On Friday, President Biden urged the Federal Communications Commission to restore net neutrality rules and take steps to boost price transparency and competition in broadband—but the FCC can't do most or all of that yet, because Biden hasn't nominated a fifth commissioner to break the 2-2 deadlock between Democrats and Republicans.
Consumer advocacy groups have been urging Biden to nominate a third Democrat to the deadlocked FCC for months, but he still hasn't done so. What's causing the holdup isn't clear. The delay could wipe out the FCC's ability to do anything opposed by Republicans for all of 2021, because it can take the Senate months to approve FCC nominations, and the FCC process for complicated rulemakings is also lengthy.
Friday, Biden released a fact sheet describing an executive order focused on boosting competition in numerous industries. The order targets four broadband problems that it "encourages" the FCC to solve: deals between ISPs and landlords that limit tenants' choices; misleading advertised prices; high termination fees; and net neutrality. (We published a separate article Friday on how other parts of the executive order affect the tech industry.)
"The order tackles four issues that limit competition, raise prices, and reduce choices for internet service," the Biden fact sheet's broadband section said. "More than 200 million US residents live in an area with only one or two reliable high-speed internet providers, leading to prices as much as five times higher in these markets than in markets with more options. A related problem is landlords and internet service providers entering exclusivity deals or collusive arrangements that leave tenants with only one option. This impacts low-income and marginalized neighborhoods, because landlord–ISP arrangements can effectively block out broadband infrastructure expansion by new providers."
Biden's order encourages the FCC to "prevent ISPs from making deals with landlords that limit tenants' choices." The FCC technically bans exclusive agreements for TV and telecom services in multi-unit buildings but hasn't stamped out the problem.
Biden Targets Hidden Fees and Switching Costs
The next part of Biden's fact sheet covers the misleading advertised prices used by ISPs to hide the true cost of service. "Even where consumers have options, comparison shopping is hard. According to the FCC, actual prices paid for broadband services can be 40 percent higher than advertised," the fact sheet said.
Biden's proposed solution is to bring back the Obama-era "nutrition labels" that were designed to give customers information about hidden fees, data caps, overage charges, speed, latency, packet loss, and so on. Biden's fact sheet said the executive order "encourages the FCC to revive the 'Broadband Nutrition Label' and require providers to report prices and subscription rates to the FCC."
Biden further asks the FCC to "limit excessive early termination fees," because customers in areas with competition "may be unable to actually switch because of high early termination fees—on average nearly $200—charged by internet providers."
Restoring Net Neutrality Rules
Finally, Biden encouraged the FCC to "restore net neutrality rules undone by the prior administration." Without the Obama-era net neutrality rules, "big providers can use their power to discriminatorily block or slow down online services," Biden wrote.
ISPs do have to follow net neutrality rules in California and Washington state because of state laws and may do so in other states for the sake of simplicity in network operations and because they don't want to give the government more incentive to impose stronger regulations while the long-term status of net neutrality is unsettled. Reviving the FCC's Obama-era net neutrality rules would likely involve reclassifying broadband providers as common carriers under Title II of the Communications Act again to establish a nationwide framework for protecting net neutrality.