WASHINGTON, D.C.—At the request of Congresswoman Anna G. Eshoo (D-Calif.), Ranking Member of the Communications and Technology Subcommittee, the nonpartisan Government Accountability Office (GAO) today released a final report describing the use of data caps by the nation’s fixed and mobile broadband service providers. Eshoo requested the report of the GAO in May 2013 because of concerns that discriminatory or arbitrary applications of “usage-based” broadband pricing, often referred to as data caps, could discourage innovation, competition and consumer choice on the Internet.

“Broadband access has proliferated into nearly every facet of our daily lives and our economy, yet we know little about the effects data caps are having on its growth and use by consumers,” Eshoo said. “The GAO report released today reveals growing use of data caps by fixed broadband service providers, consumer confusion over data usage, and a need for the FCC to monitor use of data caps as part of its responsibility to promote the public interest.”

In July, Eshoo released preliminary findings of the GAO report, writing to the FCC, “In the midst of the net neutrality debate, there is a new threat to the free and open Internet and that is usage-based pricing which may include the throttling or slowing down of data speeds, overage fees and the exemption of some online services or applications from data caps.”

Key findings of the GAO include:

• Under usage-based pricing, broadband access providers can charge varying prices, change connection speeds, or take other actions based on Internet data consumed.
   
• Seven of the nation’s 13 largest fixed broadband access providers now use usage-based pricing to some extent.
   
• Participants across all eight of the GAO’s focus groups expressed strong negative reactions to the concept of usage-based pricing by fixed broadband access providers.
   
• Some broadband provider estimates vary on data consumed for the same type of online content, confusing customers.
   
• Fixed broadband access providers facing limited competition could use usage-based pricing to increase profits, potentially resulting in negative effects, including increased prices, reductions in content accessed and increased threats to network security.

Eshoo concluded, “I urge the nation’s fixed broadband providers to heed the recommendations of the GAO and proactively adopt a voluntary code of conduct just as mobile providers have done. This will improve consumer experience and ensure a more vibrant online marketplace. The FCC should also make better use of the data it is collecting on data caps to understand how best to inform consumers and promote the public interest.”

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