.'').
\74\ Connecticut Office of State Broadband Comments at 5
(explaining that ``because so many of the cable subscribers bundle
their video service with other services like phone and internet, the
All- In rules need to be tailored to ensure that bundled services
are not exempted'').
\75\ Consumer Reports and Public Knowledge Comments at 12.
\76\ Truth in Advertising Comments at 6, 7-8; Connecticut Office
of State Broadband Comments at 5-6.
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21. Verizon and NCTA argue that applying the ``all-in'' rule to
bundled packages that include video programming removes flexibility
necessary to offer competitive packages, while potentially adding to
consumer confusion. Verizon contends that the ``all-in'' rule
``threaten[s] to undermine this flexibility, by potentially requiring
carriers to advertise and bill for a stand-alone price where none
exists--that is, where the video component has not been priced or
itemized separately from the bundle as a whole.'' \77\ As NCTA
explains, video programming is ``frequently bundled with other
services, such as broadband . . . and voice services, resulting in
service packages that offer consumers a wide range of choices but do
not easily lend themselves to apples-to-apples comparisons between
providers.'' \78\ ``[R]equiring an all-in price for video for bundled
customers is also likely to increase customer confusion, not reduce
it,'' especially where the ``consumers have been purchasing the plans
for many years,'' \79\ Verizon asserts.
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\77\ Id. at 11-12 (explaining that some bundled offerings
``contain no standalone price of video service or any separate
video-specific discount, so providers would be forced into an
arbitrary allocation of the discount among the bundled services ''
and how Verizon has provided a breakdown of separate prices and
discounts for each service so customers can readily identify the
portion of the bill attributable to video service).
\78\ NCTA Comments at 7.
\79\ Verizon Comments at 12.
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22. We find that application of the ``all-in'' rule is warranted
when video programing service is offered and billed as part of a bundle
of services. Our
[[Page 28666]]
driving intent is to inform and enable consumers with information
regardless of the type of service agreement they have with a provider,
including agreements for bundles of services. Thus, in circumstances in
which a cable operator or DBS provider promotes or bills for a bundled
service that includes video programming as part of a bundle that will
result in a charge to a consumer, compliance with the ``all-in'' rule
requires clear, easy-to-understand, and accurate disclosure of the
aggregate customer fees and charges specific to video programming,\80\
and, if applicable, either the length of time that a promotional
discount will be charged or the date on which a time period will end
that will result in a price change for video programming. If a cable
operator or DBS provider charges (or will charge) for a cost related to
video programming in whole or in part (for example, charge for costs
related to local broadcast programming), then disclosure of those costs
must comply with the ``all-in'' rule. And if a discount is applied, it
also must be presented in clear, easy-to-understand, and accurate
terms, which includes any expiration date, if applicable, for
example.\81\ In that manner, consumers will be better informed about an
element of the service bundle that may lead to an unexpected charge or
fee. Providers are free to describe in their promotional materials the
value of bundling, including the discounts associated with bundling
various services.
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\80\ Because our intent is to inform consumers about the price
they are paying specifically for video programming and enable them
to comparison shop, we disagree with NCTA's contention that a
provider should have the option of complying with the ``all-in''
rule by stating the full price of the bundle, inclusive of all video
programming related fees. See NCTA Mar. 6 Ex Parte at 3.
\81\ Consumer Reports and Public Knowledge Comments at 12
(supporting disclosure of ``clear and concise terms, including any
expiration date''); see generally Empowering Broadband Consumers
Through Transparency, CG Docket No. 22-2, Report and Order (87 FR
76959, Dec. 16, 2022) and Further Notice of Proposed Rulemaking (87
FR 77048, Dec.16, 2022), FCC 22-86, 37 FCC Rcd 13686, 13695, para.
25 (rel. Nov. 17, 2022) (Broadband Transparency Order) (discussing
benefits of requiring the broadband label to ``clearly disclose
either the length of the introductory period or the date on which
the introductory period will end'')).
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23. Specific Implementation Issues Raised in the Record, Billing
Materials: Pricing Disclosures and Billing Material. The ``all-in''
rule requires providers to state the aggregate monthly (or regularly
occurring) price for video programming on billing material so that
consumers know the charges they will incur during the term of service
and when.\82\ We find requiring an ``all-in'' price on billing material
further enables consumers access to important information about the
cost of video programming, including increases in prices during the
term of service. DIRECTV contends that, as an alternative to the ``all-
in'' rule, the Commission could require that bills be ``accurate'' and
``disclose key information regarding programming-related fees clearly
and conspicuously and in close proximity to pricing.'' \83\ We do not,
however, accept that as an alternative to the ``all-in'' rule, as this
proposal is a more subjective alternative that would be difficult to
enforce and does not address issues identified in the record specific
to charges related to video programming. Thus, subscriber billing
material for video programming, standalone or otherwise, requires
inclusion of the aggregate monthly amount the subscriber's video
programming will ultimately cost including all video programming
related fees.\84\ If a price is introductory or limited in time, for
example, then the ``all-in'' rule requires customer billing to include
clear, easy-to-understand, and accurate disclosure of the date the
promotional rate ends (by stating either the length of a promotional
period or the date on which it will end), and the post-promotion ``all-
in'' rate (i.e., the roll-off rate) 60 and 30 days before the end of
any promotional period (as is necessary when offering a varying rate in
promotional material, discussed below).\85\
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\82\ See generally id. at 13695, para. 27.
\83\ DIRECTV Comments at 2.
\84\ See 47 U.S.C. 562(a)(1)-(3) (``Consumer Rights in Sales'').
\85\ The ``roll-off rate'' is the rate as calculated at the time
it is provided and does not require projections or estimates of what
the rate will be at the time the promotional rate expires. See NCTA
Mar. 6 Ex Parte at 2 (discussing how ``cable operators do not know
what their post-promotional rate will be, as rates are impacted by a
variety of factors not under their exclusive control''). We
recognize that rates may fluctuate during the term of the
promotional period, and as such, disclosure of the post-promotional
rate does not ``effectively freeze the rates that an operator can
charge during the promotional period,'' as NCTA posits. Id. To the
extent that a provider subject to this requirement has multiple or
graduated roll-off periods, the operator will need to provide the
roll-off rate 60 and 30 days before the end of each promotional
period. See NCTA Mar. 6 Ex Parte at 2 n.7 (discussing disclosure of
promotions that ``include graduated roll-off prices'').
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24. Grandfathered Service Plans. We are persuaded that the ``all-
in'' rule should apply to billing materials for legacy or grandfathered
service plans that cable operators and DBS providers no longer offer to
subscribers and when promotional material is used to market legacy
plans that are being renewed by customers. In the NPRM, the Commission
sought comment on whether the proposal should apply to existing
customers with legacy plans that are no longer available,\86\ and
industry commenters raise concern with how the ``all-in'' rule would
apply to existing subscribers with legacy or grandfathered plans.\87\
Verizon suggests we exempt legacy or grandfathered plans that are no
longer available to new customers as the Commission did with the
Broadband Nutrition Labels required of broadband internet service
providers. According to DIRECTV, ``[a]t a minimum, the Commission
should not seek to regulate bills for legacy offers not available to
new subscribers,'' which would have a ``substantially diminished
benefit for purposes of comparison shopping.'' \88\ Consumer Reports
disagrees, citing consumer benefits of pricing disclosures and suggests
the ``task need not be more complicated than a simple case of
addition'' of the ``all-in'' price.\89\
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\86\ See NPRM, 2023 WL 4105426 at *3, para. 9.
\87\ We refer to the terms ``legacy'' and ``grandfathered''
plans interchangeably; Verizon, for example, refers to legacy plans,
while the Commission considered similar issues in the Broadband
Transparency Order when discussing grandfathered plans. See
Broadband Transparency Order, 37 FCC Rcd at 13718-19, paras. 100-04.
\88\ DIRECTV Comments at 17 (citing Broadband Transparency
Order, 37 FCC Rcd at 13718, para. 100).
\89\ Consumer Reports and Public Knowledge Comments at 12.
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25. We are persuaded that consumers of legacy plans benefit as much
as consumers of available plans and that the benefits of providing an
``all-in'' price outweigh burdens described by industry.\90\ It is a
complicated process, according to Verizon, for it to apply an ``all-
in'' rule across a wide variety of pricing plans and content packages
that have changed over time to adapt to market forces, and we
appreciate the difficulties involved with changing various billing
formats all at once.\91\ We disagree, however, that inclusion of the
``all-in'' price on billing material for legacy plans will ``cause
unnecessary confusion.'' \92\ To the contrary, application of the
``all-in'' rule to the billing of legacy service plans, including
potentially long-term or renewable agreements, will benefit consumers'
knowledge of how much their video programming service costs. As for
[[Page 28667]]
promotional materials, grandfathered plans are not available to new
consumers by definition, and therefore we expect that cable operators
and DBS providers will not be marketing the services in a way that
would trigger the ``all-in'' rule. But if the operator or provider
issues promotional material used to inform or market a legacy plan to
existing customers that are subscribed to such plans, then that
material must include the ``all-in'' price.\93\ By applying the ``all-
in'' rule in this manner, we avoid unnecessary confusion to customers,
while enabling subscriber access to information that is key to their
understanding of the services they are purchasing under the
grandfathered plans and ability to comparison shop.\94\
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\90\ See DIRECTV Comments at 17; Verizon Comments at 4;
USTelecom Comments at 2-3 (citing DIRECTV Comments at 17; Verizon
Comments at 7).
\91\ Verizon Comments at 8 (``In addition, regulation of legacy
plans could provide an incentive for providers to eliminate them,
which would lead to further consumer disruption.'').
\92\ Verizon Reply Comments at 6 (``Requiring changes to these
customers' legacy bills would cause unnecessary confusion,
especially when they have been purchasing the same plans for many
years and are therefore fully aware of the total costs of the
services to which they subscribed.'').
\93\ As we discuss below, we apply the ``all-in'' rule to
promotional material to further our principal goal of allowing
consumers to comparison shop among services, but new customers
comparison shopping do not benefit from an ``all-in'' rule price for
service that is not available to them. See generally Broadband
Transparency Order, 37 FCC Rcd at 13718, para. 101 (``And such
labels may even confuse consumers if those plans are not actually
available to them.'').
\94\ Consumer Reports and Public Knowledge Comments at 7-8.
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26. Promotional Materials. Time-Limited Promotional Discounts. The
``all-in'' rule applies to promotional materials that state a price,
including in circumstances involving a promotional discount when the
amount billed to the customer by the cable operator or DBS provider may
change (for example, at the end of a promotional period). And if a
discount is applied, it also must be presented in clear, easy-to-
understand, and accurate terms, which includes any expiration date, if
applicable, for example. According to NCTA, consumers ``do not jump
immediately from advertising to bills,'' rather they typically go
through the ``sales process during which providers disclose the total
price that the consumer would pay, inclusive of the relevant fees.''
\95\ The record, however, indicates that the onboarding sales process
has not proven to be entirely effective.\96\ The record includes
evidence indicating persistent confusion over the price for video
programming, particularly with how the price for video programming is
described in promotional material and when the price may vary over the
term of the service agreement.
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\95\ NCTA Comments at 4-6.
\96\ See Local Governments Reply Comments at 1-2.
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27. We disagree that applying the ``all-in'' rule to promotional
rates will undermine transparency and potentially discourage the use of
promotions altogether.\97\ We find that knowledge of how a time-limited
discounted price will increase to the ultimate price the consumer will
be charged for video programming service gives consumers a reliable
idea of what they will pay each month that incorporates pricing
variables, and does so in a way that is uniform among providers and
enables comparison shopping. Compliance with the ``all-in'' rule
therefore includes disclosing the base (or standalone) rate with a
subtracted amount (the amount after application of any promotional
discount) in a way that enables consumers to know the amount they will
be required to pay each month (each billing cycle) during the term of
the service agreement.\98\ If, for example, a promotion or other
circumstance includes an introductory offer of free or discounted
channels and the ``all-in'' price will change at the conclusion of the
promotional period, then the cable operator or DBS provider must state
in promotional materials the current cost of video programming service
that the consumer will pay initially and state the ``all-in'' price
that applies following the introductory period or promotion.\99\ To the
extent that a provider subject to this requirement has multiple or
graduated roll-off periods, the operator must, at a minimum, provide
the initial promotional rate and the final rate after all promotional
discounts have expired. Consumers must simply be enabled to know what
amount they can expect to find as a charge on their bill, particularly
when the amount is scheduled to change due to promotions or other
circumstances.
---------------------------------------------------------------------------
\97\ DIRECTV Comments at 12.
\98\ As discussed above, this is the rate as calculated at the
time it is provided and does not require projections or estimates of
what the rate will be at the time the promotional rate expires. See
supra note 97.
\99\ See generally Broadband Transparency Order, 37 FCC Rcd at
13695, para. 25 (``We agree with those commenters that argue that
the label should also clearly disclose either the length of the
introductory period or the date on which the introductory period
will end.''). We decline to act on other issues, such as the City of
Seattle's contention that cable operators should not be able to
increase broadcast TV and regional sports fees during the
promotional period, considering our focus on the core issues
identified in the record relating to the disclosure of fees. City of
Seattle Comments at 6. We find this proposal goes beyond the scope
of this proceeding.
---------------------------------------------------------------------------
28. Regional And National Promotional Material. We conclude that
the ``all-in'' rule applies to regional and national promotions of
cable operators and DBS providers. Service providers raise concerns
with how an ``all-in'' pricing requirement would affect regional and
national promotional efforts.\100\ In the NPRM, the Commission asked
how it should account for national, regional, or local advertisements,
where the actual price may not be the same for all consumers receiving
the promotional materials due to market-specific price variation.\101\
DIRECTV argues that the ``all-in price proposal cannot account for
national advertising.'' \102\ DIRECTV predominantly advertises
nationally, but ``charges different [regional sports] fees in different
markets based on the differing fees it pays for access to those
[regional sports networks].'' \103\ According to DIRECTV, a single,
``all-in'' price afforded to everybody could ``provide inaccurate
information for most subscribers and potential subscribers no matter
what price DIRECTV may choose to provide.'' \104\ Likewise, NCTA states
that there is a potential that the ``all-in'' requirement ``would not
give consumers an accurate estimate of the all-in price for video
programming services available in their areas given the variation in
these fees.'' \105\ DIRECTV reports it may have to calculate a price
using the most expensive regional sports programming fees, which
``could artificially encourage customers and potential customers in
markets without [regional sports networks] or with lower-priced
[regional sports networks] to take service from one of DIRECTV's
competitors, particularly its unregulated online competitors.'' \106\
---------------------------------------------------------------------------
\100\ NCTA Reply Comments at 4.
\101\ See NPRM, 2023 WL 4105426 at *3, para. 9.
\102\ DIRECTV Comments at 11.
\103\ Id.
\104\ Id.
\105\ NCTA Comments at 5.
\106\ DIRECTV Comments at 11-12.
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29. We find these arguments merely support the need for Commission
action. A number of services and commodities are promoted and sold at
nationwide or regional prices that include varying local costs,
including services of cable operators and DBS providers.\107\ These
arguments support our conclusion that the manner in which promotional
and billing information is being communicated with consumers currently
is susceptible to costly misunderstandings. The separation of
programming fees (such as the cost of regional sports programming fees)
from the bottom-line, ``all-in'' price has been described as a leading
contributor to customer confusion we seek to address. Costs may vary
depending upon franchise area, as the NCTA, DIRECTV, and ACA explain,
but the exclusion of any and all amounts charged to the consumer for
video programming leads to significant issues,
[[Page 28668]]
as described in the record by individuals, organizations, and state and
local governments. We disagree, therefore, that programming fees should
be excluded from the ``all-in'' rule for regional or national
promotions.\108\
---------------------------------------------------------------------------
\107\ See, e.g., Thomas T. Nagle, John E. Hogan, Joseph Zale,
The Strategy and Tactics of Pricing (5th ed. 2011).
\108\ NCTA Comments at 5-6 (citing H.R. Rep. No 116-329, at 6).
---------------------------------------------------------------------------
30. To address the fact that certain costs vary by region, our rule
requires any advertised price to include all video programming fees
that apply to all consumers in the market that the advertisement is
targeted to reach. Providers may opt to provide a ``starting at''
price, or a range of prices that account for the fluctuation in video
programming fees in the locations that the advertisement is intended to
reach. In this case, when an aggregate ``all-in'' price is not stated
due to pricing fluctuation that depends on service location, the
provider must state where and how consumers may obtain their
subscriber-specific ``all-in'' price (for example, online at the
provider's website or by contacting a customer service or sales
representative). At the time the potential consumer provides location
information, online or otherwise, then the provider must state the
``all-in'' price. Providers also may state time-limited introductory
prices that are available to all potential customers the advertisement
is targeted to reach,\109\ if the advertised price includes the video
programming fees that apply to all consumers in the targeted market and
the consumer has the ability to obtain an ``all-in'' price before
ordering video programming, as discussed above.\110\ This allows
flexibility for service providers to highlight information in
promotional and billing material while providing transparency to
promotional material that reduces consumer confusion and enables
comparison shopping with a budgets in mind. Our goal is to enable
consumers to know the amount they will be billed for the service
offered.
---------------------------------------------------------------------------
\109\ NCTA Mar. 6 Ex Parte at 2.
\110\ See Consumer Reports and Public Knowledge Comments at 2
(discussing issues with prices increased outside of a ```locked-in'
promotional rate''). See generally Broadband Transparency Order, 37
FCC Rcd at 13695, para. 25 (``conclud[ing] that if a provider
displays an introductory rate in the label, it must also display the
rate that applies following the introductory period'').
---------------------------------------------------------------------------
31. Legal Authority. We conclude that the TVPA, section 632 of the
Act (covering cable operators), and section 335 of the Act (covering
DBS providers), in addition to ancillary authority, provide ample
authority for the ``all-in'' rule.\111\ We also conclude that the
``all-in'' rule is consistent with the First Amendment. In the NPRM,
the Commission asked ``whether we should consider expanding the
requirements of this proceeding to other types of [MVPDs] and on our
authority to do so.'' \112\ We decline to extend the ``all-in'' rule to
other entities at this time given the lack of record evidence
concerning the billing and advertising practices of non-cable and non-
DBS video services.\113\
---------------------------------------------------------------------------
\111\ 47 U.S.C. 335, 552.
\112\ NPRM, 2023 WL 4105426 at *1, para. 3.
\113\ See NCTA Comments at 12; NCTA Reply Comments at 7; ACA
Connects Comments at 16; DIRECTV Comments at 10-11.
---------------------------------------------------------------------------
32. Section 642 of the Act, 47 U.S.C. 562 (Television Viewer
Protection Act of 2019 (TVPA)). The Commission derives authority for
the ``all-in'' rule from the TVPA requirements as it applies to
electronic billing. Section 642 of the Act, as added by the TVPA,
requires MVPDs to bill subscribers transparently when the MVPD sends an
electronic bill, and specifically requires MVPDs to include in their
bills ``an itemized statement that breaks down the total amount charged
for or relating to the provision of the covered service by the amount
charged for the provision of the service itself and the amount of all
related taxes, administrative fees, equipment fees, or other charges.''
\114\ As mandated by this statutory directive, the ``all-in'' rule
requires cable operators and DBS providers to provide consumers with
the total charge for all video programming and will ensure that
consumers are provided complete and accurate information about the
``amount charged for the provision of the service itself,'' as Congress
intended.\115\ Such costs make up the charges for the ``provision of
the service itself'' because broadcast channels, regional sports
programming, and other programming track the statutory definition of
``video programming'' (that is, all are programming provided by, or
generally considered comparable to programming provided by, a
television broadcast station),\116\ and video programming is, by
definition, the service that an MVPD makes available for purchase.\117\
Listing such costs as below-the-line fees potentially results in
confusion for consumers about the ``amount charged for the provision of
the service itself,'' because the word ``itself'' suggests a single
charge for the total service rather than one charge for one portion of
the service and then a separate charge for other programming provided.
This contravenes Congress's core purpose for enacting the legislation:
to curb MVPDs' practice of charging ``unexpected and confusing fees,''
but the record, including recent press reports, suggest that this
practice continues.\118\
---------------------------------------------------------------------------
\114\ NPRM, 2023 WL 4105426 at *7, para. 16; 47 U.S.C.
562(b)(1), (d)(3) (defining ``covered service'' as ``service
provided by a multichannel video programming distributer [sic], to
the extent such distributor is acting as a multichannel video
programming distributor''); NCTA Reply Comments at 3 (noting that
the TVPA addresses transparency of payment by ``requiring electronic
bills to include an itemized statement that breaks down the total
amount charged for or relating to the provision of [video]
service'').
\115\ 47 U.S.C. 562(b)(1).
\116\ Id. Section 522(20) (``the term `video programming' means
programming provided by, or generally considered comparable to
programming provided by, a television broadcast station'').
\117\ Id. Section 522(13) (``the term `multichannel video
programming distributor' means a person such as, but not limited to,
a cable operator, a multichannel multipoint distribution service, a
direct broadcast satellite service, or a television receive-only
satellite program distributor, who makes available for purchase, by
subscribers or customers, multiple channels of video programming'').
\118\ Congress expressed specific concern that consumers face
``unexpected and confusing fees when purchasing video programming,''
including ``fees for broadcast TV,'' and noted that the practice of
charging these fees began in the late 2000s. H.R. Rep 116-329, at 6
(2019). We reject the claim that the ``only authority that the TVPA
gave the Commission'' was to grant MVPDs an additional six months to
comply with the statute. State Cable Ass'ns Mar. 5 Ex Parte at 4
n.19. The courts have affirmed the Commission's authority to
promulgate rules implementing a section of the Communications Act
without an explicit delegation to the Commission to interpret that
particular statutory section. See Alliance for Community Media v.
FCC, 529 F.3d 763, 773 (6th Cir. 2008) (affirming the Commission's
jurisdiction to promulgate rules implementing section 621(a)(1) of
the Communications Act even in the absence of an explicit delegation
of rulemaking power to the Commission in that statutory section).
---------------------------------------------------------------------------
33. We observe that the TVPA provides for the disclosure of a
second group of costs on electronic bills--i.e., ``the amount of all
related taxes, administrative fees, equipment fees, or other charges.''
\119\ Charges and fees relating to video programming (including
broadcast channels, regional sports programming, and other programming)
do not fall within this category because video programming, by
definition, is the service that an MVPD makes available for purchase--
in other words, the ``service itself.'' \120\ Thus, the most reasonable
reading of the statute is that the terms ``taxes,'' ``administrative
fees,'' ``equipment fees,'' or ``other charges'' do not include
separate charges for various types of video programming (e.g., amounts
paid for retransmission consent rights or rights to transmit regional
sports programming or any other programming).\121\ We
[[Page 28669]]
accordingly reject NCTA's argument that programming fees (such as
retransmission consent fees) fall within this ``second group'' of costs
on electronic bills.\122\
---------------------------------------------------------------------------
\119\ 47 U.S.C. 562(b)(1).
\120\ Id. Section 522(13).
\121\ The ``all-in'' rule is explicit that cable operators and
DBS providers may list certain discrete costs. 47 U.S.C. 542(c)
(Cable operators may identify, ``as a separate line item on each
regular bill of each subscriber, . . . [t]he amount of the total
bill assessed to satisfy any requirements imposed on the cable
operator by the franchise agreement to support public, educational,
or governmental channels or the use of such channels.'').
\122\ NCTA Comments at 6-7.
---------------------------------------------------------------------------
34. Section 632 of the Act, 47 U.S.C. 552 (Cable Operators). We
conclude that section 632 of the Act provides us with authority to
adopt the ``all-in'' rule as it will apply to cable operators.\123\
Section 632(b) of the Act provides the Commission authority to
establish customer service standards regarding billing practices and
other communications with subscribers, and the Commission has relied on
that authority for decades to regulate in this area.\124\ Section
632(b)(3) also supports the Commission adopting customer service
requirements regarding, among other enumerated topics, ``communications
between the cable operator and the subscriber (including standards
governing bills and refunds).'' \125\ The legislative history of
section 632 provides that ``[p]roblems with customer service have been
at the heart of complaints about cable television,'' and indicates
Congress' belief that ``strong mandatory requirements are necessary.''
\126\ Congress expected ``the FCC, in establishing customer service
standards to provide standards addressing . . . billing and collection
practices; disclosure of all available service tiers, [and] prices (for
those tiers and changes in service) . . . .'' \127\ Our ``all-in'' rule
addresses cable operators' billing practices, i.e., requiring clear,
easy-to-understand, and accurate price information in customer bills
for video programming service, and, therefore, is a customer service
matter within the meaning of section 632(b)(3). In addition, the
statute identifies the specific areas for the Commission to act as the
``minimum'' standards.\128\ Thus, by its terms, section 632(b) gives
the Commissions broad authority to adopt customer service standards
that go beyond those enumerated in the statute.\129\ We find that the
``all-in'' rule is also authorized under our general authority in
section 632(b) to establish ``customer service'' standards. The term
``customer service'' is not defined in the statute. In 1984, when
Congress first enacted section 632 authorizing franchising authorities
to establish customer service requirements, the legislative history
defined the term ``customer service'' to mean ``in general'' ``the
direct business relation between a cable operator and a subscriber,''
and goes on to explain that ``customer service requirements include . .
. the provision to customers (or potential customers) of information on
billing or services.'' \130\ In 1992, Congress retained this term when
amending section 632 to require the FCC to adopt ``customer service''
standards.\131\ The ``all-in'' rule imposes requirements on billing
information provided to potential customers in promotional materials,
which, as reflected in the legislative history, is a customer service
matter.\132\ Accordingly, billing communications in customer bills as
well as promotional materials and advertising aimed at potential
customers are precisely the type of customer service concerns that
Congress meant to address when it enacted section 632.\133\ Thus, the
``all-in'' rule covering bills, advertisements and promotional
materials is within the statute's grant of authority.
---------------------------------------------------------------------------
\123\ 47 U.S.C. 552.
\124\ See, e.g., Cable Service Change Notifications;
Modernization of Media Regulation Initiative; Amendment of the
Commission's Rules Related to Retransmission Consent, MB Docket Nos.
19-347, 17-105, 10-71, Report and Order, 35 FCC Rcd 11052, 11057,
para. 8 (2020) (85 FR 656, Jan. 7, 2020); Implementation of Section
8 of the Cable Television Consumer Protection and Competition Act of
1992; Consumer Protection and Customer Service, MB Docket Nos. 92-
263, Report and Order, 8 FCC Rcd 2892, 2906-07, paras. 65-66 (1993)
(58 FR 21107, April 19, 1993).
\125\ 47 U.S.C. 552(b).
\126\ See S.Rep. No. 92, 102nd Cong. 1st Sess. 1991 at 21-22,
reprinted in 1992 U.S.C.C.A.N. 1133, 1153; City of Local Franchise
Authorities Reply Comments at 6 (noting that Congress found that
``customer service requirements include requirements related to . .
. `provision[s] to customers (or potential customers) of information
on billing services''' (quoting H.R. Rep. No. 98-934, at 79 (1984)).
\127\ See S.Rep. No. 92, 102nd Cong. 1st Sess. 1991 at 21-22,
reprinted in 1992 U.S.C.C.A.N. 1133, 1153.
\128\ Id.
\129\ Id. (``The Commission shall . . . establish standards by
which cable operators may fulfill their customer service
requirements''); see, e.g., Cablevision v. FCC, 649 F.3d 695, 705-06
(D.C. Cir. 2011) (by requiring mandatory ``minimum'' regulations,
Congress established ``a floor rather than a ceiling,'' leaving the
Commission with authority to issue rules that go beyond those
specified in the statute); NCTA v. FCC, 567 F.3d 659, 664-65 (D.C.
Cir. 2009) (by describing the ``minimum contents of regulation'' the
statutory structure indicates that ``Congress had a particular
manifestation of a problem in mind, but in no way expressed an
unambiguous intent to limit the Commission's power solely to that
version of the problem'').
\130\ H.R. Rep. 98-934, at 79 (1984), reprinted in 1984
U.S.C.C.A.N. 4655, 4716 (emphasis added).
\131\ See S.Rep. No. 92, 102nd Cong. 1st Sess. 1991 at 21-22,
reprinted in 1992 U.S.C.C.A.N. 1133, 1153.
\132\ H.R. Rep. 98-934, at 79 (1984), reprinted in 1984
U.S.C.C.A.N. 4655, 4716 (emphasis added).
\133\ Local Franchise Authorities Comments at 3-4 (``The
Commission has statutory authority to establish additional customer
service standards for cable operators, including standards for
prospective subscribers'' under section 632 of the Act, as ``[t]he
proposed rule fits squarely in this provision with respect to cable
operators' billing standards for current subscribers.'').
---------------------------------------------------------------------------
35. We thus reject commenters' argument that covering ``non-
subscribers'' or ``potential subscribers'' under the ``all-in'' rule
renders it a ``consumer protection'' law under section 632(d) and thus
falls ``outside'' the Commission's authority, as evidenced by section
632's title, which distinguishes between customer service and consumer
protection.\134\ As mentioned above, the ``all-in'' rule, which covers
both current and potential subscribers, is a customer service
requirement that is authorized under section 632(b). Moreover, section
632(d) does not place any limitation on the Commission's authority;
rather it preserves States' and local governments' ability to enact and
enforce consumer protection laws and customer service requirements that
are not specifically preempted by the Cable Act.\135\ We likewise
reject commenters' argument that the text of the statute--which ``uses
the terms `customer' and `subscriber', and refers to `installations,
outages, and service calls', and discusses `bills and refunds' ''--
indicates that section 632 only addresses ``interactions between the
cable operators and current and former subscribers'' but ``not
potential subscribers.'' \136\ Those statutory terms are found in
subsection (b)'s list of specific areas for the Commission to address--
areas the statute makes clear are ``minimum'' requirements.\137\
Commenters' statutory-narrowing argument essentially reads out of the
provision the Commission's general grant of authority in subsection (b)
to ``establish standards by which cable operators may fulfill their
customer service requirements.'' \138\ Moreover, we are not persuaded
by commenters' argument that the use of the generic
[[Page 28670]]
term ``subscriber'' means ``actual cable subscribers'' and excludes
``potential subscribers'' from the authority granted under subsection
(b).\139\ We find that the better reading of the statute is that the
term ``subscriber'' is not limited to current subscribers because ``the
term [subscriber] is sufficiently ambiguous to include those
considering a subscription,'' as well as current subscribers
considering renewal and reviewing promotional material.\140\ Indeed,
those commenters arguing for a narrow construction concede that the
term ``subscriber'' used in subsection (b) can be read to cover both
``current and former subscribers.'' \141\ And their argument ignores
the legislative history, which, as discussed above, indicates
Congressional intent to cover under subsection (b) billing information
provided to both current and potential customers.\142\ This language
from the legislative history--including the expectation that the
Commission would adopt standards regarding ``disclosure of all
available service tiers, [and] prices''--suggests that Congress granted
the Commission authority over how cable operators disclose their prices
to consumers, including prices for services to which consumers may have
not yet subscribed.\143\
---------------------------------------------------------------------------
\134\ NCTA Reply Comments at 6.
\135\ 47 U.S.C. 552(d).
\136\ NCTA Reply Comments at 6; see also NCTA Comments at 8-9
(arguing that section 632(b) ``gives the Commission no authority to
adopt rules for advertisements and promotional materials addressed
to prospective subscribers among the general population, who are
plainly not `subscribers,' have no direct business relationship with
the cable operator, and do not receive the `bills and refunds'
mentioned in the text of the statute'') (emphasis in original);
Cable Company Reply Comments at 4-6 (arguing that section 632(b)
does not give the Commission authority to ``regulate communications
with the general public or `potential subscribers'''; rather,
section 632(b) uses the terms `customer' and `subscriber'. . . all
of which only address interactions between cable operators and
current and former subscribers'').
\137\ 47 U.S.C. 552(b)(1)-(3).
\138\ Id. section 552(b).
\139\ NCTA Comments at 8; NCTA Reply Comments at 6.
\140\ Consumer Reports and Public Knowledge Reply Comments at 7-
8 (discussing how ``the term `subscriber' need not be limited to
current subscribers [and] is sufficiently ambiguous to include those
considering a subscription (as well as those who have terminated
their subscription'').
\141\ NCTA Comments at 8 (emphasis added).
\142\ H.R. Rep. 98-934, at 79 (1984), reprinted in 1984
U.S.C.C.A.N. 4655, 4716.
\143\ See S.Rep. No. 92, 102nd Cong. 1st Sess. 1991 at 21-22,
reprinted in 1992 U.S.C.C.A.N. 1133, 1153.
---------------------------------------------------------------------------
36. Section 4(i) of the Act, 47 U.S.C. 154(i). Applying the ``all-
in'' rule's to the promotional materials of cable operators for video
programming is also a proper exercise of our authority under section
4(i) of the Act.\144\ The Commission is specifically delegated
authority under the Communications Act to adopt standards governing
communications between the cable operator and subscriber regarding
bills.\145\ Extending the ``all-in'' requirement to promotional
material when a price for video programming is offered is necessary to
achieve customer service standards in light of issues raised in the
record. Otherwise, consumers might be misled by confusing or misleading
pricing information from promotional material and enter into long-term
contracts with higher charges than understood would be due. This would
undermine the very purpose of the ``all-in'' rule as applied to bills,
which aims to ensure consumers receive clear, easy-to-understand, and
accurate pricing information.
---------------------------------------------------------------------------
\144\ See 47 U.S.C. 154(i).
\145\ See 47 U.S.C. 552(b)(3).
---------------------------------------------------------------------------
37. Section 335 of the Act, 47 U.S.C. 335 (Direct Broadcast Service
Providers). Section 335 of the Act provides the Commission with
authority to adopt the ``all-in'' rule as it will apply to direct
broadcast satellite (DBS) providers.\146\ Our action is supported,
specifically, by section 335(a), which provides the Commission with
authority to impose ``public interest or other requirements for
providing video programming'' on DBS providers.\147\ We conclude that
the ``all-in'' rule is a public interest requirement that falls
squarely within our authority under section 335(a).\148\
---------------------------------------------------------------------------
\146\ 47 U.S.C. 335.
\147\ Id. Section 335(a). See also id. section 303(v) (granting
the Commission ``exclusive jurisdiction to regulate the provision of
direct-to-home satellite services'').
\148\ See 47 U.S.C. 335.
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38. The Commission has previously confirmed, and we agree, that the
public interest includes consumer access to clear, easy-to-understand,
and accurate information about charges for service, which benefits a
well-functioning marketplace.\149\ The record reveals how promotional
and billing materials are critical to a consumer's understanding of
fees and charges relating to video programming, and that
misunderstandings from promotional material lead to subscribers going
over budget and billing disputes, often while locked into long-term
agreements.\150\ In addition to billing, we focus on the demonstrated
start of the customer's understanding of the pricing of video services,
and adopt the ``all-in'' rule to ensure consumers have accurate and
understandable information about the monthly cost in order to choose an
MVPD service that best suits his or her needs.\151\
---------------------------------------------------------------------------
\149\ See Broadband Transparency Order, 37 FCC Rcd at 13687,
para. 1.
\150\ NPRM, 2023 WL 4105426 at *5, para. 13.
\151\ See FCC v. WNCN Listeners Guild, 450 U.S. 582, 596 (1981)
(``[T]he Commission's judgment regarding how the public interest is
best served is entitled to substantial judicial deference.'').
---------------------------------------------------------------------------
39. DIRECTV's description of the limits of the Commission's
jurisdiction is inconsistent with the broad authority granted by
Congress in section 335(a), which grants authority to impose on DBS
providers ``public interest or other requirements for providing video
programming.'' \152\ We do not read the reference in section 335(a) to
adopt requirements for ``providing video programming'' as limiting our
authority to cover only public service carriage or programming
requirements on DBS providers, as DIRECTV contends,\153\ and we
disagree with DIRECTV that our interpretation ``is inconsistent with
the text, structure and legislative history of the provision.'' \154\
Section 335(a) directs the Commission to impose on providers of DBS
service ``public interest or other requirements for providing video
programming.'' On its face, this language is broad in scope. And the
regulation we are adopting here is precisely the type of regulation
covered under the statute, i.e., our rule serves the public interest by
requiring DBS operators in ``providing video programming'' to ensure
consumers have clear, easy-to-understand, and accurate information
about the charges for service. DIRECTV, on the other hand, argues that
what Congress really intended was to grant the Commission limited
authority over public interest carriage requirements, such as carriage
of political advertising, educational programming, and other public
service uses.\155\ However, there is no ``carriage'' limitation in the
statutory text. Although section 335(a) specifies certain topics that
must be addressed by the Commission (including political advertising
requirements in sections 312(a)(7) and 315 of the Act), the list is not
exhaustive. Because section 335(a) states that the regulations must
address these topics ``at a minimum,'' \156\ the Commission has
authority to adopt public interest requirements beyond those enumerated
in the statute. DIRECTV also argues that reading section 335(a) to
authorize the ``all-in'' rule would render ``redundant'' the ``prices,
terms and conditions'' provision in section 335(b)(3) covering carriage
obligations for noncommercial, educational programming.\157\ We reject
this argument. Our rule does not impose requirements on ``reasonable
prices, terms, and conditions,'' as directed under section 335(b)(3).
Rather our rule is a public interest requirement directed at ensuring
DBS providers are transparent about the price they have chosen to
charge for their service. Thus, there is no redundancy.
---------------------------------------------------------------------------
\152\ 47 U.S.C. 335(a). See also 47 U.S.C. 303(v) (granting the
Commission ``exclusive jurisdiction to regulate the provision of
direct-to-home satellite services'').
\153\ See 47 U.S.C. 335.
\154\ DIRECTV Comments at 2. See also DIRECTV Mar. 7 Ex Parte at
1-2.
\155\ See id. at 4.
\156\ 47 U.S.C. 335(a).
\157\ DIRECTV Comments at 4-5.
---------------------------------------------------------------------------
40. To be sure, the legislative history suggests that when enacting
section
[[Page 28671]]
335(a), Congress was focused on potential requirements to be placed on
DBS providers with respect to public service programming.\158\ However,
``rarely have [courts] relied on legislative history to constrict the
otherwise broad application of a statute indicated by its text.'' \159\
Contrary to DIRECTV's assertion,\160\ the legislative history cannot
overcome the clearest and most common sense reading of the language of
the statute, which does not limit our authority only to national
educational programming.\161\ The ``all-in'' rule is a ``public
interest or other requirement[]'' for providing video programming that
we find falls within our jurisdiction under section 335(a).\162\ The
``all-in'' rule is not an imposition of ``sweeping new authority over
DBS,'' \163\ nor is the Commission ``assert[ing] that [section 335(a)
of the Act] confers power to regulate virtually all other terms and
conditions of service as well,'' including general regulation of terms,
conditions, and pricing for DBS service.\164\ Our prior invocation of
section 335(b) to reserve channel capacity for noncommercial
programming of an educational or informational nature does not preclude
targeting non-carriage related problems when they arise under section
335(a), as the ``all-in'' rule does with a specific public interest
problem raised in the record.\165\ Moreover, the requirement we adopt
for DBS providers here as necessary to protect consumers from
misleading pricing information, is a proper exercise of the
Commission's other authority in Title III, which courts have found
endow the Commission with ``expansive powers'' and a ``comprehensive
mandate to `encourage the larger and more effective use of radio in the
public interest.' '' \166\
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\158\ See id. at 5 (citing H.R. Rep. No. 102-862, 100 (1992)
(Conf. Rep.), reprinted in 1992 U.S.C.C.A.N. 1231, 1282).
\159\ Consumer Electronics Ass'n v. FCC, 347 F.3d 291, 298 (D.C.
Cir. 2003) (citations omitted). The court further noted that ``the
Supreme Court has consistently instructed that statutes written in
broad, sweeping language should be given broad, sweeping
application.'' Id. (citing New York v. FERC, 1225 S. Ct. 1012, 1025
(2002) (``where Congress uses broad language, evidence of a specific
`catalyz[ing] force for the enactment `does not define the outer
limits of the statute's coverage' ''); PGA Tour, Inc. v. Martin, 532
U.S. 661, 689 (2001) (``[T]he fact that a statute can be applied in
situations not expressly anticipated by Congress does not
demonstrate ambiguity. It demonstrates breadth.'')).
\160\ See DIRECTV Comments at 4-5 (arguing that the legislative
history of section 335 is specific to educational programming, and
not broader authority and discussing the ``Conference Report
explain[ing] that the purpose . . . was to `define the obligation of
direct broadcast satellite service providers to provide a minimum
level of educational programming,' as well as the `capacity to be
allotted' to `noncommercial public service uses' '' (citing H.R.
Rep. No 102-10-862, 100 (1992) (Conf. Rep.), reprinted in 1992
U.S.C.C.A.N. 1231, 1282)), 5-6 (arguing that necessary ancillary
jurisdiction for the Commission to regulate DBS bills and
advertising, such jurisdiction would require: (1) the Commission's
general jurisdictional grant under Title I covering the regulated
subject; and (2) that the regulations are reasonably ancillary to
the Commission's effective performance of its statutorily mandated
responsibilities (citing American Library Ass'n v. FCC, 406 F.3d
689, 691-92 (D.C. Cir. 2005)).
\161\ Consumer Reports and Public Knowledge Reply Comments at 6
(noting legislative history does not accurately reflect Congress's
intent ``especially where such an interpretation would mark a
radical departure from the general structure of the Act'') (citing
National Petroleum Refiners Ass'n v. FTC, 482, F.2d 672, 693 (D.C.
Cir. 1973); American Hosp. Ass'n v. NLRB, 499 U.S. 606, 613-14
(1991)).
\162\ DIRECTV Comments at 3 (citing the Television Viewer
Protection Act of 2019, Pub. L. 116-94, 133 Stat. 2534 (2019)).
\163\ Id. at 3-7 (acknowledging that section 335 of the Act
confers authority to the Commission to impose public interest or
other requirements for providing video programming, while arguing
that ``[p]roperly understood, the statute confers authority to
impose public service carriage or programming requirements on DBS
providers but provides no authority to mandate specific terms or
conditions of service''); Consumer Reports and Public Knowledge
Reply Comments at 8 (arguing that section 335(a) did not create new
authority, but obligated the Commission to ``use existing
authority--with a deadline of 180 days to complete an initial
rulemaking'').
\164\ Id. at 7.
\165\ See 47 U.S.C. 335. See also DIRECTV Comments at 4 (arguing
that section 335 limits the Commission's authority to ``specific
public interest carriage requirements (that is, carriage of
political advertising, educational programming, and other public
service uses), not general regulation of terms and conditions of DBS
service''), 7 (``The Commission cannot rely on a single clause in a
decades-old provision about carriage requirements to assert sweeping
new authority over DBS.'').
\166\ Cellco Partnership v. FCC, 700 F.3d 534, 542 (D.C. Cir.
2012). Thus, we rely on other delegations of authority in Title III
for adoption of the ``all-in'' rule, including sections 303(b)
(which directs the Commission, consistent with the public interest,
to ``[p]rescribe the nature of the service to be rendered by each
class of licensed stations and each station within any class),
303(r) (which supplements the Commission's ability to carry out its
mandates via rulemaking), and 316 (which enables the Commission to
alter the term of existing licenses by rulemaking). 47 U.S.C.
303(b), (r), 316. See also Consumer Reports and Public Knowledge
Reply, at 5 (``Even if DIRECTV were correct with regard to the
limitation of Section 335, the Commission has ample authority to
impose the proposed rule under its general authority to set service
rules for wireless licensees under Sections 303(b) and 303(r)'').
---------------------------------------------------------------------------
41. DIRECTV analogizes the authority granted to the Commission in
section 335 with statutes conferring administration authority to the
Department of Health and Human Services (Department) that the D.C.
Circuit found did not support its regulation of advertisements of
certain pharmaceuticals.\167\ The circumstances of that decision are
distinguishable. In Merck & Co., the Department argued that its
regulation was `` `necessary' to [a pharmaceutical] programs'
`administration,' '' and the court found that ``the Secretary must
demonstrate an actual and discernible nexus between the rule and the
conduct or management of Medicare and Medicaid programs.'' \168\ The
nexus was too attenuated, the court concluded, ``stray[ing] far off the
path of administration for four reasons.'' \169\ The authority granted
under section 335, on the other hand, does not provide ``general
administrative authority'' to the Commission.\170\ Under section 335, a
rule must further a ``public interest or other requirement[ ] for
providing video programming,'' which the ``all-in'' rule does: it
protects the public interest by requiring truth in billing and
advertisements for video programming.\171\
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\167\ DIRECTV Comments at 8-9 (citing Merck & Co., Inc. v. U.S.
Dep't of Health & Human Svcs., 962 F.3d 531 (D.C. Cir. 2020)).
\168\ Merck & Co., 962 F.3d at 539.
\169\ Id. at 539, 541 (``hold[ing] only that no reasonable
reading of the Department's general administrative authority allows
the Secretary to command the disclosure to the public at large of
pricing information that bears at best a tenuous, confusing, and
potentially harmful relationship to the Medicare and Medicaid
programs'').
\170\ Merck & Co., 962 F.3d 541.
\171\ DIRECTV Comments at 3 (citing the Television Viewer
Protection Act of 2019, Pub. L. 116-94, 133 Stat. 2534 (2019)).
---------------------------------------------------------------------------
42. Section 4(i) of the Act, 47 U.S.C. 154(i). In addition, we find
authority to extend the ``all-in'' rule to DBS providers under section
4(i) of the Act.\172\ The Commission is specifically delegated
authority under the Communications Act to adopt standards governing
communications between the cable operator and subscriber.\173\
Extending the ``all-in'' requirement imposed on cable operators to DBS
is necessary for our exercise of this specifically delegated power.
Otherwise, consumers might opt for DBS service based on confusing or
misleading pricing information over service offered by cable operators
that are required to be transparent about the price they are charging.
This would undermine the very purpose of the ``all-in'' rule that we
are imposing on cable operators. Thus, by extending our rule to DBS
providers, we will ensure uniformity of regulation between and among
cable operators (regulated under Title VI and by various state consumer
protection laws and local franchising provisions) and DBS providers
(under Title III).\174\
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\172\ 47 U.S.C. 154(i).
\173\ 47 U.S.C. 552.
\174\ See, e.g., Mobile Comm'ns Corp. v. FCC, 77 F.3d 1399,
1405-06 (D.C. Cir. 1996) (upholding reliance on 4(i) for the
Commission to adjust the terms of preferences to reduce the gulf
between recipients of preferences (who would otherwise receive a
free license) and other license aspirants (who, under the new
auction regime, would have to pay for a license)).
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[[Page 28672]]
43. Other Federal Statutes. Contrary to arguments raised by
industry commenters, the TVPA does not preclude the ``all-in''
rule.\175\ We recognize that Congress did not include ``language in the
original version of the TVPA that would have required all-in pricing in
advertisements and other marketing.'' \176\ The lack of such a
requirement in the TVPA, however, does not preclude the Commission from
exercising its powers outside the TVPA (i.e., under Titles III, VI, and
section 4(i)) over promotional materials including advertising.\177\
With the TVPA, Congress addressed a specific customer service issue,
but there is no indication that Congress intended to restrict other
authority of the Commission to address these types of issues.\178\
First, Congress enacted the TVPA in 2019 to address a specific issue
relating to basic protections to consumers when purchasing MVPD
services.\179\ There is nothing in the TVPA to demonstrate that
Congress intended to repeal, supplant or otherwise disturb the
Commission's existing statutory authority over cable customer service
provided under section 632 or public interest requirements for DBS
providers under section 335. Legislative history also makes clear that
the TVPA was ``provid[ing] basic protections'' targeted at a particular
concern of Congress, but nowhere does it suggest Congress's intent to
repeal, supplant or otherwise disturb the Commission's other existing
authority.\180\ Second, the TVPA's focus is on electronic billing, but
we do not rely on the TVPA to apply the ``all-in'' rule to promotional
materials. Rather, we rely on other authority (sections 632 (cable
operators) of the Act, 335 (DBS providers), and 4(i) (ancillary
jurisdiction) \181\) to implement customer service obligations that are
not foreclosed by the TVPA.
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\175\ NCTA Comments at 6 (``If anything, the TVPA's mandate that
MVPDs itemize all applicable charges on bills if the MVPDs add them
to the price of the package precludes the Commission's proposal to
require'' an all-in price.), 9 (arguing that ``the TVPA provides no
authority for the adoption of the proposed rule and in fact
militates against adoption'').
\176\ Id. at 5 (citing the Television Viewer Protection Act of
2019, H.R. 5035, 116th Cong., sec. 4 (2019)), 6 (arguing ``the
TVPA's mandate that MVPDs itemize all applicable charges on bills if
the MVPDs add them to the price of the package precludes the
Commission's proposal to require'' all-in pricing), 9-10 (``The
express decision to omit statutory authority to impose an all-in
pricing rule for advertising and promotional materials in Congress'
most recent legislative enactment on consumer disclosures strongly
suggests that the Commission lacks such authority.''); See also
State Cable Ass'ns Mar. 5 Ex Parte at 3-4.
\177\ See Consumer Reports and Public Knowledge Reply Comments
at 5 (``Where Congress has not provided direct instruction to the
Commission on how to proceed, the Commission may act pursuant to its
general rulemaking power and the grant of authority inherent in an
ambiguous statute.'') (citing Alliance for Community Media v. FCC,
529 F.3d 763, 773-75 (6th Cir. 2008)).
\178\ See NCTA Comments at 5.
\179\ Id. at 15; H.R. Rep 116-329, at 1 (2019) (``The purpose of
this legislation is to address two provisions of law expiring at the
end of 2019 that facilitate the ability of consumers to view
broadcast television stations over [MVPD] services and to provide
basic protections to consumers when purchasing MVPD services and
certain broadband equipment.'').
\180\ H.R. Rep 116-329, at 1 (2019).
\181\ 47 U.S.C. 552, 335, 154(i).
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44. The First Amendment. We affirm the Commission's tentative
conclusion in the NPRM that the proposed ``all-in'' rule is consistent
with the First Amendment.\182\ When adopting truth-in-billing,
advertising, and labeling rules in similar contexts, the Commission has
found that ``[c]ommercial speech that is misleading is not protected
speech and may be prohibited,'' and ``commercial speech that is only
potentially misleading may be restricted if the restrictions directly
advance a substantial governmental interest and are no more extensive
than necessary to serve that interest.'' \183\ The same is true here.
The speech implicated here is information in bills and promotional
materials about the cost of video programming service offered by cable
operators and DBS providers, which the record shows consumers currently
find misleading. Thus, our proposed rule simply prevents misleading
commercial speech, which is afforded no protection under the First
Amendment.\184\
---------------------------------------------------------------------------
\182\ NPRM, 2023 WL 4105426 at *8, para. 17. See generally
Broadband Transparency Order, 37 FCC Rcd at 13725, para. 122 (citing
Empowering Consumers to Prevent and Detect Billing for Unauthorized
Charges (``Cramming''), Consumer Information and Disclosure, Truth-
in-Billing, and Billing Format, CG Docket Nos. 11-116, 09-158, CC
Docket No. 98-170, Report and Order (77 FR 30915, May 24, 2012) and
Further Notice of Proposed Rulemaking (77 FR 30972, May 24, 2012),
27 FCC Rcd 4436, 4482-84, paras. 129-35 (2012) (applying Zauderer v.
Office of Disciplinary Counsel, 471 U.S. 626 (1985); Central Hudson
Gas & Elec. Corp. v. Public Serv. Comm'n of New York, 447 U.S. 557
(1980); Restoring Internet Freedom Order, WC Docket No. 17-108,
Declaratory Ruling, Report and Order, and Order, 33 FCC Rcd 311,
448-50, paras. 235-38 (2017) (83 FR 7852, Feb. 22, 2018) (concluding
that the Commission need not resolve whether Zauderer or Central
Hudson applied because the transparency rule satisfied even the
Central Hudson standard); Local Government Reply Comments at 18
(``Because the extension of First Amendment protection to commercial
speech is justified principally by the value to consumers of the
information such speech provides, appellant's constitutionally
protected interest in not providing any particular factual
information in his advertising is minimal.'' (citing American Meat
Inst. v. U.S. Dept. of Agric., 760 F.3d 18, 22 (D.C. Cir. 2014) (en
banc) (quoting Zauderer, 471 U.S. at 650)).
\183\ See NPRM, 2023 WL 4105426 at *8, para. 17 (citing Truth-
in-Billing and Billing Format, CC Docket No. 98-170, First Report
and Order (64 FR 34488, June 25, 1999) and Further Notice of
Proposed Rulemaking (64 FR 34499, June 25, 1999), 14 FCC Rcd 7492,
7530-31, para. 60 (1999) (citing Central Hudson, 447 U.S. at 563-64,
566 (``The government may ban forms of communication more likely to
deceive the public than to inform it.'')). See also Broadband
Transparency Order, 37 FCC Rcd at 13725-26, para. 123; Consumer
Reports and Public Knowledge Reply Comments at 9 (``Rules to
prohibit advertising and billing practices that mislead and confuse
consumers are not constitutionally protected.'').
\184\ Central Hudson, 447 U.S. at 563 (``there can be no
constitutional objection to the suppression of commercial messages
that do not accurately inform the public about lawful activity'' and
``[t]he government may ban forms of communication more likely to
deceive the public than to inform it'') (citations omitted).
---------------------------------------------------------------------------
45. In the alternative, even if our ``all-in'' rule regulates only
potentially misleading speech, regulations involving commercial speech
\185\ that require a disclosure of factual information (such as the
disclosure of the total cost for video programming service that the
``all-in'' rule would require) are entitled to more lenient review from
courts than regulations that limit speech.\186\ A speaker's commercial
speech rights are adequately protected as long as disclosure
requirements are reasonably related to the government's interest in
preventing deception of consumers.\187\ We conclude that we have met
this standard. As an initial matter, for promotional materials, the
rule applies only when the cable or DBS provider chooses to state
information about price. The rule we adopt does not mandate pricing
information if the cable or DBS provider decides not to state
information about price. In those cases where the cable or DBS operator
chooses to state information about price, the ``all-in'' rule requires
only that the operator disclose accurate information about the total
cost for video programming service, and the disclosure requirement is
reasonably related to the government's interest in preventing an
oftentimes costly deception of consumers.\188\ The rule does not
prevent cable operators and DBS providers from conveying any additional
information. A cable operator's or DBS provider's constitutionally
protected interest in not providing the cost a subscriber will be
[[Page 28673]]
charged for video programming service is ``minimal.'' \189\
---------------------------------------------------------------------------
\185\ Id. at 561 (explaining ``commercial speech'' as
``expression related solely to the economic interests of the speaker
and its audience'').
\186\ See Zauderer, 471 U.S. at 651-52. See also Milavetz,
Gallop, & Milavetz v. U.S., 559 U.S. 229, 249-50 (2010); Consumer
Reports and Public Knowledge Reply Comments at 10 (arguing that
regulations involving commercial speech that require a disclosure of
factual information (like the all-in cost of service) ``are entitled
to more lenient review from courts than regulations that limit
speech'').
\187\ Zauderer, 471 U.S. at 651.
\188\ See, e.g., Truth in Advertising Comments at 4.
\189\ Zauderer, 471 U.S. at 651.
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46. Further, as the Commission discussed in the NPRM, even if our
rule is subject to the more stringent test of commercial speech (i.e.,
intermediate scrutiny), we find that the rule passes that three-prong
test that the Supreme Court established in Central Hudson: first, the
government must assert a substantial interest in support of its
regulation; second, the government must demonstrate that the
restriction on commercial speech directly and materially advances that
interest; and third, the regulation must be ``narrowly drawn.'' \190\
We have a longstanding substantial interest in ensuring that consumers
receive sufficient information to understand the full cost of video
programming to which they subscribe, and make informed purchasing
decisions as they consider competing cable and DBS service options. Our
``all-in'' rule advances this interest by requiring cable operators and
DBS providers to identify the cost for video programming as a clear,
easy-to-understand and accurate line-item on consumer bills and
promotional materials, allowing consumers to identify the full cost of
video programming. Finally, the ``all-in'' rule is narrowly drawn to
focus on misleading (and potentially misleading) information, without
effect on other speech.
---------------------------------------------------------------------------
\190\ Central Hudson, 447 U.S. at 564-65 (finding ``the First
Amendment mandates that speech restrictions be `narrowly drawn' '').
---------------------------------------------------------------------------
47. Thus, as we explain above and as stated in the NPRM, we believe
the ``all-in'' rule we adopt is consistent with the requirements
described in Zauderer, as well as Central Hudson (assuming arguendo
that the Central Hudson standard is applicable).\191\ NCTA disagrees,
arguing that the ``all-in'' rule fails under the standard of Zauderer
and the test for commercial speech articulated in Central Hudson.\192\
According to NCTA, ``[h]ere, a mandate to provide an all-in price in
advertising and promotional materials would be unduly burdensome,
particularly for national companies that offer a national base price
but have additional charges that vary by state or locality.'' \193\
---------------------------------------------------------------------------
\191\ See Zauderer, 471 U.S. 626; Central Hudson, 447, U.S. 557.
\192\ NCTA Comments at 10-11.
\193\ Id. at 11.
---------------------------------------------------------------------------
48. We disagree that requiring clear, easy-to-understand, and
accurate information regarding the price of video programming in
promotional material and billing imposes an unreasonable burden or
comparative disadvantage.\194\ We mitigate potential burdens on cable
operators and DBS providers complying with the ``all-in'' rule by
applying it responsively to issues identified in the record (as
discussed above). For example, if promotional material is intended for
a variety of locations, or is nationwide, our ``all-in'' price
requirement will be satisfied if the promotion includes a range of
prices that include the highest ``all-in'' price a consumer could be
charged, or includes more than a single ``all-in'' price with ability
for the consumer to determine his or her ``all-in'' price.\195\ We also
were persuaded to add flexibility for marketing of grandfathered
serviced plans.
---------------------------------------------------------------------------
\194\ See id. (arguing that the Zauderer test is not met
because: ``The Commission does not offer any explanation for how its
proposed rule would apply to national marketing without
substantially hobbling it, or without putting national providers at
a significant disadvantage with respect to what they can advertise
as compared to competitors who are not similarly restricted.'').
\195\ Id.
---------------------------------------------------------------------------
49. NCTA argues that, with regard to the Central Hudson inquiry
required by courts, ``the Commission's proposed rule is woefully
underinclusive to serve its supposed substantial interest.'' \196\ NCTA
claims that regulating only cable and DBS providers would hinder
consumer choice ``given that other MVPDs would have greater flexibility
in how they present pricing information.'' \197\ We disagree that our
effort to restrict misleading promotional and billing material
contravenes the test of Central Hudson, assuming, arguendo, Central
Hudson is applicable. Under authority granted to the Commission to
prevent the types of consumer harm identified in the record, the ``all-
in'' rule simply prevents misleading commercial messages that do not
accurately inform current and potential subscribers about the price of
video programming service, which is afforded no protection under the
First Amendment.\198\
---------------------------------------------------------------------------
\196\ Id. at 11-12 (citing Nat'l Inst. of Family and Life
Advocates v. Becerra, 138 S. Ct. 2361, 2375 (2018)).
\197\ Id. at 12; ABC Television Affiliates Association Reply
Comments at 7 (``Fair treatment of consumers should not be based on
the technology used to deliver video services, but, rather, on the
clear risk to consumers posed by manipulative and unfair advertising
and billing practices that are pervasive in the market today.'').
\198\ NPRM, 2023 WL 4105426 at *8, para. 18 (citing Central
Hudson, 447 U.S. at 563 (holding ``there can be no constitutional
objection to the suppression of commercial messages that do not
accurately inform the public about lawful activity'' and ``[t]he
government may ban forms of communication more likely to deceive the
public than to inform it'') (citations omitted)). One commenter made
a passing reference to the possibility of ``heightened First
Amendment scrutiny'' applying because the rule applies only to
``certain participants in the video marketplace'' thus creating a
``speaker-based distinction.'' See NCTA Comments at 10. We reject
this argument. The all-in rule does not single out cable operators
or DBS providers for different treatment based on content or their
viewpoint, such that it might be argued we are imposing a content-
based regulation of speech. Nor has any commenter shown that to be
the case. Rather, the all-in rule applies to cable operators and DBS
operators because the record reveals that these operators, which
account for the overwhelming majority of MVPD subscribers, have
engaged in misleading pricing information leading to consumer
confusion. Most available data does not track other providers,
including OVS and MMDS. Based on S&P and other available data, we
estimate that cable and DBS combined constitute between 96 and 99
percent of all MVPD subscribership. See, e.g., S&P Global, U.S.
Multichannel Industry Benchmarks (providing data on subscribers to
cable, DBS, and total MVPD subscribers); S&P Global, Q4'21 leading
US video provider rankings (Apr. 8, 2022); Brian Bacon, S&P Global,
Consumer Insights: US SVOD user trends and demographics, Q1'22 (Apr.
7, 2022); 2022 Communications Marketplace Report, 37 FCC Rcd 15552,
paras. 218 (discussing Multichannel Video Programming Distributors
(MVDS) (citing S&P Global, U.S. Multichannel Industry Benchmarks),
328 (discussing AVOD (citing Seth Shafer, S&P Global, Economics of
Internet: State of US online video: AVOD 2021 (Nov. 30, 2021)). To
the extent information is brought to the Commission's attention
about other entities engaging in misleading pricing practices, we
will not hesitate to consider appropriate action.
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50. Existing Consumer Protections. We find the ``all-in'' rule
complements existing state, local, and Federal laws and regulations and
voluntary consumer protections. The promotional and billing information
of competing video programming service providers can be subject to
different laws and regulations, depending upon how and where the
service is promoted and provided. We share bifurcated authority with
state and local governments.\199\ For most services provided by cable
operators and DBS providers, customer service issues are generally
addressed by Federal and state governments with shared authority under
the Act. The Commission sets baseline customer service requirements at
the Federal level,\200\ and state and local governments tailor more
specific customer service regulations based on
[[Page 28674]]
their communities' needs.\201\ Aside from legal requirements, we
recognize that video programming service providers also ``have
incentives to provide promotional and billing material clearly to
consumers,'' which is especially true for subscribers with plans that
allow them to cancel at any time.\202\
---------------------------------------------------------------------------
\199\ 47 U.S.C. 552 (Consumer protection and customer service).
\200\ 47 U.S.C. 542. See also Implementation of Section
621(a)(1) of the Cable Communications Policy Act of 1984 as amended
by the Cable Television Consumer Protection and Competition Act of
1992, MB Docket No. 05-311, Second Report and Order, 22 FCC Rcd
19633, 19646, para. 27 (2007) (72 FR 65670, Nov. 23, 2007) (``The
statute's explicit language [in section 632] makes clear that
Commission standards are a floor for customer service requirements,
rather than a ceiling, and thus do not preclude [Local Franchise
Authorities (LFAs)] from adopting stricter customer service
requirements.''). See also Local Government Comments at 8
(discussing ``authority to adopt customer service requirements as
part of their cable franchise authority, 47 U.S.C. 552(a), and . . .
their police power to regulate consumer protection, 47 U.S.C.
552(d)''); NCTA Comments at 3-4 (citing 47 CFR 76.1602(b),
76.1603(b), 76.1619, 47 U.S.C. 552(d)(2)).
\201\ For example, local franchises often require refunds,
prompt credits for service outages, local consumer offices, customer
service standards for cable operator personnel, billing practices
disclosures, call center hours, response times to repair calls, and
procedures for unresolved complaints, and collect data regarding
cable operator responses to customers.'' Local Government Comments
at 9.
\202\ Verizon Comments at 9 n.21.
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51. State and Local Requirements. We find that the ``all-in'' rule
complements existing consumer protection efforts by targeting issues
raised in the comments about consumer confusion due to misleading
pricing, and in a way that state and local governments support. In
support of the ``all-in'' rule, the Local Franchise Authorities explain
that many cable service bills do not currently meet what they consider
to be basic standards of presenting clear, easy-to-understand, and
accurate charges, despite the TVPA, existing Commission rules, and
other formal and informal consumer protections. The Local Government
Commenters explain that state and local governments ``that adopt
consumer protection rules typically adopt, at a minimum, requirements
mandating that cable operators provide advance notice, typically 30
days, to consumers for any price change, or publicly available rate
card or schedule outlining current prices.'' \203\ In Connecticut, for
example, the line items that appear to represent retransmission consent
fees, the Connecticut Office of State Broadband explains, are often
confusing to consumers, and could be difficult to predict or
substantiate.\204\ The ``all-in'' rule addresses these issues by
complementing state and local requirements to inform consumers of which
costs relate specifically to the provision of video programming
service.
---------------------------------------------------------------------------
\203\ Local Government Comments at 9 (citing Boston/Comcast
Cable Television agreement (May 15, 2021), Sections 7.4 7.5, 12,
https://www.boston.gov/sites/default/files/file/2022/03/Comcastlicensesanssides20211005.pdf; and Fairfax County Code,
Chapter 9.2 Sec. 9.2-9-9(b) through (d), https://www.fairfaxcounty.gov/cableconsumer/sites/cableconsumer/files/assets/documents/pdf/cprd/fairfax-county-code-chapter-9.2.pdf).
\204\ Connecticut Office of State Broadband Comments at 7
(explaining that ``the amount itemized on the bill may be an
unsubstantiated number . . . [and] neither the Commission nor any
state has ever confirmed that the line item is an accurate
reflection of what the owners of the local stations collectively
charge of any given billing statement'').
---------------------------------------------------------------------------
52. The Television Viewer Protection Act of 2019, 47 U.S.C. 562
(TVPA) and Other Federal Requirements. Contrary to some commenters'
arguments, we find that the Television Viewer Protection Act of 2019
(TVPA) does not render the ``all-in'' rule unnecessary; rather, we find
that the rule complements the TVPA's consumer protections. Some
industry commenters argue that an ``all-in'' rule is unnecessary
because, in addition to other laws and regulations,\205\ the TVPA
``already requires [MVPDs] to disclose the all-in price for
multichannel video programming services, including non-governmental
fees and charges, both at the point of sale and in writing within 24-
hours of entering a contract for service, and to provide customers with
an opportunity to cancel without penalty.'' \206\ ACA asserts the TVPA
is ``working effectively.'' \207\ Industry also asserts that the TVPA
provides flexibility that allows individual cable operators to
implement how much video programming costs ``in a way that best suits
their customers and existing sales and billing systems.'' \208\
---------------------------------------------------------------------------
\205\ NCTA Comments at 4 (citing 15 U.S.C. 45(a); 16 CFR
310.3(a)(1)); NCTA Reply Comments at 2.
\206\ NCTA Comments at 4 (citing 47 U.S.C. 562(a)); ACA Connects
Comments at 8 (describing ``robust, existing mechanisms, including
sales and billing disclosure requirements enacted as part of the
[TVPA] that ensure that consumers signing up for video service
understand the rates they will pay'').
\207\ See ACA Connects Comments at 11 (``With the TVPA and other
safeguards in place, there is no indication of any gap in
transparency that the proposed `all-in' price requirement is
necessary to fill.'').
\208\ NCTA Comments at 1.
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53. According to the industry commenters, consumers greatly benefit
from the TVPA and service providers regularly meet and exceed its
requirements.\209\ Members of NCTA and ACA, for example, ``disclose in
promotional materials that the price for video service may include
additional fees, typically dependent on what customers purchase and
where they live,'' \210\ and service providers have ``every incentive
to provide prospective and existing customers with the best experience
possible, including by communicating with them clearly and
effectively.'' \211\ However, the record also reveals common and
widespread frustration from consumers, which reflects that there
continue to be significant issues in the marketplace regarding the
provision of information about fees and charges associated with video
programming.
---------------------------------------------------------------------------
\209\ See NCTA Reply Comments at 3 (charactering claims that
cable operators are not complying ``with the law or are otherwise
hiding fees from consumers are flatly incorrect and rely either on
data from before the enactment of the TVPA or misrepresentations of
current industry practices'').
\210\ NCTA Comments at 2; ACA Connects Comments at 8 (describing
the success with implementing the ``robust, existing mechanisms,
including sales and billing disclosure requirements enacted as part
of the [TVPA] that ensure that consumers signing up for video
service understand the rates they will pay'').
\211\ NCTA Comments at 3; Verizon Reply Comments at 8
(describing how many providers, such as Verizon, ` ``have adopted
the practice of breaking out retransmission consent fees and other
video programming fees on subscriber bills--not to mislead their
customers, but to help them understand the root cause of soaring
prices for cable service' '' (quoting ACA Connects Comments at 17)).
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54. We find the ``all-in'' rule complements how cable operators and
DBS providers comply with the TVPA.\212\ The TVPA requires certain
consumer protection disclosures be made at the point of sale,\213\ as
NCTA emphasizes, but the record does not support the conclusion ``that
consumers are fully informed.'' \214\ We, therefore, disagree that the
issues raised by commenters have ``already been explicitly addressed
and resolved by Congress'' and that our action implementing the ``all-
in'' rule is ``arbitrary and capricious.'' \215\ Congress, with the
TVPA, did not limit the Commission's ability to address consumer issues
that are within the scope of the Act, but beyond the requirements of
the TVPA.
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\212\ As Consumer Reports explains, ``Sections 642(a)(2) and
642(b) [(the TVPA)] both refer to situations where a consumer has
signed a contract with a provider, thus becoming a `subscriber,' ''
and it would be ``odd to argue that providers must show the all-in
price when the subscriber has the right to cancel within the 24 hour
period under Section 642(a), or when a provider provides an
electronic bill under Section 642(b), or when a subscriber renews
their subscription, but that the provider may lure the consumer into
the store or onto its website with a misleading price.'' Consumer
Reports and Public Knowledge Comments at 7.
\213\ See 47 U.S.C. 562.
\214\ See NCTA Comments at 5; Local Government Reply Comments at
16 (``A disclosure at the time of purchase will be less effective
pursuant to the TVPA if the consumer has already been confused by
misleading and inaccurate advertising that led up to a consumer's
decision to subscribe.'').
\215\ NCTA Comments at 5; NCTA Reply Comments 7-8 (arguing that
applying the ``all-in'' rule ``just to cable and DBS providers but
not to similarly situated competitors in the video marketplace would
be all the more legally suspect'').
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55. Notably, the TVPA does not address promotional materials that
include a price for video programming, as the ``all-in'' rule does,
which we find will address many issues described in the record.\216\
The City of Seattle reports, for example, that in their local
experience, ``even with the congressional oversight and subsequent
Television Viewer Protection Act of
[[Page 28675]]
2019, the practice of separating obligatory programming costs from the
service price, and listing them separately as fees continues making it
difficult for consumers to find clear service and pricing information
and to compare options within a provider or among other providers,''
especially where customers ``expect to use websites to find current
service and price options.'' \217\ The ``all-in'' rule addresses this
issue in a way the TVPA does not, and enables awareness of programming
fees that consumers will find helpful to understand the sources that
``are driving up cable bills.'' \218\
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\216\ Consumer Reports and Public Knowledge Reply Comments at 3
(``[T]he TVPA does nothing with respect to the price MVPDs can
advertise, preserving the practice of promoting a low teaser rate,
with the increasingly expensive raft of fees hidden in the fine
print to be revealed later . . . and it does not clear up any
confusion about what these fees are and who is charging them.'').
\217\ City of Seattle Comments at 4-5 (discussing images of
prospective subscribers' chats with customer service agents, who
were unable to provide a local rate or price information by
providing their zip code), 11-12.
\218\ ACA Connects Comments at 6-7; ABC Television Affiliates
Association Reply Comments at 4 (reporting that increases in MVPD
rates have risen ``more than three times the rate of inflation'').
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56. ACA argues that there is the potential for confusion about the
``true'' ``all-in'' price because that ``is not the all-in price that
any subscriber will actually pay.'' \219\ According to ACA, that amount
will include programming fees and ``also `taxes and other fees
unrelated to programming,' including equipment fees.'' \220\ ACA
maintains that in other contexts, the ```all-in' price of a
communications service would include such taxes and fees.'' \221\ We
recognize that other customer service or consumer protections may
require disclosure of a total price that includes fees and charges
unrelated to video programming, such as taxes. The ``all-in'' price
complements those requirements, including the TVPA, by addressing the
source of misunderstandings about the costs of video programming that
will be inclusive of the larger, total price, that includes charges and
fess unrelated to video programming.
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\219\ ACA Connects Comments at 15.
\220\ Id.
\221\ Id.
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57. The Federal Trade Commission (FTC). DIRECTV argues that
compliance with the ``all-in'' price rule could cause tension with FTC
directives, ``particularly with nationwide advertisements advertising
across localities with different [regional sports programming] fees.''
\222\ DIRECTV complains that seeking to comply with ``at least two sets
of potentially overlapping and perhaps conflicting regulation (not to
mention state-by-state FTC-like regulation) could present
``complications'' and ``challenges'' and could result in an ``overly
clunky advertisement or bill, likely to be both confusing and
ineffective.'' \223\ DIRECTV, however, does not identify any actual
regulations that overlap or conflict with the ``all-in'' pricing rule
we adopt here. In the absence of any evidence of an actual conflict, we
decline to refrain from adopting an ``all-in'' rule based simply on
vague, general, and conclusory burden claims. If in the future there
arises a concrete conflict, parties can seek clarification or waiver at
that time.
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\222\ DIRECTV Comments at 13.
\223\ Id.
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58. Competitive Effects. We find that the ``all-in'' rule will
increase transparency and enhance competition. As the Commission
recently explained, ``[c]onsumer access to clear, easy-to-understand,
and accurate information is central to a well-functioning marketplace
that encourages competition, innovation, low prices, and high-quality
services.'' \224\ The record demonstrates that the ``all-in'' rule will
serve consumers and promote competition by giving consumers access to
information so they can shop among various video services providers
more effectively.
---------------------------------------------------------------------------
\224\ See Broadband Transparency Order, 37 FCC Rcd at 13687,
para. 1.
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59. We disagree that competition among service providers has
supplanted the need for the ``all-in'' rule or outweigh its competitive
benefits. The Commission's authority in this area is not limited or
less beneficial to consumers confronting unexpected charges because the
marketplace is now more competitive. Although we recognize that
significant entry into the video marketplace has benefited consumers,
we do not rely on entry alone, consistent with Congress' directive to
protect consumers purchasing services when warranted.\225\ The
authority for the ``all-in'' rule, on which we rely, was not solely
concerned with competition, but with protecting consumers.
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\225\ See, e.g., 47 CFR 64.2401 (Truth-in-Billing Requirements);
Truth-in-Billing and Billing Format, CC Docket No. 98-170, Report
and Order and Further Notice of Proposed Rulemaking, 14 FCC Rcd
7492, 7501, para. 14 (1999) (``We emphasize that one of the
fundamental goals of our truth-in-billing principles is to provide
consumers with clear, well-organized, and non-misleading information
so that they may be able to reap the advantages of competitive
markets.'').
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60. Cost/Benefit Analysis. We adopt the ``all-in'' requirement
having considered the costs and benefits associated with adopting the
proposal. The purpose of this proceeding is to reduce confusion, in an
effective and narrow way that complements current consumer protections,
and mitigates the cost of unexpected charges and fees for consumers. No
commenter submitted a rigorous economic cost/benefit analysis, but we
note that certain commenters argued that an ``all-in'' rule ``would
create confusion--not clarity--for consumers, and impose undue burdens
on the Companies without any countervailing public benefit.'' \226\ We
disagree. The ``all-in'' rule will address consumer confusion
identified in the record that has led to household budget issues,
billing disputes, and litigation. Requiring clear, easy-to-understand,
and accurate pricing disclosure empowers consumer choice, possibly
improving customer satisfaction,\227\ and increases competition in the
video marketplace.
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\226\ Cable Company Reply Comments at 2; ACA Connects Comments
at 7. Cf. ABC Television Affiliates Association Reply Comments at 1
(``The Affiliates Associations fully support the comments of the
[NAB], which persuasively explain the public interest benefits that
would flow from adoption of new ``all-in pricing'' requirements.''
(citing NAB Comments)); NAB Comments at 1.
\227\ The American Customer Satisfaction Index 2023 ranked
subscription TV series 40th of 43 industries surveyed in terms of
customer satisfaction. American Customer Satisfaction Index, ACSI
Telecommunications Study 2022-2023 (June 6, 2023), https://theacsi.org/news-and-resources/press-releases/2023/06/06/press-release-telecommunications-study-2022-2023/.
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61. Digital Equity and Inclusion. The ``all-in'' rule furthers our
continuing effort to advance digital equity for all,\228\ including
people of color, persons with disabilities, persons who live in rural
or Tribal areas, and others who are or have been historically
underserved, marginalized, or adversely affected by persistent poverty
or inequality. As part of the NPRM, the Commission invited ``comment on
any equity-related considerations \229\ and benefits (if any) that may
be associated with the'' ``all-in'' rule and related issues and,
specifically, on how the ``all-in'' rule ``may promote or inhibit
advances in diversity, equity, inclusion, and accessibility, as well
the scope of the
[[Page 28676]]
Commission's relevant legal authority.'' \230\ We agree with the Local
Governments Commenters that the ``all-in'' rule promotes equity by
addressing unexpected fees and charges that disproportionately impact
lower-income households.\231\
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\228\ Section 1 of the Communications Act of 1934 as amended
provides that the FCC ``regulat[es] interstate and foreign commerce
in communication by wire and radio so as to make [such service]
available, so far as possible, to all the people of the United
States, without discrimination on the basis of race, color,
religion, national origin, or sex.'' 47 U.S.C. 151.
\229\ The term ``equity'' is used here consistent with Executive
Order 13985 as the consistent and systematic fair, just, and
impartial treatment of all individuals, including individuals who
belong to underserved communities that have been denied such
treatment, such as Black, Latino, and Indigenous and Native American
persons, Asian Americans and Pacific Islanders, and other persons of
color; members of religious minorities; lesbian, gay, bisexual,
transgender, and queer (LGBTQ+) persons; persons with disabilities;
persons who live in rural areas; and persons otherwise adversely
affected by persistent poverty or inequality. See E.O. 13985, 86 FR
7009, Executive Order on Advancing Racial Equity and Support for
Underserved Communities Through the Federal Government (January 20,
2021).
\230\ NPRM, 2023 WL 4105426 at * 9, para. 21.
\231\ Local Government Comments at 6 (``Equity concerns arise
with these undisclosed fees. . . . Regardless of whether vulnerable
households are more likely to pay junk fees, the same level fee will
account for a disproportionate share of a lower-income household's
total funds than that of a higher-income household.'').
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Procedural Matters
62. Regulatory Flexibility Act Analysis. The Regulatory Flexibility
Act of 1980, as amended (RFA),\232\ requires that an agency prepare a
regulatory flexibility analysis for notice and comment rulemakings,
unless the agency certifies that ``the rule will not, if promulgated,
have a significant economic impact on a substantial number of small
entities.'' \233\ Accordingly, we have prepared a Final Regulatory
Flexibility Analysis (FRFA) concerning the possible impact of rule
changes contained in the Report and Order on small entities. The FRFA
is set forth in Appendix C of the Report and Order.
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\232\ 5 U.S.C. 601-612. The RFA has been amended by the Small
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA),
Public Law 104-121, Title II, 110 Stat. 857 (1996).
\233\ 5 U.S.C. 605(b).
---------------------------------------------------------------------------
63. Final Paperwork Reduction Act Analysis. This document may
contain new information collection requirements subject to the
Paperwork Reduction Act of 1995 (PRA).\234\ Any such requirements will
be submitted to the Office of Management and Budget (OMB) for review
under Section 3507(d) of the PRA. OMB, the general public, and other
Federal agencies will be invited to comment on the information
collection requirements contained in this proceeding. The Commission
will publish a separate document in the Federal Register at a later
date seeking these comments. In addition, we note that, pursuant to the
Small Business Paperwork Relief Act of 2002 (SBPRA),\235\ we requested
specific comment on how the Commission might further reduce the
information collection burden for small business concerns with fewer
than 25 employees.\236\
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\234\ The Paperwork Reduction Act of 1995 (PRA), Public Law 104-
13, 109 Stat. 163 (1995) (codified in Chapter 35 of title 44
U.S.C.).
\235\ The Small Business Paperwork Relief Act of 2002 (SBPRA),
Public Law 107-198, 116 Stat. 729 (2002) (codified in Chapter 35 of
title 44 U.S.C.). See 44 U.S.C. 3506(c)(4).
\236\ NPRM, 2023 WL 4105426 at * 11, para. 26 (``seek[ing]
specific comment on how we might further reduce the information
collection burden for small business concerns with fewer than 25
employees''). No commenter addressed SBPRA.
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64. Congressional Review Act. The Commission has determined, and
the Administrator of the Office of Information and Regulatory Affairs,
OMB concurs, that these rules are ``non-major'' under the Congressional
Review Act, 5 U.S.C. 804(2). The Commission will send a copy of the
Report and Order to Congress and the Government Accountability Office
pursuant to 5 U.S.C. 801(a)(1)(A).
Final Regulatory Flexibility Act
65. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA),\237\ an Initial Regulatory Flexibility Act Analysis
(IRFA) was incorporated into the All-In Pricing for Cable and Satellite
Television Service, Notice of Proposed Rulemaking (NPRM) released in
June 2023.\238\ The Federal Communications Commission (Commission)
sought written public comment on the proposals in the NPRM, including
comment on the IRFA. No comments were filed addressing the IRFA. This
Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.\239\
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\237\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612, has been amended
by the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104-121, Title II, 110 Stat. 857 (1996).
\238\ See All-In Pricing for Cable and Satellite Television
Service, MB Docket No. 23-203, FCC 23-52, Notice of Proposed
Rulemaking, 2023 WL 4105426 (rel. June 20, 2023) (88 FR 42277, June
20, 2023) (NPRM).
\239\ 5 U.S.C. 604.
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66. Need for, and Objectives of, the Report and Order. The Report
and Order (Order) reflects the Commission's effort to enhance pricing
transparency by requiring cable operators and direct broadcast service
(DBS) providers to provide the ``all-in'' price for video programming
service in their promotional materials and on subscribers' bills. The
Commission received comments and ex parte filings from individuals,
consumer advocates, cable operators, DBS providers, broadcast industry
members, trade associations, state and local governments, and
franchising authorities. A number of comments describe general consumer
frustration with unexpected ``fees'' (for example, for broadcast
television programming and regional sports programming charges listed
separately from the monthly subscription rate for video programming
service) that are actually charges for the video programming service
for which the subscriber pays.
67. The Order largely adopts the rule proposed in the NPRM, with
certain limited exceptions or modifications, in response to comments in
the record. In the Order, we adopt the proposal in the NPRM to require
that cable operators and DBS providers provide the ``all-in'' cost of
video programming service as a prominent single line item on
subscribers' bills and in promotional materials. We require compliance
with the ``all-in'' rule when the price for video programming increases
during the term of the subscriber's service agreement and to national
and regional promotional materials where charges to consumers varies by
geography. We also acknowledge limitations that apply when the customer
has a residential legacy or grandfathered plan, and recognize that how
providers comply with the ``all-in'' rule may vary, if the price for
video programming is clear, easy-to-understand, and accurate.
68. Summary of Significant Issues Raised by Public Comments in
Response to the IRFA. There were no comments filed that specifically
addressed the proposed rules and policies presented in the IRFA.
69. Response to Comments by the Chief Counsel for Advocacy of the
Small Business Administration. Pursuant to the Small Business Jobs Act
of 2010, the Commission is required to respond to any comments filed by
the Chief Counsel for Advocacy of the Small Business Administration
(SBA), and to provide a detailed statement of any change made to the
proposed rules as a result of those comments.\240\
---------------------------------------------------------------------------
\240\ Id. section 604(a)(3).
---------------------------------------------------------------------------
70. The Chief Counsel did not file any comments in response to the
proposed rules in this proceeding.
71. Description and Estimate of the Number of Small Entities to
Which the Rules Will Apply. The RFA directs agencies to provide a
description of, and where feasible, an estimate of the number of small
entities that may be affected by the rules adopted herein.\241\ The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' \242\ In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act (SBA).\243\ A small business
[[Page 28677]]
concern is one which: (1) is independently owned and operated; (2) is
not dominant in its field of operation; and (3) satisfies any
additional criteria established by the SBA.\244\
---------------------------------------------------------------------------
\241\ Id. section 604(a)(4).
\242\ Id. section 601(6).
\243\ Id. section 601(3) (adopting by reference the definition
of ``small business concern'' in 15 U.S.C. 632(a)(1)). Pursuant to 5
U.S.C. 601(3), the statutory definition of a small business applies
``unless an agency, after consultation with the Office of Advocacy
of the Small Business Administration and after opportunity for
public comment, establishes one or more definitions of such term
which are appropriate to the activities of the agency and publishes
such definition(s) in the Federal Register.''Id.
\244\ 15 U.S.C. 632.
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72. The rule adopted in the Order will directly affect small cable
systems operators and DBS providers. Below, we provide a description of
such small entities, as well as an estimate of the number of such small
entities, where feasible.
73. Cable and Other Subscription Programming. The U.S. Census
Bureau defines this industry as establishments primarily engaged in
operating studios and facilities for the broadcasting of programs on a
subscription or fee basis.\245\ The broadcast programming is typically
narrowcast in nature (e.g., limited format, such as news, sports,
education, or youth-oriented). These establishments produce programming
in their own facilities or acquire programming from external
sources.\246\ The programming material is usually delivered to a third
party, such as cable systems or direct-to-home satellite systems, for
transmission to viewers.\247\ The SBA small business size standard for
this industry classifies firms with annual receipts less than $47
million as small.\248\ Based on U.S. Census Bureau data for 2017, 378
firms operated in this industry during that year.\249\ Of that number,
149 firms operated with revenue of less than $25 million a year and 44
firms operated with revenue of $25 million or more.\250\ Based on this
data, the Commission estimates that a majority of firms in this
industry are small.
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\245\ U.S. Census Bureau, 2017 NAICS Definition, ``515210 Cable
and Other Subscription Programming,'' https://www.census.gov/naics/?input=515210&year=2017&details=515210.
\246\ Id.
\247\ Id.
\248\ 13 CFR 121.201, NAICS Code 515210 (as of 10/1/22, NAICS
Code 516210).
\249\ U.S. Census Bureau, 2017 Economic Census of the United
States, Selected Sectors: Sales, Value of Shipments, or Revenue Size
of Firms for the U.S.: 2017, Table ID: EC1700SIZEREVFIRM, NAICS Code
515210, https://data.census.gov/cedsci/table?y=2017&n=515210&tid=ECNSIZE2017EC1700SIZEREVFIRM&hidePreview=false. The US Census Bureau withheld publication of the number of
firms that operated for the entire year to avoid disclosing data for
individual companies (see Cell Notes for this category).
\250\ Id. The available U.S. Census Bureau data does not provide
a more precise estimate of the number of firms that meet the SBA
size standard. We note that the U.S. Census Bureau withheld
publication of the number of firms that operated with sales/value of
shipments/revenue in all categories of revenue less than $500,000 to
avoid disclosing data for individual companies (see Cell Notes for
the sales/value of shipments/revenue in these categories).
Therefore, the number of firms with revenue that meet the SBA size
standard would be higher than noted herein. We also note that
according to the U.S. Census Bureau glossary, the terms receipts and
revenues are used interchangeably, see https://www.census.gov/glossary/#term_ReceiptsRevenueServices.
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74. Cable Companies and Systems (Rate Regulation). The Commission
has developed its own small business size standard for the purpose of
cable rate regulation. Under the Commission's rules, a ``small cable
company'' is one serving 400,000 or fewer subscribers nationwide.\251\
Based on industry data, there are about 420 cable companies in the
U.S.\252\ Of these, only seven have more than 400,000 subscribers.\253\
In addition, under the Commission's rules, a ``small system'' is a
cable system serving 15,000 or fewer subscribers.\254\ Based on
industry data, there are about 4,139 cable systems (headends) in the
U.S.\255\ Of these, about 639 have more than 15,000 subscribers.\256\
Accordingly, the Commission estimates that the majority of cable
companies and cable systems are small.
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\251\ 47 CFR 76.901(d).
\252\ S&P Global Market Intelligence, S&P Capital IQ Pro, U.S.
MediaCensus, Operator Subscribers by Geography (last visited May 26,
2022).
\253\ S&P Global Market Intelligence, S&P Capital IQ Pro, Top
Cable MSOs 12/21Q (last visited May 26, 2022); S&P Global Market
Intelligence, Multichannel Video Subscriptions, Top 10 (April 2022).
\254\ 47 CFR 76.901(c).
\255\ S&P Global Market Intelligence, S&P Capital IQ Pro, U.S.
MediaCensus, Operator Subscribers by Geography (last visited May 26,
2022).
\256\ S&P Global Market Intelligence, S&P Capital IQ Pro, Top
Cable MSOs 12/21Q (last visited May 26, 2022).
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75. Cable System Operators (Telecom Act Standard). The
Communications Act of 1934, as amended, contains a size standard for a
``small cable operator,'' which is ``a cable operator that, directly or
through an affiliate, serves in the aggregate fewer than one percent of
all subscribers in the United States and is not affiliated with any
entity or entities whose gross annual revenues in the aggregate exceed
$250,000,000.'' \257\ For purposes of the Telecom Act Standard, the
Commission determined that a cable system operator that serves fewer
than 498,000 subscribers, either directly or through affiliates, will
meet the definition of a small cable operator.\258\ Based on industry
data, only six cable system operators have more than 498,000
subscribers.\259\ Accordingly, the Commission estimates that the
majority of cable system operators are small under this size standard.
We note, however, that the Commission neither requests nor collects
information on whether cable system operators are affiliated with
entities whose gross annual revenues exceed $250 million.\260\
Therefore, we are unable at this time to estimate with greater
precision the number of cable system operators that would qualify as
small cable operators under the definition in the Communications Act.
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\257\ 47 U.S.C. 543(m)(2).
\258\ FCC Announces Updated Subscriber Threshold for the
Definition of Small Cable Operator, Public Notice, DA 23-906 (MB
2023) (2023 Subscriber Threshold PN). In this Public Notice, the
Commission determined that there were approximately 49.8 million
cable subscribers in the United States at that time using the most
reliable source publicly available. Id. This threshold will remain
in effect until the Commission issues a superseding Public Notice.
See 47 CFR 76.901(e)(1).
\259\ S&P Global Market Intelligence, S&P Capital IQ Pro, Top
Cable MSOs 06/23Q (last visited Sept. 27, 2023); S&P Global Market
Intelligence, Multichannel Video Subscriptions, Top 10 (Apr. 2022).
\260\ The Commission does receive such information on a case-by-
case basis if a cable operator appeals a local franchise authority's
finding that the operator does not qualify as a small cable operator
pursuant to Sec. 76.901(e) of the Commission's rules. See 47 CFR
76.910(b).
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76. Direct Broadcast Satellite (DBS) Service. DBS service is a
nationally distributed subscription service that delivers video and
audio programming via satellite to a small parabolic ``dish'' antenna
at the subscriber's location. DBS is included in the Wired
Telecommunications Carriers industry which comprises establishments
primarily engaged in operating and/or providing access to transmission
facilities and infrastructure that they own and/or lease for the
transmission of voice, data, text, sound, and video using wired
telecommunications networks.\261\ Transmission facilities may be based
on a single technology or combination of technologies.\262\
Establishments in this industry use the wired telecommunications
network facilities that they operate to provide a variety of services,
such as wired telephony services, including VoIP services, wired
(cable) audio and video programming distribution; and wired broadband
internet services.\263\ By exception, establishments providing
satellite television distribution services using
[[Page 28678]]
facilities and infrastructure that they operate are included in this
industry.\264\
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\261\ See U.S. Census Bureau, 2017 NAICS Definition, ``517311
Wired Telecommunications Carriers,'' https://www.census.gov/naics/?input=517311&year=2017&details=517311.
\262\ Id.
\263\ See id. Included in this industry are: broadband internet
service providers (e.g., cable, DSL); local telephone carriers
(wired); cable television distribution services; long-distance
telephone carriers (wired); closed-circuit television (CCTV)
services; VoIP service providers, using own operated wired
telecommunications infrastructure; direct-to-home satellite system
(DTH) services; telecommunications carriers (wired); satellite
television distribution systems; and multichannel multipoint
distribution services (MMDS).
\264\ Id.
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77. The SBA small business size standard for Wired
Telecommunications Carriers classifies firms having 1,500 or fewer
employees as small.\265\ U.S. Census Bureau data for 2017 show that
3,054 firms operated in this industry for the entire year.\266\ Of this
number, 2,964 firms operated with fewer than 250 employees.\267\ Based
on this data, the majority of firms in this industry can be considered
small under the SBA small business size standard. According to
Commission data, however, only two entities provide DBS service--
DIRECTV (owned by AT&T) and DISH Network, which require a great deal of
capital for operation.\268\ DIRECTV and DISH Network both exceed the
SBA size standard for classification as a small business. Therefore, we
must conclude based on internally developed Commission data, in general
DBS service is provided only by large firms.
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\265\ 13 CFR 121.201, NAICS Code 517311 (as of 10/1/22, NAICS
Code 517111).
\266\ U.S. Census Bureau, 2017 Economic Census of the United
States, Selected Sectors: Employment Size of Firms for the U.S.:
2017, Table ID: EC1700SIZEEMPFIRM, NAICS Code 517311, https://data.census.gov/cedsci/table?y=2017&n=517311&tid=ECNSIZE2017.EC1700SIZEEMPFIRM&hidePreview=false.
\267\ Id. The available U.S. Census Bureau data does not provide
a more precise estimate of the number of firms that meet the SBA
size standard.
\268\ See Annual Assessment of the Status of Competition in the
Market for the Delivery of Video Programming, Eighteenth Report,
Table III.A.5, 32 FCC Rcd 568, 595 (Jan. 17, 2017).
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78. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements for Small Entities. The Order requires cable
operators and DBS providers to state the aggregate cost for video
programming service in bills and any promotional material that presents
a cost for service as clear, easy-to-understand, and accurate
information.
79. The ``all-in'' rule must be fully implemented no later than (i)
9 months after release of the Report and Order or (ii) when the
Commission announces an effective date in the Federal Register pursuant
to the Paperwork Reduction Act, whichever is later; except that
compliance with this section is required no later than (i) 12 months
after release of the Report and Order or (ii) when the Commission
announces an effective date in the Federal Register pursuant to the
Paperwork Reduction Act, whichever is later, for small cable operators.
For the purpose of the rule, small cable operators are defined as those
with annual receipts of $47 million or less, consistent with the SBA's
small business size standards. We find that this is a reasonable amount
to time based upon prior experience with how the industry has
implemented TVPA billing requirements.\269\ The record does not include
a sufficient cost/benefit analysis that would allow us to quantify the
costs of compliance for small entities, including whether it will be
necessary for small entities to hire professionals to comply with the
adopted rules. However, the transparent pricing requirements of the
``all-in'' rule will benefit competition for small and other video
programming providers by providing consumers with more clarity when
comparing costs for video programming services.
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\269\ See Television Viewer Protection Act of 2019, Public Law
116-94, 133 Stat. 2534 (2019), section 1004(b) (requiring a six
month implementation requirement).
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80. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered. The RFA requires an
agency to provide, ``a description of the steps the agency has taken to
minimize the significant economic impact on small entities . . .
including a statement of the factual, policy, and legal reasons for
selecting the alternative adopted in the final rule and why each one of
the other significant alternatives to the rule considered by the agency
which affect the impact on small entities was rejected.'' \270\
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\270\ 5 U.S.C. 604(a)(6).
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81. As explained in the Order, the ``all-in'' rule is necessary to
equip consumers to make informed decisions about their service and
comparison shop among video programming providers with clear, easy-to-
understand, and accurate information about the charges related to video
programming.\271\ This rule includes flexibility that should make it
easier for small and other entities to comply. For example, the
Commission does not limit compliance with the ``all-in'' rule to a
specific manner to disclose the aggregate price when charges for video
programming are part of a bundled service or when video programming is
marketed regionally or nationally, other than requiring a clear, easy-
to-understand, and accurate ``all-in'' price. We also considered
whether the ``all-in'' rule should differentiate between residential,
small business, and enterprise subscribers, and determined that it
should not apply to bulk purchasers of non-residential services or
enterprise customers because those are typically customized,
individually negotiated pricing plans. We believe the rule will protect
consumers from deceptive bills and advertising with minimized costs and
burdens on small and other entities. In the absence of evidence to the
contrary in the record, the Commission does not expect the adopted
requirements to have a significant economic impact on small entities.
Finally, we provide small cable operators, defined as those with annual
receipts of $47 million or less, with an additional three months to
come into compliance with the rule.
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\271\ Order at para. 6.
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82. Report to Congress. The Commission will send a copy of the
Order, including the FRFA, in a report to be sent to Congress pursuant
to the Congressional Review Act.\272\ In addition, the Commission will
send a copy of the Order, including this FRFA, to the Chief Counsel for
Advocacy of the SBA. The Order and FRFA (or summaries thereof) will
also be published in the Federal Register.\273\
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\272\ 5 U.S.C. 801(a)(1)(A).
\273\ Id. section 604(b).
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Ordering Clauses
83. Accordingly, it is ordered that, pursuant to the authority
found in sections 1, 4(i), 303, 316, 335(a), 632(b), and 642 of the
Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 303,
316, 335(a), 552(b), and 562, the Report and Order is adopted, and part
76 of the Commission's rules, 47 CFR part 76, is amended as set forth
in the Appendix of the Report and Order.
84. It is further ordered that the Report and Order shall be
effective thirty (30) days after the date of publication in the Federal
Register. Compliance with Sec. 76.310, 47 CFR 76.310, which may
contain new or modified information collection requirements, will not
be required until (i) nine months after the release of the Report and
Order or (ii) after the Office of Management and Budget completes
review of any information collection requirements that the Media Bureau
determines is required under the Paperwork Reduction Act, whichever is
later; with the exception of small cable operators, which will have (i)
twelve months after the release of the Report and Order or (ii) after
the Office of Management and Budget completes review of any information
collection requirements that the Media Bureau determines is required
under the Paperwork Reduction Act, whichever is later, to come into
compliance. The Commission directs the Media Bureau to announce the
compliance date for Sec. 76.310 by subsequent Public Notice and to
cause Sec. 76.310 to be revised accordingly. The Commission's rules
are hereby amended as set forth in the Appendix of the Report and
Order.
[[Page 28679]]
85. It is further ordered that the Commission's Office of the
Secretary shall send a copy of the Report and Order, including the
Final Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
86. It is further ordered that Office of the Managing Director,
Performance Program Management, shall send a copy of the Report and
Order in a report to be sent to Congress and the Government
Accountability Office pursuant to the Congressional Review Act, 5
U.S.C. 801(a)(1)(A).
List of Subjects in 47 CFR Part 76
Television.
Federal Communications Commission.
Marlene Dortch,
Secretary.
Final Rule
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR part 76 to read as follows:
PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE
0
1. The authority citation for part 76 is revised to read as follows:
Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303,
303a, 307, 308, 309, 312, 315, 317, 325, 335, 338, 339, 340, 341,
503, 521, 522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545,
548, 549, 552, 554, 556, 558, 560, 561, 562, 571, 572, 573.
0
2. Add Sec. 76.310 to read as follows:
Sec. 76.310 Truth in billing and advertising.
(a) Cable operators and direct broadcast satellite (DBS) providers
shall state an aggregate price for the video programming that they
provide as a clear, easy-to-understand, and accurate single line item
on subscribers' bills, including on bills for legacy or grandfathered
video programming service plans. If a price is introductory or limited
in time, cable and DBS providers shall state on subscribers' bills the
date the price ends, by disclosing either the length of time that a
discounted price will be charged or the date on which a time period
will end that will result in a price change for video programming, and
the post-promotion rate 60 and 30 days before the end of any
introductory period. Cable operators and DBS providers may complement
the aggregate line item with an itemized explanation of the elements
that compose that single line item.
(b) Cable operators and DBS providers that communicate a price for
video programming in promotional materials shall state the aggregate
price for the video programming in a clear, easy-to-understand, and
accurate manner. If part of the aggregate price for video programming
fluctuates based upon service location, then the provider must state
where and how consumers may obtain their subscriber-specific ``all-in''
price (for example, electronically or by contacting a customer service
or sales representative). If part or all of the aggregate price is
limited in time, then the provider must state the post-promotion rate,
as calculated at that time, and the duration of each rate that will be
charged. Cable operators and DBS providers may complement the aggregate
price with an itemized explanation of the elements that compose that
aggregate price. The requirement in this paragraph (b) shall not apply
to the marketing of legacy or grandfathered video programming service
plans that are no longer generally available to new customers. For
purposes of this section, the term ``promotional material'' includes
communications offering video programming to consumers such as
advertising and marketing.
(c) This section may contain information collection and/or
recordkeeping requirements. Compliance with this section will not be
required until this paragraph (c) is removed or contains compliance
dates. The Commission will publish a document in the Federal Register
announcing the compliance dates and revising or removing this paragraph
(c) accordingly.
[FR Doc. 2024-07404 Filed 4-18-24; 8:45 am]
BILLING CODE 6712-01-P