FCC Fines More Companies For Blocking Convention Center WiFi, Says Hilton Obstructed Investigation

from the anti-competitive-shenanigans dept

Over the last year, one of the FCC’s major crackdowns has been on companies that block customer WiFi at convention centers in order to drive visitors and exhibitors to the center’s own, absurdly-priced WiFi services. It began last year when the FCC fined Marriott $600,000 for blocking user WiFi to force them on to Nashville convention center services costing upwards of $1,000 per day. Marriott feebly tried to argue it was simply protecting consumers from security threats before it gave up the fight, realizing that both the law and public sentiment were both decidedly against them.

The FCC has since fined other companies for similar behavior, including a $750,000 fine levied against a company by the name of Smart City Holdings for doing the same thing at a string of convention centers all over the country. Now the FCC says it has levied yet another fine of $718,000 against a company by the name of M.C. Dean for blocking user access to their own WiFi while visiting the Baltimore convention center:

“As the exclusive provider of Wi-Fi access at the Baltimore Convention Center, M.C. Dean charges exhibitors and visitors as much as $1,095 per event for Wi-Fi access. Last year, the Commission received a complaint from a company that provides equipment that enables users to establish hotspots at conventions and trade shows. The complainant alleged that M.C. Dean blocked hotspots its customers had tried to establish at the Baltimore Convention Center. After receiving the complaint, Enforcement Bureau field agents visited the venue on multiple occasions and confirmed that Wi-Fi blocking activity was taking place.”

In all of these instances the companies in question used hardware that sent de-authorization packets to user mobile hotspots and tethered smartphones, confusing the devices and disrupting any attempted connection to them. In M.C. Dean’s case, the FCC found that the hardware it was using in the Baltimore convention center was powerful enough to disrupt WiFi connectivity for people simply passing by outside. As with everything the FCC does lately, only Commissioners Ajit Pai and Mike O’Rielly (think the Statler and Waldorf muppets but much less funny) opposed cracking down on this behavior.

In perhaps a more interesting companion announcement, the FCC notes that it has also fined Hilton hotels $25,000, but for obstructing the FCC’s investigation into similar behavior. According to the FCC, Hilton ingeniously tried to deflate any investigation into WiFi blocking by simply refusing to answer the agency’s questions:

“In August 2014, the Commission received an initial consumer complaint alleging that the Hilton in Anaheim, California blocked visitors’ Wi-Fi hot spots unless those consumers paid a $500 fee to access Hilton’s Wi-Fi. The Commission has also received Wi-Fi blocking complaints involving other Hilton properties. In November 2014, the Bureau issued Hilton a letter of inquiry seeking information concerning basic company information, relevant corporate policies, and specifics regarding Wi-Fi management practices at Hilton-brand properties in the United States. After nearly one year, Hilton has failed to provide the requested information for the vast majority of its properties.”

Surely playing mute will work? In all cases, the FCC states these companies are violating Section 333 of the Communications Act by maliciously interfering with or causing interference to lawful WiFi hotspots. Marriott had initially tried to argue that the definition of “interference” in Section 333 was ambiguous enough to create doubt over FCC authority over unlicensed spectrum here, but after regulators, the public, Google, Microsoft and wireless carriers all started yelling at Marriott in unison, it became pretty clear that trying to argue the point (just to defend clearly anti-competitive behavior) just wasn’t going to be worth it.

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Companies: hilton, smart city holdings

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Comments on “FCC Fines More Companies For Blocking Convention Center WiFi, Says Hilton Obstructed Investigation”

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Anonymous Coward says:

Re: Re:

… doesn’t malicious jamming of lawful broadcasts entail criminal charges and incarceration for all involved?

47 U.S.C. § 333 – Willful or malicious interference

No person shall willfully or maliciously interfere with or cause interference to any radio communications of any station licensed or authorized by or under this chapter or operated by the United States Government.

47 U.S.C. § 501 – General penalty

Any person who willfully and knowingly does or causes or suffers to be done any act, matter, or thing, in this chapter prohibited or declared to be unlawful, or who willfully and knowingly omits or fails to do any act, matter, or thing in this chapter required to be done, or willfully and knowingly causes or suffers such omission or failure, shall, upon conviction thereof, be punished for such offense, for which no penalty (other than a forfeiture) is provided in this chapter, by a fine of not more than $10,000 or by imprisonment for a term not exceeding one year, or both; except that any person, having been once convicted of an offense punishable under this section, who is subsequently convicted of violating any provision of this chapter punishable under this section, shall be punished by a fine of not more than $10,000 or by imprisonment for a term not exceeding two years, or both.

Anonymous Coward says:

Re: Only $25K?

Only a $25K fine for Hilton for obstructing a federal investigation? It should have been $2.5M instead!

From the Notice of Apparent Liability in the Hilton matter (p.9):

B. Proposed Forfeiture

23. Section 503(b)(1)(B) of the Act authorizes the Commission to impose a forfeiture against any entity that “willfully or repeatedly fail[s] to comply with any of the provisions of [the Act] or of any rule, regulation, or order issued by the Commission.” Here, Section 503(b)(2)(D) of the Act authorizes us to assess a forfeiture against Hilton of up to $16,000 for each day of a continuing violation, up to a statutory maximum of $122,500 for a single act or failure to act. . . .

(Emphasis added; footnotes omitted. N.B. footnote 58 regards inflation adjustments to the § 503(b)(2)(D) forfeiture amounts.)

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