FCC Fines Company Caught Blocking Wi-Fi To Force Visitors On To Their Own, Absurdly-Priced Services

from the packet-shenanigans dept

The FCC has fined yet another company for blocking user Wi-Fi access in order to drive customers to the company’s own, ridiculously-expensive Wi-Fi options. According to an FCC announcement, regulators have fined Smart City Holdings, LLC $750,000 for blocking user access to Wi-Fi at a number of convention centers served by the company. More specifically, Smart City was caught using common technology that sends de-authorization packets to user devices, kicking them off of their own personal hotspots or tethered smartphones while in Smart City business locations.

This was done, says the FCC, so that users would have to use Smart City’s own service, which according to this brochure for the Charlotte convention center (pdf), is provided at pricing that’s downright comical. Smart City offers convention center exhibitors access to 24 hours of blisteringly-fast (1.5 Mbps) Wi-Fi for $80, three days of Wi-Fi for $160, or five days for $360. If you’re just a conference center visitor your options get even slower, with the company providing 768 kbps Wi-Fi service for $13 per 24 hours.

Obviously most users would rather just use their own phone as a hotspot to avoid these charges, and the FCC reminds everyone that acting like a jackass and preventing this from happening to make additional money simply isn’t ok:

“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.”

This is the second time the FCC has had to step in and slap some wrists. The company fined Marriott $600,000 last year for the same thing, though Marriott was blocking local Wi-Fi to drive users to even more expensive, $1,000 per device Wi-Fi service. Marriott originally tried to fight the agency by arguing this was all done to protect the safety and security of their customers, but sheepishly backed off of the practice once they realized the court of public opinion was very clearly not on its side.

Like Marriott, Smart City apparently couldn’t help itself, and felt it necessary to issue a bullshit statement pretending the practice was about network security:

“As recommended by the Department of Commerce and Department of Defense, we have occasionally used technologies made available by major equipment manufacturers to prevent wireless devices from significantly interfering with and disrupting the operations of neighboring exhibitors on our convention floors. This activity resulted in significantly less than one percent (1%) of all devices being deauthenticated and these same technologies are widely used by major convention centers across the globe as well as many federal agencies.”

So yeah, uh, we weren’t being anti-competitive asses, we were simply worried about network security (the irrelevant DOD reference is a nice touch though). Fortunately, Smart City’s statement also makes it clear they see the futility of fighting the FCC on this issue:

“While we have strong legal arguments, we?ve determined that mounting a vigorous defense would ultimately prove too costly and too great a distraction for our leadership team. As a result, we?ve chosen to work cooperatively with the FCC, and we are pleased to have resolved this matter. We are eager to return our energies to providing leadership to our industry and delivering world-class services to our clients.”

Yeah, it’s probably a good idea to get back to what you do best: charging outrageous pricing for pathetically-slow Wi-Fi service.

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Comments on “FCC Fines Company Caught Blocking Wi-Fi To Force Visitors On To Their Own, Absurdly-Priced Services”

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37 Comments
Anonymous Coward says:

“While we have strong legal arguments”

Uh no, you have no legally based arguments for blocking wifi access either via it’s protocol specs or white noise jamming. If your lawyers told you that you did, they were flat wrong. The FCC will come down on jamming legitimate airwaves use faster than anything else.

DannyB (profile) says:

Re: Entitlement to a limited natural resource

It’s amazing how these organizations consider themselves to be exclusively entitled to OUR spectrum, which is a LIMITED and NATURAL resource.

Because spectrum is limited, our democratically elected government (such as it is) manages this resource for us, just as it does for other limited natural resources like clean water and clean air.

Where does a hotel come off thinking it has an exclusive entitlement to use OUR spectrum and kick us off? Especially when they are breaking the laws of the land by doing this, and we are within the laws of the land by using our own mobile devices for WiFi. (And using our devices and spectrum that we legally PAID for!)

If they want to complain about so many WiFi hotspots, then it is their own fault. Point their finger at themselves. If they had free WiFi, nobody would be using their own mobile hotspots, and they wouldn’t have a spectrum management or congestion problem in the local area. If they were GENUINELY concerned about insecurity of some mobile hotspots, then again, this is their own fault — offer free WiFi and the problem goes away.

One other thing: we need to get this terminology ‘Rogue Access Point’ or ‘Rogue Hot Spot’ out of the vocabulary. It is these jamers that are Rogue, and the people using them are the criminals violating the laws of the land. The people whose mobile hotspots they are jamming are not the crooks or rogues. They are the ones operating WITHIN the laws of the land, using what they paid for.

And ‘crooks’ is the right word to call them for another reason: $80 / day for WiFi.

I’ll shut up now.

Sheogorath (profile) says:

[…] Smart City was caught using common technology that sends de-authorization packets to user devices, kicking them off of their own personal hotspots or tethered smartphones while in Smart City business locations.
The company fined Marriott $600,000 last year for the same thing, though Marriott was blocking local Wi-Fi to drive users to even more expensive, $1,000 per device Wi-Fi service.
Methinks a name change is in order because in failing to learn from the mistakes of others, this company acted more like Dumb City than Smart City.

nasch (profile) says:

Re: What happened to the jammiers....

Normally the jammer transmitters would be confiscated and destroyed by the FCC.

They weren’t really using jammers, just sending deauthentication packets over the network. If you had a device that would ignore those packets, it wouldn’t have any effect on you.

http://hackaday.com/2011/10/04/wifi-jamming-via-deauthentication-packets/

ltlw0lf (profile) says:

Re: I bet...

…that if any convention center served by Smart City hosted either Defcon or Black Hat Smart City would find out real fast how ridiculous those prices are.

Nukes are never a good weapon of choice. That is essentially what would happen here, the participants, realizing that there is some sort of jamming going on, would in turn jam the jammers, and the site would become a deadzone for WIFI. No wifi, no customers.

Which probably still wouldn’t convince these folks of how bad their ways are; but not having the gravy train (nobody able to purchase or use WIFI,) could possibly cause them to go bankrupt. So the problem would eventually correct itself. Though I suspect they would bitch and moan about the hackers taking their legitimate WIFI service offline, even as their cognitive dissonance would prevent them from realizing they were doing the same to their customers.

DannyB (profile) says:

Why WiFi should be free

Hotels offer the following things for FREE:
* air conditioning
* heating
* indoor plumbing
* electrical outlets
* drinking fountains
* in room TV with at least a few channels

ALL of the above items:
* cost a great deal to initially build
* have an ongoing cost to operate

Yet the hotels don’t have outrages charges for these other things? Having an $80 / day charge, or even a $5 / day charge for WiFi would be like:
* $50 / day for indoor plumbing
* $20 / day for TV
* $40 / day for electrical outlets
* $60 / day for air conditioning
* etc

So why don’t hotels have free WiFi?

It is also amusing that inexpensive motels have free WiFi but outrageously prices highway robbery hotels charge high prices for WiFi?

DannyB (profile) says:

Re: Re: Why WiFi should be free

Yes, Free, really.

I was talking about hotels. I think my argument was clear. If they offer free indoor plumbing, they should offer free WiFi. Both are essential for today’s traveler, whether for business or personal use.

As for other businesses like an ice cream shop, or coffee shop, free WiFi makes sense for the same reasons. It’s like they have other things for free, WiFi is just a minor cost of doing business and making your business more attractive than your competitor.

Back to hotels, it is laughable now, but remember when motels used to have big signs out front screaming:
* Color TV!
* Air Conditioned!

That seems laughable now. But WiFi is the same way. It has passed from an optional extra to a basic necessity. The cost of operating WiFi should just be built in to the cost of the room. If Motel 6 can do it, then the Hilton can surely afford to do it.

Uriel-238 (profile) says:

Re: Re: Re: One could make the same argument about telephone calls.

And, in fact, should.

I guess landline service is rendered pretty obsolete these days, and there are WiFi telephony services that are free, but still, it shouldn’t be that expensive to Marriott or Hilton to allow people to call anywhere in the world as a complimentary hospitality service.

DannyB (profile) says:

Re: Re: Re:2 One could make the same argument about telephone calls.

Yeah, that is actually a good argument.

At least nationwide. The reality is that the cost to Mariott for nationwide calling is free to cheap. They should not be charging an arm and a leg to allow you to make this call.

It is a perfect demonstration that this ‘service’ is crooked. Sort of like if they offered a ‘service’ of kicking you in the nads.

Coyne Tibbets (profile) says:

Re: Why WiFi should be free

Oh, man, don’t give them ideas. They’ll be like the airlines:

“Yes sir, the room is $28. Now, will you be needing basic plumbing? That’s $19 additional. Oh, you’ll want to take a shower, too? Then that will be $24 extra. Now the rooms can get a bit uncomfortable without the climate comfort package, will you want that? Only $18 extra. Right. Now, if will you need to be plugging in any devices…”

Anonymous Coward says:

I don’t understand how there could be ‘interference’ on Wifi if everyone’s using a different wireless network ID, also known as SSID.

You can have two different Wifi networks on channel 1, each with it’s own unique Wifi name, without interference.

I suppose someone could try to jam a channel by duplicating an existing Wifi name, but I think ‘Smart’ City Holdings is full of crap and just price gouging. Safety and security my buttocks.

John Fenderson (profile) says:

Re: Re:

“You can have two different Wifi networks on channel 1, each with it’s own unique Wifi name, without interference.”

It depends on what you mean by “interference”. Multiple hotspots using the same channel do interfere with each other at the radio level, which is why you see performance degradation when that happens. They don’t interfere with each other in the sense of completely disrupting the connections, though.

Uriel-238 (profile) says:

Is $750K a relevant chuck of change for a fine like this?

I would expect a company like Smart City Holdings loses $750,000 from its pockets whenever it sneezes. Or am I overestimating the size of the company?

WiFi internet access was free the last time I went to a travel-lodge, and Marriott blocked private WiFi in the meeting halls but not the bedrooms.

I saw a headline about Marriott announcing it too was going to halt the practice of blocking private WiFi. Does this correlate?

DannyB (profile) says:

Re: Is $750K a relevant chuck of change for a fine like this?

It might be depending on how many people paid $80 / day for WiFi.

If you had ten-thousand purchasers, for one day, you would have $800,000. That’s still $50K profit.

Now if you had very much less than ten thousand purchaser-days worth, then the fine starts to be significant, as it is pure loss, beyond any minor costs of providing the ‘service’ of highway robbery WiFi.

Mason Wheeler (profile) says:

“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.”

Since his second sentence states plainly that blocking/jamming is illegal, is the first even necessary?

Uriel-238 (profile) says:

Re: Exorbitant Fees to access the Internet

In a more classical American English, the first statement addresses gouging by creating a localized monopoly (akin to concessions at movie theaters and sports arenas).

In contemporary American English, the while at the same time clause renders it incidental and only enforces the second statement, since the gauging clause is made conditional to the blocking contingency.

Also unacceptable is meaningless. Companies have neither ethics nor manners and only understand the stark letter of the law.

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