The $1.25 million fine that Verizon Wireless has agreed to pay the FCC could offer a hint of how seriously the commission may take reported violations of its Net Neutrality rules. Verizon Wireless did not admit to any wrong-doing in the settlement announced yesterday – and the alleged violation actually pertained to rules associated with the 700 MHz C-block spectrum that Verizon won at auction several years ago. But those rules were quite similar to the Net Neutrality guidelines that the FCC adopted at the end of 2010.
The C-block rule at issue, which allows wireless customers to use any application on their operator’s network, has a counterpart in the more recent Net Neutrality guidelines, also known as the Open Internet order, which state that “a person engaged in the provision of mobile broadband Internet access service. . . shall not block . . . applications that compete with the provider’s voice or video telephony services.”
The order also includes a similar requirement for landline broadband service providers.
“Today’s action demonstrates that compliance with FCC obligations is not optional,” said FCC Chairman Julius Genachowski in the commission’s announcement about the settlement. “The open device and application obligations were core conditions when Verizon purchased the C-block spectrum.”
According to the release, the FCC began an investigation into Verizon Wireless after news reports suggested that the company had persuaded a “major application store operator” to prevent Verizon customers from obtaining a tethering application to allow a single mobile data connection to be shared by multiple devices. At that time Verizon Wireless required all customers who wanted to tether to pay for a Verizon-provided service. Since then the company has changed its rules to allow customers on usage-based pricing plans to tether using any application without paying an additional fee, the FCC noted.
In addition to paying $1.2 million, Verizon has agreed to advise the application store operator that it no longer objects to the availability of the tethering applications to C-block network customers. The company also said it would provide training to employees about C-block rules, would run any communications with application store operators by legal counsel before sending them and would report any instances of noncompliance with the C-block rule at issue.
In a statement, Verizon Wireless said it has “made clear to our customers that when using our services, they can go where they want and do what they want on the Internet, using the lawful applications and devices of their choice.”
According to the statement, the company “has always allowed its customers to use the lawful applications of their choice on its networks, and it did not block its customers from using third-party tethering applications.”
Added Verizon, “This consent decree puts behind us concerns related to an employee’s communication with an app store operator about tethering applications and allows us to focus on serving our customers.”