FCC's Revised Device Marketing Rules Get Broad Support, Despite Concerns

Comments support a CTA proposal to allow the limited marketing and sales of wireless devices to consumers before equipment authorization, as long as those devices aren't provided to consumers until authorized by the FCC. Many sought changes to further liberalize the rules, including raising the number of devices that would qualify for a waiver. Comments were posted Friday in docket 20-382. Commissioners approved an NPRM 5-0 in December (see 2012100069).

Reconsider the proposed limit of 4,000 devices that could be pre-sold under a waiver, CTA urged: “There are more than 14,000 wireless carrier-branded stores in the U.S., and the largest electronics retailers, like Apple, Best Buy, and Walmart, account for an additional 6,000 stores that consumers look to first for 5G devices and other important electronics purchases.” The group weighed in against red tape, saying it has no concerns about a limited record-keeping requirement, but device manufacturers shouldn’t face a reporting mandate. “The Commission also should not require manufacturers to include a label on device packaging noting that it shall not be delivered to consumers prior to obtaining equipment authorization,” CTA said.

CTA asked the FCC to move quickly. Preordering “has become commonplace, and the pre-sales of radiofrequency devices will not introduce additional risk of consumer harm into the consumer technology marketplace,” the group said: “Customers pre-order everything from cars to books to playoff tickets, fully aware that they will need to await delivery.”

“The proposed 4,000 device threshold would be insufficient to provide even one device to each retail store located in the United States,” Samsung Electronics commented. “To prevent the immediate and frequent need for waiver, the Commission should consider a device limit more in line with actual need based on the number of retail stores, and in any event no fewer than 12,000,” Samsung said.

Updating the marketing rules “will allow manufacturers to gather more accurate information about consumers’ intent to purchase, will lead to better supply-chain management, and could help to avoid manufacturing waste,” said the U.S. Chamber of Commerce Technology Engagement Center. Increase the threshold to at least 12,000, the Chamber center said: “While even this increased number would not allow for a single unit of a new device, such as a smartphone, to be sent to every big box store or carrier storefront in the United States, it would provide a useful step forward.”

The Telecommunications Industry Association, the Association of Home Appliance Manufacturers, Engine, The Internet Association, Incompas, the Rural & Agriculture Council of America and TechFreedom jointly filed in support. “The ability to make presales will enable better product and supply chain planning, which is increasingly important as technology evolves more rapidly, and even more critical during this unprecedented period,” they said. The groups also asked the FCC to reconsider the proposed 4,000-device limit: Raising the number to 12,000 would “better reflect the number of U.S. retailers that would benefit from pre-authorization delivery of devices.”

Raise the device limit, urged Qualcomm and Incompas. “For the United States to reap the benefits of the 5G economy as it has with the 4G app economy, policymakers including the FCC must ensure that innovative companies can move their products efficiently to consumers,” the Computer & Communications Industry Association said.

CTIA supported action, but urged the FCC to “reconsider its tentative rejection” of CTA’s proposed deletion of Section 2.803(c)(2)(ii), which permits limited marketing, to a narrow class of specialized entities. “The framework changes suggested by CTA, and supported by the NPRM, would allow more widespread marketing and sales to the public, including in residential areas,” CTIA said: Deleting the section “would further these goals by removing conflicting guidance on the applicability of the rules and simplifying the underlying rules governing marketing.”

CTA was pleased with the “across-the-board support” for changes to the rules, Jamie Susskind, vice president-policy and regulatory affairs, told us. “Our hope is that acting Chairwoman [Jessica] Rosenworcel will be able to move quickly to adopt an order in the proceeding, as we believe the proposals are in line with the administration’s broader priorities, including helping get devices into the hands of consumers for remote work and learning during the pandemic,” she said.