The FCC has imposed nutrition labels for telecoms services. Italy’s experience suggests they have not been a silver bullet to improving transparency and fairness for consumers
Telcos must now display labels on broadband services: On 17 November 2022, the Federal Communications Commission (FCC) published new rules that will for the first time require US telcos to display easy-to-understand labels to allow consumers to better compare fixed and mobile broadband services. The FCC’s Report and Order means that operators must present, at the point of sale, labels that show information typically important to end users, including prices, speeds, data allowances and other terms of service. In order to empower consumers effectively, the labels have been designed to resemble the well-known nutrition information that has appeared on food products in the US for over 25 years. The Report and Order also includes a template of the required label that reflects input from end users, consumer bodies and other industry stakeholders that participated in three public hearings and/or responded to a FCC consultation.
A move to enable meaningful comparisons of operators and tariffs: Consumers need accurate information on what they are paying for. The new labels aim to empower them with several features:
Prominent display: Broadband providers must display the label – not simply an icon or link to the label – in close proximity to the advertisement of a given plan;
Account portals: Telcos make each customer’s label easily accessible in their online account portal and available upon request;
Machine readability: Operators must make the information in the labels machine-readable to enable third parties to more easily collect and aggregate data for the purpose of creating comparison-shopping tools for consumers; and
Further refinements: The FCC has adopted a Further Notice of Proposed Rulemaking on ways that it can improve its rules in future.
Italy’s labelling system has led to confusion among some consumers: The FCC’s mandated nutrition labels are based on the voluntary industry-led approach it approved in 2016 and are intended to help consumers make informed decisions and contribute to a well-functioning telecoms market. While such measures are useful, it is likely they will not be enough in isolation to overcome long-standing choice and affordability challenges in the US, where the vast majority of households do not have more than two options of broadband provider. Even in countries with greater retail competition, nutrition labels have not been a silver bullet to improving transparency and fairness for end users. In Italy, for instance, the terminology employed by operators in response to AGCOM’s ‘traffic light’ system for fixed broadband has led to some customer confusion around the technologies and speeds available at their premises.
Source: https://www.fcc.gov/document/fcc-requires-broadband-providers-display-labels-help-consumers-0
