FCC: Comcast must pay $800K for failing to market affordable standalone broadband service

Comcast (Nasdaq: CMCSA) agreed Wednesday to pay the federal government $800,000 for failing to adhere to a condition of its merger with NBCUniversal that required it to offer subscribers a standalone high-speed Internet service for two years, the FCC said.

Comcast's Internet Essentials website.

While Comcast was ordered to charge subscribers no more than $49.95 for a 6 Mbps broadband service for three years after the NBCU merger closed in January 2011, the MSO didn't make enough of an effort to tell customers about the standalone option, the FCC said. As part of the settlement, the FCC ordered a one-year extension on the merger condition, requiring Comcast to offer its $49.95 monthly "Performance Starter" tier through at least Feb. 21, 2015.

The FCC said the consent decree it reached with Comcast was significant, noting that it is the first time that it has extended conditions to a merger. "Consumers will directly benefit from the greater availability of this reasonably priced broadband option, potentially worth many millions of dollars in savings to consumers," the FCC said.

But Comcast downplayed the consent decree.  "As is often the case with services associated with government orders, the FCC had questions on how the service might have been rolled out in a different or even better way," the company said in a statement.

Last summer, Comcast began offering low-income homes a $9.95 high-speed Internet service. But its "Internet Essentials" tier has download speeds of just 1.5 Mbps, and is only available to families with children who qualify for the federal school lunch program.

For more:
- see the FCC release
- The Washington Post has this story

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