The U.S. Federal Communications Commission scored another victory this week in its crusade to quash Wi-Fi blocking wherever it can when it handed out a $750,000 fine to Smart City Holdings, one of the nation’s largest convention Wi-Fi providers.
Smart City, which provides Internet and telecommunication services at 35 U.S. convention and meetings centers and is also in 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.
In June 2014 the FCC launched an investigation after it received an informal complaint that convention attendees couldn’t connect to their own personal hotspots at several venues where Smart City provided Wi-Fi, such as major convention centers in Columbus, Ohio; Indianapolis, Indiana; Orlando, Florida and Phoenix, Arizona. The FCC ultimately decided against Smart City, and as part of a settlement the latter agreed to stop blocking Wi-Fi at all of its venues and more than 3,000 events it services each year.
“The Internet is a vital platform for economic growth, innovation, competition, and free expression,” the FCC said in the settlement document. “Wi-Fi is an essential access ramp to that platform. The growing use of technologies that unlawfully block consumers from creating their own Wi-Fi networks via their personal hotspots unjustifiably prevents consumers from enjoying services they have paid for and stymies the convenience and innovation associated with Wi-Fi Internet access.”
Smart City claims it blocked personal Wi-Fi hotspots to keep its networks secure even though the FCC found no evidence that this was done in response to specific threats.
“We are not gatekeepers to the Internet,” said Mark Haley, president of Smart City, in a statement. “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 1 percent of all devices being de-authenticated and these same technologies are widely used by major convention centers across the globe as well as many federal agencies.”
“We have always acted in good faith, and we had no prior notice that the FCC considered the use of this standardized, ‘available-out-of-the-box’ technology to be a violation of its rules. But when we were contacted by the FCC in October 2014, we ceased using the technology in question.”
This is the FCC’s second major enforcement action regarding Wi-Fi blocking. Last October 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.
Marriott and much of the U.S. hotel industry several months later petitioned the FCC to get clarification on whether it was permissible to block attendees bring-your-own Wi-Fi capabilities at their properties but withdrew the petition in early 2015 in the face of customer opposition and vociferous opposition from the FCC.