In an effort to modernize communications, the Federal Communications Commission (“FCC”) has decided to allow cable operators to send general notices to subscribers required by the so-called Subpart T rules (47 CFR §§ 76.1601 et seq.) to e- verified customer emails. This decision was announced through a Report and order on November 15, 2018. This update is part of the growing trend for the use of electronic communications and electronic contracts to replace paper, as supported by the Federal Act on Electronic Signatures in Global and Domestic Commerce (“E-Sign Act”) and the related state laws. The E-Sign Act allows electronic records to meet legal requirements that certain information must be provided in writing if the consumer has affirmatively consented to such use. However, the E-Sign Act allows federal agencies such as the FCC to exempt a specific category or type of record from normally required consent requirements if it makes the agency’s requirements less burdensome and does not harm consumers. In this case, based on the knowledge that it would be impractical for cable operators to attempt to obtain permission from each individual customer before initiating electronic delivery of these general notices, the FCC has waived the consent requirement in its discretion pursuant to of the E-Sign Act.
The FCC’s November decision expands on a June 2017 declaratory ruling that allowed cable providers to send annual rate and channel lineup notices via email, a first step to streamlining paper notice requirements. The updated rules would cover additional notices, such as privacy information, channel cancellations, service change notices, service change notice, and basic service level information, among other things. The report and order also authorize cable providers to respond to consumer complaints, billing disputes and other requests through a verified email address. The Order stipulates that the supplier may respond by email if the consumer has used email to make the inquiry or complaint or if the consumer specifies email as the preferred delivery method in the inquiry or complaint . The FCC believes that allowing cable operators and consumers to use the same mode of electronic communication gives cable providers a more efficient means to respond to inquiries and complaints.
In order to ensure that this process benefits customers, the FCC has put in place various safeguards, such as requiring notices to be sent to verified email addresses and requiring mandatory opt-out language for those who wish to receive paper notices. According to the FCC, verified email addresses can be: (1) one that the subscriber has provided to the cable operator (and not vice versa) for the purpose of receiving communications, (2) one that the subscriber regularly uses to communicate with the cable operator, or (3) one that has been confirmed by the subscriber as an appropriate vehicle for the delivery of notices. The FCC has also mandated cable providers to clearly and prominently display a opt-out phone number in the body of the email delivering notices so subscribers can opt-out of hard-copy delivery at any time . This is a minimum requirement, and the FCC has encouraged cable providers to choose to offer additional choices to their customers as prominently in the body of the email.
While cable operators liked this new development, Commissioner Jessica Rosenworcel expressed concern about the FCC’s decision, saying:
“Putting new charges and fees into my already crowded email inbox makes it likely that I will miss out on any cost increases. So before my video provider raises my email rates, I think I deserve the right to choose to do so.”
To address the Commissioner’s concern about crowded inboxes, the FCC mandated opt-out language that allows customers to revert to mailed paper notices. The Commissioner’s concern highlights an issue we have already addressed regarding the ability of an email exchange to serve as a binding agreement.
The FCC also issued a notice of proposed rule asking for comments on whether cable operators can send notifications via text messages or other means in the future (for example, smartphone apps, an electronic message center accessible on a user’s television screen ). Industry insiders said that customer communication is constantly evolving and that vendors should not limit themselves to email as the sole means of written electronic communication with customers.
Whether or not the FCC approves the request for additional written electronic communications, the FCC’s November decision is a significant step toward modernizing communications between customers and cable operators. The ability to move in that direction can save an organization substantial sums of money in streamlining its print and mail operations. As a result, electronic communications such as email alerts are increasingly being adopted instead of paper. Unlike the FCC, however, most organizations do not have the ability to waive certain requirements associated with the E-Sign Act. Therefore, organizations that choose to transition to electronic communications must ensure they comply with the requirements of the E-Sign Act. Sign Act and all applicable state laws.