FCC Fines Smart City $750K For Blocking Wi-Fi Hotspots At Hotels And Convention Centers

You would have thought that companies would have wised up after Marriott was caught using unlicensed jamming equipment in conference rooms to block the Wi-Fi hotspots of its paying customers. Predictably, when hotel patrons would complain about not being able to access the Internet with their smartphones or mobile Wi-Fi hotspots, hotel personnel would offer their own high-speed Internet services at a cost of $250 to $1,000.

Needless to say, the FCC wasn’t amused by Marriott’s actions at its Gaylord Opryland Hotel and Convention Center in Nashville, Tennessee, so it stepped in and fined Marriott $600,000. Following the Marriott incident, the FCC noted that it was witnessing a “disturbing trend” of hotels using their muscle to hamstring customers and vowed to "aggressively [investigate] and [act] against such unlawful intentional interference."

FCC Chairman Tom Wheeler
FCC Chairman Tom Wheeler (Source: Flickr/Brooke Anderson)

To prove that it wasn’t just blowing hot air, the FCC has handed down a $750,000 fine to Smart City LLC for engaging in the same shady business tactics. Smart City manages the Wi-Fi networks for a number of hotels and convention centers around the United States — specifically, Cincinnati, Ohio; Columbus, Ohio; Indianapolis, Indiana; Orlando, Florida; and Phoenix, Arizona — and was actively blocking the Wi-Fi hotspots of customers at these locations. “Disconnected” customers would then be offered Smart City’s own Wi-Fi services at a cost of $80 per day.

In addition to the fine, Smart City must discontinue its Wi-Fi blocking escapades to avoid any further run-ins with the FCC.

“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 FCC enforcement chief Travis LeBlanc. “All companies who seek to use technologies that block FCC-approved Wi-Fi connections are on notice that such practices are patently unlawful.”

For its part, Smart City is still trying to plead ignorance of the severity of its actions, with its President Mark Haley remarking, "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.”

Well, now you know!