FCC Fines Smart City $750,000 for Blocking Consumers' Wi-Fi at Convention Centers

FCC Fines Smart City $750,000 for Blocking Consumers' Wi-Fi at Convention Centers
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August 18, 2015

The Federal Communications Commission (FCC) has announced a $750,000 settlement with Smart City Holdings, LLC for blocking consumers' Wi-Fi at various convention centers around the United States.

The agency says that Smart City, an Internet and telecommunications provider for conventions, meeting centers, and hotels, had been blocking personal mobile "hotspots" that were being used by convention visitors and exhibitors who used their own data plans rather than paying Smart City substantial fees to use the company's Wi-Fi service.

"It is unacceptable for any company to charge consumers exorbitant fees to access the Internet while at the same time blocking them from using their own personal Wi-Fi hotspots to access the Internet," said Travis LeBlanc, Chief of the FCC's Enforcement Bureau. "All companies who seek to use technologies that block FCC-approved Wi-Fi connections are on notice that such practices are patently unlawful."

In providing service at convention centers, the FCC says that Smart City charged exhibitors and visitors a fee of $80 to access the company's Wi-Fi services for a single day.

The FCC's investigation revealed that, if exhibitors or visitors to the convention centers did not pay this $80 fee, Smart City would automatically block users from accessing the Internet when they instead attempted to use their personal cellular data plans to establish mobile Wi-Fi networks – or "hotspots"– to connect their Wi-Fi-enabled devices to the Internet.

As part of the settlement, Smart City will cease its Wi-Fi blocking activities and will pay a $750,000 civil penalty.

In June 2014, the FCC received an informal complaint that consumers could not connect to the Internet at several venues where Smart City provided Wi-Fi service. The Bureau's investigation revealed that Smart City automatically blocked consumers from using their own "rogue" Wi-Fi networks at several convention centers the company serves, including the convention centers in Cincinnati, Ohio; Columbus, Ohio; Indianapolis, Indiana; Orlando, Florida; and Phoenix, Arizona. No evidence exists that the Wi-Fi blocking occurred in response to a specific security threat to Smart City's network or the users of its network.

This is the FCC's second major enforcement action regarding Wi-Fi blocking. In October 2014, the FCC fined Marriott International, Inc. and Marriott Hotel Services, Inc. $600,000 for similar Wi-Fi blocking activities at the Gaylord Opryland Hotel and Convention Center in Nashville, Tennessee. In January of this year, the agency also issued a stern warning to businesses against Wi-Fi blocking, stating that "persons or businesses causing intentional interference with personal Wi-Fi networks, or 'hot spots,' are subject to enforcement action."

The Smart City Consent Decree is available at:https://apps.fcc.gov/edocs_public/attachmatch/DA-15-917A1.pdf