Last week, the FCC announced that it will conduct a public demonstration of the expanded Online Public Inspection File system.  The demonstration will take place on Monday, June 13 at 1 p.m. EDT in the FCC Meeting Room at FCC Headquarters, 445 12th Street, S.W., Washington, D.C. 20554.  The demonstration will inform users of the design, layout, and content of the new public inspection file site, discuss how to upload information and files, and present new functionalities of the site.  

The demonstration will also be streamed online.  The link for viewing the webinar is available on the FCC’s online inspection file webpage.

As a reminder, beginning June 24, 2016, all cable systems with 1,000 or more subscribers must place their new public inspection file documents in the FCC-hosted online public file database.  Existing public file documents must be uploaded into the FCC-hosted database by December 24, 2016 (subject to certain exemptions).

Cable operators may continue to access a test version of the FCC-hosted online public file database to practice uploading documents and to gain familiarity with the database's other features.  The test version is for practice purposes only and all documents uploaded will be deleted once the actual database goes live on June 24, 2016.   

If you have questions about the cable public file rules or the requirement to post them online, please contact Scott Friedman at (312) 372-3930 or sfriedman@cinnamonmueller.com. 

FCC Releases New Guidance on Compliance with Enhanced

Open Internet Transparency Requirements 

            On May 19, 2016, the FCC’s Chief Technologist, Office of General Counsel and Enforcement Bureau (collectively, the “Bureaus”) released a Public Notice offering new guidance regarding acceptable methodologies for disclosure of network performance metrics to satisfy the enhanced transparency requirements adopted by the FCC in its 2015 Open Internet Order, as well as compliance with the point of sale disclosure requirement.

Background.  The FCC’s Transparency Rule, which has been in effect since November 20, 2011, requires fixed and mobile broadband Internet access service (“BIAS”) providers to publicly disclose accurate information regarding network management practices, performance, and commercial terms, including privacy policies.  BIAS providers must disclose to current and potential subscriber information about network management practices, performance characteristics, and commercial terms of their BIAS services.  These disclosures must be sufficiently detailed to allow consumers “to make informed choices regarding use of such services and for content, application, service, and device providers to develop, market, and maintain Internet offerings.”

In its 2015 Open Internet Order, the FCC provided clarifications concerning compliance with the Transparency Rule, and adopted certain transparency enhancements, including new categories of information to be disclosed.  By their terms, the enhancements currently apply only to BIAS providers serving 100,000 or more broadband connections; providers under that level are temporarily exempt until December 15, 2016.  The FCC is currently evaluating the compliance burdens associated with the enhanced transparency requirements for purposes of determining whether to retain the temporary exemption from the enhancements for small providers, and in advocating that the new rules should be approved by the federal Office of Management and Budget (“OMB”) so they may take effect for larger providers.  The new guidance addresses some of the questions raised by the transparency enhancements and provides useful suggestions to assist providers in formulating their disclosures.

Prior Guidance.  The FCC has previously provided advisory guidance to BIAS providers on how they can meet their disclosure obligations under the Transparency Rule.  In particular, this includes the release of Advisory Guidance from the Enforcement Bureau and Office of General Counsel in 2011, an Enforcement Advisory in 2014, and a recently released Open Internet Small Entity Compliance Guide.  While these releases are not binding on the FCC, they do offer authoritative guidance on acceptable disclosure practices.

New Guidance.  The Public Notice provides guidance on the disclosure of the enhanced network performance requirements and point of sale requirements. 

Network Performance Metrics.

Service Tiers.  BIAS providers must furnish a separate disclosure for each technology and each service tier offered to customers.

Actual Network Performance Metrics.  The 2015 Open Internet Order enhanced the requirement that all BIAS providers disclose both expected and actual download and upload speeds and latency for each service by also requiring disclosure of expected and actual packet loss.  The Public Notice gives new guidance on the disclosure of actual network performance metrics:

• Speed – BIAS providers may comply with the requirement to disclose actual speeds (both download and upload) by disclosing either (i) the median speed or (ii) a range of actual speeds that includes the median speed (e.g., 25th to 75th percentile)
• Packet Loss – BIAS providers may disclose the “average” packet loss; however, the Public Notice does not identify suggested periods or methods to measure such loss.
• Actual/Expected Performance – The Public Notice advises BIAS providers that in order to ensure that the actual and expected network performance metrics can be compared, it is best to provide actual and expected performance in comparable formats, with an example that “if actual download speed is provided as a range, the expected download speed should use a range with the same percentile endpoints.”

Geographic Granularity. The 2015 Open Internet Order requires that disclosures of actual speed, latency and packet loss “be reasonably related to the performance the consumer would likely experience in the geographic area in which the consumer is purchasing service.”  The Public Notice clarifies that fixed BIAS providers may meet this requirement by disclosing actual performance metrics for each “operational area” – each geographic area in which the service has a distinctive set of network performance metrics (the Public Notice recognizes that most fixed BIAS providers will have a single operational area for each broadband service offered). 

Disclosure of Expected Network Performance Metrics.  There is no corresponding requirement to disclose different expected network performance metrics in different geographic areas.  However, “to ensure that information regarding performance is accurate and sufficient for consumers to make informed choices, expected network performance disclosed for a geographic area should not exceed actual network performance in that geographic area.”

Peak Usage Periods.  The 2015 Open Internet Order stated the FCC’s expectation that network performance would be measured “during times of peak usage.”  The Public Notice clarifies that peak usage periods may be based solely on the local time zone and that BIAS providers retain flexibility to determine the appropriate peak usage periods for their network performance metrics.

Guidance for Providers Relying Upon MBA Safe Harbor

Fixed BIAS Network Performance.  The Public Notice confirms that participation in the Measuring Broadband America (“MBA”) program remains a safe harbor for fixed BIAS providers in meeting the requirement to disclose actual network performance.  Accordingly, fixed BIAS providers that participate may disclose their results from the MBA program, for each service for which the program provides network performance metrics, as a sufficient representation of actual download and upload speeds, actual latency, and actual packet loss of those services.

Guidance for Providers Not Using MBA Safe Harbor

Fixed BIAS Network Performance.  As articulated in the 2011 Advisory Guidance, fixed BIAS providers not using the MBA safe harbor may disclose actual network performance metrics based on the MBA methodology, “internal testing; consumer speed test data; or other data regarding network performance, including reliable, relevant data from third-party sources.”  In the 2015 Open Internet Order, the FCC explained that disclosed actual network performance metrics should be based on measurements during peak usage periods.  It also explained that any of these methodologies may be used as the basis for measurement of actual download and upload speeds, actual latency, and actual packet loss, provided that the methodology be disclosed and be grounded in commonly accepted principles of scientific research, good engineering practices, and transparency. 

Routes.  The Transparency Rule requires BIAS providers to disclose “accurate information regarding the network management practices, performance, and commercial terms of its broadband Internet access services sufficient for consumers to make informed choices regarding use of such services and for content, application, service, and device providers to develop, market, and maintain Internet offerings.”  The routes over which network performance metrics are measured should thus be chosen to accurately represent the actual network performance experienced by consumers within the designated geographic area.  The 2010 Open Internet Order noted that the FCC’s “rules apply only as far as the limits of a broadband provider’s control over the transmission of data to or from its broadband customers.”  The 2015 Open Internet Order noted that “congestion may originate beyond the broadband provider’s network and the limitations of a broadband provider’s knowledge of some of these performance [metrics].”  The Public Notice explains, therefore, that a sufficient representation of actual network performance of the service may be obtained from measurements of speed, latency, and packet loss on a representative sampling of routes between end users and the points of interconnection with edge providers or other networks.  Fixed BIAS providers may, for example, measure speed, latency, and packet loss between measurement clients in broadband modems and measurement servers that are located in close proximity to the links on which traffic is exchanged with edge providers or other networks.  As an alternative to placing measurement clients in broadband modems, a fixed BIAS provider may place measurement clients in access networks, provided that this internal testing accurately measures performance metrics in a manner that represents the performance experienced by consumers of the service.

The key point is that the network performance metrics disclosed be based on measurements taken by the provider during peak usage periods; it is not sufficient to simply reference data from third-party sources.

Point of Sale Requirements

Website Disclosures.  The Transparency Rule requires BIAS providers to disclose network management practices, performance characteristics, and commercial terms “at the point of sale.”  The Public Notice clarifies that despite certain language in the 2015 Open Internet Order suggesting otherwise, the order did not modify the existing point-of-sale requirement.  BIAS providers are not required to provide hard copies of the disclosures required under the Transparency Rule at the point of sale and instead may direct consumers to links to online disclosures so long as consumers actually receive the information necessary to make informed decisions prior to making a final purchasing decision at all potential points of sale, including in a store, over the phone, and online.

Consumer Disclosure Safe Harbor.  In the 2015 Open Internet Order, the FCC determined that there should be a voluntary safe harbor for the format and nature of the disclosures to consumers required under the Transparency Rule. To take advantage of the safe harbor, a BIAS provider must provide a consumer-focused, standalone disclosure, the recently-adopted "nutrition label" disclosure forms.  BIAS providers that wish to qualify for the consumer safe harbor must use these forms at the point of sale, including retail outlets.  BIAS providers choosing to use the “nutrition label” for their consumer disclosures will also need to have a separate set of disclosures aimed at providing edge providers the categories of information required to be disclosed.

Although the enhancements to the Transparency Rule are not yet in effect for any providers and small providers are temporarily exempt pending further FCC action, the new guidance provides useful information for formulating an approach to the disclosures that will be compliant.  All providers are reminded to have their disclosures prominently displayed on their websites and to keep accurate by periodically reviewing and updating the disclosed information.

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