1. 1 Federal Communications Commission 2010 National Association of State Utility Consumer Advocates Mid-Year Meeting Marriott San Francisco Fishermans Wharf San Francisco, California June 14, 2010 Joel Gurin, Chief Consumer and Governmental Affairs Bureau

2. 2 FCC Mission and Goals Independent federal agency charged with regulating interstate and international communications by radio, radio, television, wire, satellite and cableIndependent federal agency charged with regulating interstate and international communications by radio, radio, television, wire, satellite and cable Strategic Goals for 2010 and BeyondStrategic Goals for 2010 and Beyond BroadbandBroadband ConsumersConsumers Competition and InnovationCompetition and Innovation Continual ImprovementContinual Improvement Public Safety and Homeland SecurityPublic Safety and Homeland Security InternationalInternational

3. 3 The Consumer & Governmental Affairs Bureau: Who are we? Mission: To serve as the public face of the Commission for the American consumer.Mission: To serve as the public face of the Commission for the American consumer. RolesRoles Educate and inform consumers about telecommunications goods and servicesEducate and inform consumers about telecommunications goods and services Develop and implement the Commissions consumer policiesDevelop and implement the Commissions consumer policies Develop and maintain partnerships with consumer and industry groups and federal, tribal, state and local government entities regarding telecommunications policy issuesDevelop and maintain partnerships with consumer and industry groups and federal, tribal, state and local government entities regarding telecommunications policy issues

4. 4 Guiding Principles for CGB Efforts Promote and facilitate the FCCs work to protect consumers through -- InformationInformation Transparency and DisclosureTransparency and Disclosure OutreachOutreach

5. 5 Cramming Cramming refers to the inclusion of unauthorized charges on a consumers telephone bill.Cramming refers to the inclusion of unauthorized charges on a consumers telephone bill. Two potential originating sources for unauthorized chargesTwo potential originating sources for unauthorized charges Consumers own telephone companyConsumers own telephone company Third party vendorThird party vendor

6. 6 Cramming Impact on Consumers A consequence of cramming is that a consumer is billed, and often pays, for unauthorized charges Some consumers may continue to be crammed over an extensive period of time Each complaint represents potentially hundreds or thousands of other consumers who may not recognize that they have been crammed for similar charges.

7. 7 Cramming Best Practices Guidelines to Protect Consumers from Cramming Bills should be comprehensible, complete and include information the consumer may need to discuss and, if necessary, dispute charges.Bills should be comprehensible, complete and include information the consumer may need to discuss and, if necessary, dispute charges. Consumers should be provided with options to control whether or not a third partys products and services are charged on their telephone bills.Consumers should be provided with options to control whether or not a third partys products and services are charged on their telephone bills. Consumer authorization of services ordered should be appropriately verified.Consumer authorization of services ordered should be appropriately verified.

8. 8 Cramming Best Practices Guidelines to Protect Consumers from Cramming (contd) Local exchange carriers (LECs) should screen products, services, and third party service providers prior to approval for inclusion on the telephone bill.Local exchange carriers (LECs) should screen products, services, and third party service providers prior to approval for inclusion on the telephone bill. Clearinghouses that aggregate billing for third party customers and submit that billing to LECs should ensure that only charges that have been authorized by the customer will be included.Clearinghouses that aggregate billing for third party customers and submit that billing to LECs should ensure that only charges that have been authorized by the customer will be included.

9. 9 Cramming Best Practices Guidelines to Protect Consumers from Cramming (contd) LECs should continue to educate consumers as to their rights and the process for resolution of disputes.LECs should continue to educate consumers as to their rights and the process for resolution of disputes. Each LEC should provide appropriate law enforcement, regulatory agencies, and other LECs with various categories of data to assist in controlling cramming.Each LEC should provide appropriate law enforcement, regulatory agencies, and other LECs with various categories of data to assist in controlling cramming.

10. 10 Cramming: Overview of Federal Regulatory Landscape 1.Truth-in-Billing Rules and Decisions 2.Consumer Information and Disclosure NOI

11. 11 Truth-in-Billing Rules and Decisions Overview of the Truth-in-Billing Orders First Truth-in-Billing Order [Truth-in-Billing and Billing Format, First Report and Order and Further Notice of Proposed Rulemaking, CC Docket No. 98-170, 14 FCC Rcd 7492 (1999)] Truth-in-billing principles (codified at section 64.2401 of the Commissions rules) require that consumer bills:Truth-in-billing principles (codified at section 64.2401 of the Commissions rules) require that consumer bills: be clearly organized, clearly identify the service provider, and highlight any new providers;be clearly organized, clearly identify the service provider, and highlight any new providers; contain full and non-misleading descriptions of charges that appear therein; andcontain full and non-misleading descriptions of charges that appear therein; and contain clear and conspicuous disclosure of any information the consumer may need to make inquiries about, or to contest charges on the bill.contain clear and conspicuous disclosure of any information the consumer may need to make inquiries about, or to contest charges on the bill.

12. 12 Truth-in-Billing Rules and Decisions Overview of the Truth-in-Billing Orders (contd) Second Truth-in-Billing Order [Truth-in-Billing Format; National Association of State Utility Consumer Advocates Petition for Declaratory Ruling Regarding Truth-in-Billing, CC Docket No. 98-170, CG Docket No. 04-208, Second Report and Order, Declaratory Ruling, and Second Further Notice of Proposed Rulemaking, 20 FCC Rcd 6448 (2005)] Applied requirement that billing descriptions be brief, clear, non- misleading and in plain language to Commercial Mobile Radio Service (CMRS) carriersApplied requirement that billing descriptions be brief, clear, non- misleading and in plain language to Commercial Mobile Radio Service (CMRS) carriers Proposed additional measures to provide consumers with clear information on their bills because there was still consumer confusion about their bills.Proposed additional measures to provide consumers with clear information on their bills because there was still consumer confusion about their bills.

13. 13 Consumer Information and Disclosure NOI Notice of Inquiry (CG Docket No. 09-158; CC Docket No. 98-170; WC Docket No. 04-36) Goal: Identify opportunities to protect and empower American consumers by ensuring sufficient access to relevant information about communications services.Goal: Identify opportunities to protect and empower American consumers by ensuring sufficient access to relevant information about communications services.

14. 14 Consumer Information and Disclosure NOI Underlying Reasons for Proceeding Evolution of communications marketplace -- new categories of services and new pricing plansEvolution of communications marketplace -- new categories of services and new pricing plans Continued consumer confusion regarding bills for communications servicesContinued consumer confusion regarding bills for communications services New opportunities to improve the kind and degree of information available to consumers presented by technology advancementsNew opportunities to improve the kind and degree of information available to consumers presented by technology advancements Desire to build a factual record whether pro-consumer goals can be accomplished through policies addressing information disclosureDesire to build a factual record whether pro-consumer goals can be accomplished through policies addressing information disclosure

15. 15 Consumer Information and Disclosure NOI Importance of Consumer Access to Accurate Information Serves critical function in maintaining a well-functioning marketplace that encourages competition, innovation, low prices and high quality servicesServes critical function in maintaining a well-functioning marketplace that encourages competition, innovation, low prices and high quality services Empowers consumers by allowing them to choose services best aligned with their needs and budgetsEmpowers consumers by allowing them to choose services best aligned with their needs and budgets Protects consumers from unanticipated charges and helps them identify and avoid products and services that fall short of their expectationsProtects consumers from unanticipated charges and helps them identify and avoid products and services that fall short of their expectations

16. 16 Consumer Information and Disclosure NOI Overview of Issues Addressed Whether existing truth-in-billing rules and/or consumer information- related rules should be applied to services other than wireline and wireless voice services (such as broadband Internet access service and subscription video services)Whether existing truth-in-billing rules and/or consumer information- related rules should be applied to services other than wireline and wireless voice services (such as broadband Internet access service and subscription video services) Whether consumers need information displayed in a consistent format that allows them to compare their current service with the new and increasing offerings of other providersWhether consumers need information displayed in a consistent format that allows them to compare their current service with the new and increasing offerings of other providers What type of information helps consumers assess the service quality being offered by each provider and the different dimensions of serviceWhat type of information helps consumers assess the service quality being offered by each provider and the different dimensions of service

17. 17 Consumer Information and Disclosure NOI Overview of Cramming Issues Addressed The Commission sought comment on the extent to which cramming remains a problem for consumers and why.The Commission sought comment on the extent to which cramming remains a problem for consumers and why. The Commission sought comment on what lessons it could learn from past experiences of other government agencies to deal with cramming, such as the Federal Trade Commission and state authorities.The Commission sought comment on what lessons it could learn from past experiences of other government agencies to deal with cramming, such as the Federal Trade Commission and state authorities.

18. 18 Consumer Information and Disclosure NOI Overview of Cramming Issues Addressed Data Request: Sought specific empiric and quantifiable information about the kinds of unauthorized charges that appear on consumers telephone bills, and how such charges are presented on the bill. Are the charges easily detected?Data Request: Sought specific empiric and quantifiable information about the kinds of unauthorized charges that appear on consumers telephone bills, and how such charges are presented on the bill. Are the charges easily detected? Industry Efforts: Expressed interest in data from industry about the complaints they receive from subscribers and what steps they have taken to address such unauthorized charges. Are there additional measures industry can or should take to reduce incidences of cramming, including a review of the anti-cramming best practices developed in 1998?Industry Efforts: Expressed interest in data from industry about the complaints they receive from subscribers and what steps they have taken to address such unauthorized charges. Are there additional measures industry can or should take to reduce incidences of cramming, including a review of the anti-cramming best practices developed in 1998? Billing Practices: Sought information on billing activities of CMRS carriers, including whether, and if so, how, they include charges for services rendered by third parties. The Commission sought comment on how providers currently present consumer information and on best practices for the display and formatting of consumer information.Billing Practices: Sought information on billing activities of CMRS carriers, including whether, and if so, how, they include charges for services rendered by third parties. The Commission sought comment on how providers currently present consumer information and on best practices for the display and formatting of consumer information.

19. 19 Consumer Information and Disclosure NOI What does the record received in response to the NOI tell us?

20. 20 Consumer Information and Disclosure NOI Snapshot of Government and Consumer Group Comments Require the billing carrier to offer customers the option to block third-party billing;Require the billing carrier to offer customers the option to block third-party billing; Require common carriers to undertake due diligence measures to screen third party service providers before permitting them to place charges on their telephone bill;Require common carriers to undertake due diligence measures to screen third party service providers before permitting them to place charges on their telephone bill; Enhance cooperation among law enforcement entities including sharing of complaints among state and federal regulators;Enhance cooperation among law enforcement entities including sharing of complaints among state and federal regulators;

21. 21 Consumer Information and Disclosure NOI Snapshot of Government and Consumer Group Comments (contd) Clarify that cramming includes not only unauthorized charges on LEC bills but also unauthorized charges that appear on other telephone bills; andClarify that cramming includes not only unauthorized charges on LEC bills but also unauthorized charges that appear on other telephone bills; and Require that third party billers be identified and provide their contact information on the telephone bill.Require that third party billers be identified and provide their contact information on the telephone bill.

22. 22 Consumer Information and Disclosure NOI Snapshot of Industry Comments Carriers are sufficiently motivated to protect their own subscribersCarriers are sufficiently motivated to protect their own subscribers Sufficient safeguards are currently in placeSufficient safeguards are currently in place Compliance with state and federal lawsCompliance with state and federal laws Corrective measures taken against problem billersCorrective measures taken against problem billers Pre-screening and monitoringPre-screening and monitoring Blocking optionsBlocking options Rapid resolution of complaintsRapid resolution of complaints

23. 23 Cramming The Road Ahead -- Whats Next?

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