How ISPs Can Leverage the FCC’s New Broadband Regulations to Improve Billing Transparency

Is that non-fat frozen yogurt really non-fat? “Seinfeld” fans may remember the classic episode when Jerry and Elaine, who were gaining weight, wondered if the frozen yogurt at the neighborhood shop was fat free, as advertised. Nutrition information displayed at the store would have cleared up the mystery—and Jerry’s confusion about gaining weight from eating the “fat free” treat that wasn’t.

Similarly, many telecommunications customers are often surprised and confused when they receive their first mysterious internet bill. Wait a minute! Why am I being charged $109 when I signed up for a $45-per-month plan?

Fortunately, the Federal Communications Commission (FCC) recently stepped in to eliminate those stressful surprises. Under new rules, internet service providers (ISPs)hat provide fixed and mobile (wireless) broadband services must display broadband labels for every plan at the point of sale, online and in stores. Modeled after Food and Drug Administration (FDA) nutrition labels, broadband labels include pertinent information (such as total cost and speeds) that consumers need to comparison shop for the internet service plan that best meets their needs and budget.

In addition to displaying broadband labels, ISPs can redesign their billing statements and provide a digital bill explanation tool to increase price transparency, improving the customer experience (CX).

Why Does Price Transparency Matter?

The billing experience is a critical determinant of CX and loyalty in an industry where the billing statement is often the only contact customers have with their service provider (unless there’s a problem). ISPs have plenty of room for improvement in customer satisfaction. In 2023, internet service providers ranked 41st out of 42 industries in customer satisfaction, scoring a low 68 out of 100.

Hidden fees and unexpected price increases have plagued customers for years, jeopardizing trust and loyalty. According to Forrester Research, transparency is one of several components (along with integrity and competence)hat customers use to assess a company’s trustworthiness.

Lack of transparency creates bill confusion that may increase contact center call volume. When customers don’t understand their bill, they reach for their phone. CSG research indicated that billing-related calls account for up to 50% of annual call volume, and bill confusion is a top reason for those calls.

Consumer-Friendly Broadband Labels: FCC Requirements and Implementation

The Infrastructure Investment and Jobs Act directed the FCC to require internet service providers to display consumer-friendly broadband labels with clear, accurate, easy-to-understand information about the cost and performance of high-speed internet services. Effective April 10, 2024, most ISPs must display broadband labels to their customers. Internet providers with fewer than 100,000 subscribers have until October 10, 2024, to comply with the FCC rules.

Broadband labels will include:

• Monthly broadband prices
• Introductory rates (and monthly price after the introductory rate)
• Complete list of fees
• Data allowances
• Broadband speeds
• Links to network management and privacy policies

The FCC’s current broadband labels rules require that plan information be:

• Prominently displayed: Broadband providers must display the actual label (not just an icon or link to it) in close proximity to the plan advertisement. The labels “cannot be buried in multiple clicks or hidden in a way that a consumer might miss,” according to an FCC spokesperson.
• Accessible in the account portal: ISPs must provide each customer’s label in their online account portal—and make the label available to existing customers upon request.
• Machine readable: The information on the labels must be machine readable so third parties can more easily collect and aggregate data to create comparison shopping tools for consumers.

If providers don’t display a label or post inaccurate information, consumers can file a complaint with the FCC Consumer Complaint Center.

Three Strategies to Increase Price Transparency for Customers

In an industry that’s notorious for hidden fees and unclear pricing models, price transparency is a competitive edge for ISPs. According to the Harvard Business Review, “transparency may be a major source of competitive advantage since it can help create consumer trust, deepen relationships and ultimately drive revenue growth.”

After resolving a service or technical question, customers say “paying a bill” most impacts their level of happiness as a customer. Customers who feel they are overpaying and cannot determine the reason their bills are different than they expected are more inclined to switch to a new ISP for a better deal. Because internet bills often fluctuate from month to month, it’s important to clearly explain the reasons for the changes; doing so decreases bill confusion and contact center calls.

Here are three strategies to make your billing statements more transparent:

Re-design your billing statement. Many companies’ statements include five common billing mistakes:

• Not presenting the amount due as the most prominent information
• Not providing a clear due date on the bill
• Not linking the amount due and due date
• Not explaining changes (or acknowledging no changes) since the previous bill
• Hiding mission-critical information

Re-designing your billing statement to eliminate these billing statement sins is the first step toward better transparency. Use a self-service bill design tool (such as CSG Bill Composer)o create, design and personalize your billing statements. Or rely on CSG’s Communication Design & Delivery experts to re-design your billing statement to make it clearer and more transparent.

Implement an online bill presentment solution. An online bill presentment and analytics solution (such as CSG Interactive Bill) gives customers an easy way to see what’s due and when through a transparent, easy-to-access portal. Changes from the previous month’s bill are explained up front. Customers can view and drill down into their billing information online—anytime, anywhere and on any device.

Use a digital bill explanation tool. CSG Bill Explainer provides a digital, interactive summary of the customer’s billing statement, explaining monthly charges as well as what changed and why. Bill Explainer breaks down this and other information included in the customer’s statement:

• Balance due
• If/how much the amount changed from the previous bill, and why
• Itemized charges (including fees)
• Expiration dates for promotions (e.g., introductory rates)
• Proration and taxation events

Generative artificial intelligence (GenAI) compares the customer’s billing statement to the previous month’s and creates a simple, natural language description of the changes. The system sends a text or email to the customer, indicating that the bill has changed and including a link to the personalized summary. Customers don’t need to remember their password to access Bill Explainer.