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Broadband and television providers may continue to charge “rental” fees for equipment that customers own until December 2020, thanks to a Federal Communications Commission decision that delays the implementation of ‘a new law.
A law approved by Congress and signed by President Trump in December 2019 prohibits suppliers from charging device rental fees when customers use their own equipment, and it was originally scheduled to take effect on June 20. As we have written, this law will help border customers who have been forced to pay monthly fees of $ 10 for equipment they do not use and, in some cases, never even received it. But the law gave the FCC discretion to extend the six-month period if the board “finds there are good reasons for such an additional extension,” and the FCC has done just that.
the FCC Decision of April 3, which we hadn’t noticed at the time, extends the deadline until December 20 and says that suppliers need more time to comply because of the coronavirus pandemic:
As the country tackles the COVID-19 pandemic, multi-channel video program distributors (MVPD) and fixed broadband Internet service providers are among the entities that are an integral part of the national effort underway to keep Americans informed and connected during this national emergency. In order for these service providers to focus their resources on this critical effort, we provide appropriate flexibility to MVPDs and fixed broadband Internet access service providers to fulfill their obligations under the Viewers Protection Act. television of 2019 (TVPA) … we find that there is good reason to grant a general extension of the date of coming into force of section 642 until December 20, 2020.
The new law, the FCC noted, “prohibits MVPDs and fixed broadband Internet service providers from charging consumers for equipment they do not provide.” Compliance with the rental fee provision and other billing transparency requirements in the new law “may require reporting entities to make changes to existing billing systems, provide training to employees, or take other compliance measures, forcing suppliers to divert resources from other consumers – demands caused by the pandemic, “said the FCC.
Frontier continues to charge rental fees
Frontier claimed last year that it charges rental fees to cover the higher support costs for customers who use their own routers, but the company also said it “could not support or repair non-Frontier hardware. ” Frontier is taking advantage of the additional six months and will continue to charge rental fees to customers who use their own equipment. A Frontier spokesperson told Ars today that the company “plans to comply with the requirements when the law comes into force” – in December. Unlike Frontier, other large ISPs generally allow customers to avoid rental fees when using their own routers.
Frontier Florida customer John emailed Ars this week after asking Frontier if the company would stop charging fees in June. We have agreed to publish only the first names of John and another client listed later in this article. John said:
I called the Frontier Florida customer service office yesterday to request the procedure for returning the Frontier router in preparation for the coming into force of the new law, and the representative said that I would still be charged for the rental because, I quote, “Frontier requested a 6 month Extension of the January decision and it was approved. Therefore, you will continue to be billed the $ 10 / month until December . “
The Frontier spokesperson told Ars that the company “had not requested an exemption”, although a trade group representing Frontier had requested an industry-wide exemption. In any event, it is disappointing for customers that the FCC grants the exemption and that Frontier benefits from it.
“You and I both know that this has more to do with revenue retention than with a supplier’s ability to” comply “with the new law due to COVID-19,” John told Ars .
“Given Frontier’s recent bankruptcy, I am not surprised that they continue to stick to their customers,” said John. “Conclusion: do not advertise the service in large print as a service at $ 39.99 / month if it is obligatory you pay their rental fees of $ 10 / month. “
Other clients are a little luckier
We also heard from a client in Oregon, one of the four states where Frontier recently sold its network to a company doing Ziply fiber. Oregon customer Phillip said Ziply agreed to withdraw the $ 10 router rental fee from his bill, but not immediately. Phillip bought his own router and returned the one provided by the company to Ziply. But Ziply continued to put $ 10 on his bills.
Phillip spoke to a customer service representative who attempted to waive the router charges, “but the system wouldn’t let him,” Phillip told us. Phillip says he then spoke to a supervisor and pointed to the new US law prohibiting these charges.
“I quoted your article and the law to the supervisor and she said they would issue a ticket to the appropriate team to update the software so they can actually remove the equipment,” Phillip told us in an email. “She then told me that it would take about 2 invoices for this and … she said that I should call each time I received an invoice with the fees indicated to withdraw it manually.”
Rich Son, a Frontier customer in Texas about whom we wrote last year, told us today that “Frontier sneaked my account charges” about a month after this story was published. But while other Frontier customers are still facing charges, Son told Ars: “It’s hard for me to believe that deleting a line item would take six months, pandemic or not.”
FCC agrees with industry lobbyists
Despite the use of COVID-19 as a cover to force customers to continue to pay fees for non-existent equipment, the FCC urged ISPs to voluntarily waive late fees and not to disconnect customers who cannot pay due to the pandemic. Of course, saving customers money by eliminating unnecessary rental fees would also help those in trouble during the pandemic, but the FCC order granting the extension did not mention this.
The FCC granted the extension after being urged to do so by three major cable and telecommunications groups. One such group is USTelecom, of which Frontier is a member. The groups said they plan to ask for the extension before the pandemic even shuts down much of the US economy. Trade groups told the FCC on March 26:
In ordinary circumstances, the initial effective date of six months would not have given cable and other multichannel video program distributors (MVPD) enough time to comply with various provisions of the law, and an extension until December 20, 2020 would be justified for this reason alone. The COVID-19 pandemic has now made compliance with the effective date of June 20, 2020 practically impossible, since the resources formerly deemed available for this purpose must now be redirected to meet the needs of customers affected by the virus. Indeed, the persistent crisis can compromise respect even if an extension of six months is granted.
The pandemic consumes resources available to our members in all divisions of their business, including the teams that provide production, development and customer support for the implementation of TVPA. For example, an immediate impact of COVID-19 is the reduction in the capacity of member customer call centers. Having to create new scripts, organize training and learn new routines around the new TVPA requirements would be an additional burden at a time when members’ resources for customer service are already limited. In addition, as call center operations are disrupted, members are working to develop more online self-care resources and functions, which requires significant development work.
In addition to the equipment rental provision, the new law includes several provisions that should make it more difficult for providers to deceive customers about prices. For example, a new right to transparency requires television and broadband companies to provide customers with total monthly fees, including all fees charged by the company and a bona fide estimate of all fees and taxes imposed by government, before clients enter into a contract. This notice must also specify the amount of promotional discounts and the expiration date of these discounts. When it finally comes into force, the law is supposed to give consumers 24 hours to cancel without penalty after entering into a contract.