Wi-Fi provider fined $750,000 for blocking mobile hotspots

The FCC has hit a company that operates Wi-Fi at many of the largest U.S. convention centers with a $750,000 punishment for multiple violations.

The Federal Communications Commission announced the fine against Smart City Holdings, LLC, on Tuesday, as part of a settlement over allegations that Smart City blocked the mobile hotspots of people who didn’t want to pay for pricy convention-center Internet.

Smart City, an Internet service provider for hotels, convention centers, and meeting centers, charges $80 per day for access, and consumers had reported being unable to enable their smartphones’ mobile hotspots in buildings where the company operated.

The fine represents the FCC’s second high-profile action against a company for blocking consumers’ lawful Internet access in recent years. The agency fined Marriott $600,000 in 2014 for its own Wi-Fi blocking scheme in Tennessee.

“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,” Travis LeBlanc, head of the FCC’s Enforcement Bureau, said in a statement. “All companies who seek to use technologies that block FCC-approved Wi-Fi connections are on notice that such practices are patently unlawful.”

The FCC, which called Wi-Fi “an essential access ramp” to the Internet, received a complaint in June 2014 from an unidentified company that provides equipment allowing users to establish hotspots. A year-long investigation revealed Wi-Fi blocking throughout the United States by Smart City and no security threats to justify the blocking.

Harold Feld, senior vice president at the consumer group Public Knowledge, applaud the agency’s action.

“Only an expert investigative agency like the FCC can ferret out these kinds of Wi-Fi jamming scams, and only an aggressive Enforcement Bureau can protect people when these scams come to light,” Feld said in a statement. “In light of the importance of Wi-Fi in our daily lives, we applaud the FCC for remaining undaunted in the face of industry pressure to ‘back down’ on enforcement and remain the consumer protection agency the American people need and deserve.”

Illustration by Max Fleishman

Patrick Howell O'Neill

Patrick Howell O'Neill

Patrick Howell O'Neill is a notable cybersecurity reporter whose work has focused on the dark net, national security, and law enforcement. A former senior writer at the Daily Dot, O'Neill joined CyberScoop in October 2016. I am a cybersecurity journalist at CyberScoop. I cover the security industry, national security and law enforcement.