FCC Exempts Small Broadband Companies From Net Neutrality Reporting Requirements

The Federal Communications Commission adopted an order Thursday to exempt small broadband providers from the reporting requirements set in place by net neutrality.

Internet service providers with fewer than 250,000 customers no longer have to disclose information on network performance, fees, and data caps. The FCC found that these companies would be negatively affected by these requirements given that they frequently serve rural areas that lack competitive alternatives to broadband service.

The order passed 2-1 with Chairman Ajit Pai and Commissioner Michael O’Rielly voting in favor and Commissioner Mignon Clyburn opposing.

This decision is one of the first steps in Pai’s promise to dismantle net neutrality rules since taking over as chairman.

Last year, the FCC voted on a provision that would exempt Internet service providers with 100,000 subscribers or fewer from these reporting requirements. That version of the provision had bipartisan support. Clyburn said that by raising the number of subscribers, the FCC is allowing big companies to exempt their subsidiaries from reporting on information that helps customers decide what service to buy.

“And if all of that were not enough, the order runs roughshod over past precedent, with no discussion as to why the commission is changing its mind,” Clyburn said. “Twice, the commission found 100,000 connections to be the right number, but today you will not find any rational discussion as to why this cutoff has been revisited.”

Pai said that the latest exemption remained consistent with the bipartisan compromise voted on two months ago, despite Clyburn’s claims that the raised numbers reflect a “vastly different order than what had been on circulation for several months.”

Pai said that the reporting exemption will help small companies expand broadband service in rural areas.

“We are taking action to exempt small businesses from these burdensome requirements—requirements that impose serious and unnecessary costs on small providers,” Pai said.

Clyburn said that if the FCC were to conduct an analysis on the reporting requirements on companies with 250,000 subscribers, it would find that the regulations are not “burdensome.” The Office of Management and Budget found that under the new transparency rules, it would take each broadband provider 6.8 hours annually to adhere to the reporting requirements, according to Clyburn.

“These rules were adopted to prevent broadband providers from blocking, throttling, favoring or discriminating against traffic, or extracting tolls from any user, for any reason, or for no reason at all,” said Clyburn. “And at a time when the majority on this commission is talking about gutting these broader rules, I cannot in good conscience support this vastly increased exemption without knowing what core protections will remain in place for consumers and small businesses in the years to come.”

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