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NCTA: FCC Needs To Rethink Net Neutrality Compliance Burden

The National Cable & Telecommunications Association has
told the FCC and the Office of Management and Budget that the FCC has
significantly underestimated the time and money it will take to comply with the
transparency and complaint procedures it adopted in its Open Internet
order (net neutrality rules).

OMB is vetting the paperwork-collection requirements to make
sure they do not run afoul of Congress's Paperwork Reduction Act mandate
to keep bureaucratic tree-killing to a minimum. NCTA has asked for
changes in those requirements, which could delay that effective date even

The FCC, when it approved the rules back in December, said
it expected the costs of compliance with new rules on transparency, blocking
and unreasonable discrimination to be "small" since the principles
are in line with current practice. NCTA says the open-ended rules mean
costs and paperwork could be far greater, and wants the FCC to rethink its estimates
so that OMB has a better idea of the burden, or amend its requirements.

The rules can't go into effect until 60 days after a notice
is published in the Federal Register that OMB has approved the data-collection
requirements. The FCC supplied NCTA with an explanation of the costs for
complying with transparency rules, which is an addendum to its filing.
The in-house cost was estimated at $734.97 per respondent per year, and
provided insight into how much the FCC pays for tech writers, engineers
and attorneys.

"The Commission believes that the respondents will use
'in-house' personnel whose pay is comparable to mid- to senior-level federal
employees (GS12/5, GS14/5, and GS15/5, plus 30% overhead)," the FCC said.
"[T]herefore, the Commission estimates respondents' hourly costs to
be about $52.86 for technical writers, $74.27 for engineers, and $87.37 for attorneys
to gather and post commercial terms, network management practices, and
performance characteristics on a website and make that information
available at the point of sale."

The FCC also anticipates five complaints per year, total,
industry-wide, at a total cost of $40,000 for the parties.

"Notwithstanding the Commission's statement that it
intended for "the costs of compliance with our prophylactic rules to be
small," said NCTA in its filing, "the broad and open-ended
transparency rules and complaint procedures actually adopted in the Open
Internet Order could impose a much greater burden on ISPs than contemplated.
Absent clear guidance as to what providers must disclose, as well as some
limitation on the scope of the complaint procedures and the availability of discovery,
the estimates provided by the Commission are unrealistic. NCTA encourages
the Commission to clarify the rules and/or amend its burden estimates
before submitting these estimates to OMB for approval."

In a talk at the American Cable Association Wednesday, House
Communications Subcommittee Chairman Greg Walden (R-Ore.) said the Senate would
not be able to act on his resolution to block those network neutrality rules
(it has passed the House) until the FCC gets on with publishing the rules in
the register.