FCC to Scrutinize Customer Service Practices in the Communications Sector

On October 23, the Federal Communications Commission (FCC or Commission) issued a Notification of investigation (NOI) focused on customer service for a wide range of communications companies, specifically selecting providers of voice, broadband, cable and direct broadcast satellite (DBS) services. The purpose of the NOI is to assess whether customers “have appropriate access to the customer service resources they need to communicate with their service provider in a way that allows them to resolve problems efficiently, avoid unnecessary costs and make informed choices with regard to the services they obtain from these service providers.” The NOI is also exploring potential regulatory approaches, including with respect to service cancellations, service installations and outages, automatic service renewals, the use of artificial intelligence (AI), and customer service practices for individuals with disabilities and customers who use English as a second language to have. other things. During the NOI, the Commission asks detailed questions about current customer service practices and the impact of potential new requirements, including the potential impact on privacy. The Commission approved the NOI on a 3-2 party vote, with Commissioner Brendan Carr issuing a dissenting statement questioning the FCC’s authority to regulate customer service standards for the industry.

This NOI is part of broader initiatives to address both customer service and AI issues within the federal government, and while not limited to AI, it represents the Commission’s latest action to explore AI technologies in the communications sector . This NOI represents the first phase of the FCC’s potential regulatory activity in this area, and the impact of potential new customer service rules could be significant for a range of providers in the communications industry. Responses to the NOI are due on November 22nd and responses to the NOI are due on December 9th.

Below we summarize the Commission’s extensive investigation into customer service practices in the communications sector and analyze how it fits into the government’s broader efforts.

The NOI asks about available cancellation methods, access to live customer service agents, and the prevalence of automatic renewals in the communications industry.

Service cancellation. Noting that “service providers often make it easy to sign up for a service, but limit subscribers’ ability to cancel that same service,” the NOI questions whether service providers should either offer more than one service cancellation mechanism, or must offer “that reflect any service”. available method that consumers can use to subscribe to the service.” The NOI questions whether service providers must allow customers to cancel “in all cases” on the service provider’s website, and whether service providers “clearly and conspicuously disclose” how to cancel subscription services at the point of sale and at account statements. The NOI also questions whether the process of returning rental equipment as part of a cancellation “should be subject to similar disclosure standards.”

The NOI separately asks about privacy issues that may arise in the service cancellation process, including whether providers’ collection of information for cancellation (for example, the reasons for cancellation) imposes privacy obligations on telecommunications carriers, DBS providers or cable operators under the Communications Act. .

Access to live representatives. The NOI notes that consumers are “understandably frustrated” when they are unable to speak to a live representative to resolve a service issue, and asks for comment on “whether service providers provide live telephone support within a reasonable timeframe of customer service representatives.” The NOI also questions whether cable operators are meeting their customer service obligations under the FCC’s current rules, and whether such rules should be expanded to apply to other communications providers. The NOI separately asks about other possible regulatory solutions, including identifying a “reasonable amount of time” in which a customer must be connected to a live representative, and requiring providers to allow customers to dial “0” to speak with a live representative.

In addition, the NOI would like to comment on potential privacy issues related to any updated customer service requirements, such as recording customer interactions, and whether customers should be notified if recorded interactions are used to train AI systems. Relatedly, the NOI would like to comment on the extent to which emerging AI technologies “would impact the requirement that service providers provide live customer service support.”

Automatic renewals. The NOI states that service providers “often advertise discounted trial or promotional periods to entice consumers to subscribe to their services without clearly disclosing future price increases or automatic renewal of such services unless the subscriber has taken an affirmative action,” and questions whether the FCC should require that consumers be given notice and a reasonable opportunity to terminate a service before incurring new or increased charges. The NOI also seeks comment on several aspects of automatic renewal processes that do not require further authorization and are offered on trial or promotional subscriptions, including whether there are any benefits associated with automatic renewal programs.

The NOI is seeking comment on additional ways to improve the customer experience.

The NOI questions whether the FCC should update or strengthen its existing standards for installations, outages, and service calls from cable operators. The NOI also requests comment on whether providers should be required to credit a consumer’s account if the provider fails to keep a scheduled service appointment without notice, and whether providers should be required to offer service appointments outside of regular business hours. In addition, the NOI asks about common practices for service installations, outages and calls in the communications industry.

The NOI also takes into account the customer service experience for customers with disabilities. Recognizing that the Commission’s accessibility rules, including customer service obligations, apply to telecommunications carriers, advanced telecommunications providers, and equipment manufacturers, the NOI requests comment on “the state of accessible customer service” generally. The NOI again asks about a possible ‘0’ rule for reaching a live agent, and whether the FCC should require providers to implement alternatives for customers who cannot dial ‘0’ due to a disability. In addition, the NOI wishes to comment on how the issues raised in the NOI impact English as a second language consumer, and whether there are any considerations that the FCC has not included.

Finally, the NOI asks a number of questions specific to the cable industry, including whether the Commission should accept requests for potential new rules in this area.

The NOI is part of a broader federal effort to address both customer service practices and AI issues.

The FCC’s NOI is consistent with broader efforts by the Biden administration to address perceived customer service issues across all industry sectors. For example, in September 2022, the government announced an initiative to tackle so-called ‘junk fees’, triggering a number of procedures in the federal government, including the Consumer Financial Protection Bureau, Federal Trade Commission (FTC)And FCC. And this NOI comes just over two months after the Biden administration launched the initiative Time is money initiativewhich is “a new government-wide effort” to tackle perceived “unfair” customer service practices across the economy. As part of this effort, the FTC recently completed the click-to-cancel rule that governs both the sign-up and cancellation processes for subscriptions or other recurring charges, including the requirement that companies make canceling as easy as signing up. These new requirements apply to communications companies to the extent they provide non-common carrier services, raising questions about how the FTC’s new regime may interact with any rules ultimately adopted by the FCC in this proceeding; Indeed, these concerns led Commissioner Carr to argue in a dissent that “much of what the FCC considers here would better fit within the scope of the (FTC’s) jurisdiction.”

The NOI also aligns with the federal government’s efforts to address concerns surrounding the increased use of AI. Following President Biden’s October 2023 AI Executive Orderthe FCC has been actively exploring ways to address the risks and benefits of AI. For example, the FCC is focused on the intersection of robocalls and AI and has taken a number of actions in this area, including issuing a NOI in November 2023 that sought information on the implications of emerging AI technologies for calling and texting; issuing one Explanatory statement confirmed in February this year that calls using AI to generate voices are artificial or pre-recorded voice calls under the TCPA and must therefore comply with the rules governing such calls; and hiring A Notice of Proposed Rulemaking and NOI which last month proposed, among other things, new rules to regulate AI-generated calls and text messages. In the broadcasting context, the FCC initiated a regulatory procedure to investigate whether the agency should require broadcasters and programming entities to disclose the use of AI-generated content in political advertisements on TV and radio. And the FCC has one too NOI seeking input on leveraging new technologies, including through machine learning (ML) and AI, to collect and analyze data on non-federal spectrum use. In short, the FCC – in line with other agencies within the federal government – has taken an active interest in emerging AI issues, including with this latest NOI asking questions about the use of AI in customer service practices in the communications industry.

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