Broadband Industry Sues New York State For Promising $15 Broadband

To help those struggling during the pandemic, New York State has passed a new law requiring that internet service providers (ISPs) provide $15 broadband to low income state residents. But the broadband industry has quickly filed suit, claiming the state is prohibited from doing so thanks in part to Ajit Pai’s 2017 repeal of net neutrality.

New York’s new law requires that ISPs offer low-income households a $15 broadband tier with speeds of at least 25 Mbps, including all surcharges and fees. Under the law, broadband providers can alternatively provide $20 broadband tiers at speeds of 200 Mbps, with any price increases capped at two percent per year.

As part of the program New York created a new state portal to help state residents find affordable service, and mandated a new study to determine real-world broadband availability in the wake of notoriously unreliable federal broadband maps. 

But the broadband industry’s lawsuit claims that states are banned from telling ISPs what to do in the wake of the FCC’s net neutrality repeal. That’s because the repeal didn’t just kill popular net neutrality rules, it effectively neutered the FCC’s consumer protection authority and even tried to ban states from stepping in to fill this consumer protection void.  

The industry used similar arguments in its attempts to prevent states like California from passing net neutrality rules. But so far, the courts haven’t looked kindly on the industry’s arguments. 

“An agency that has no power to regulate has no power to preempt the states, according to case law,” Stanford Law Professor Barbara van Schewick told Motherboard. “When the FCC repealed the 2015 Open Internet Order, it said it had no power to regulate broadband internet access providers. That means the FCC cannot prevent the states from adopting net neutrality protections because the FCC’s repeal order removed its authority to adopt such protections.” 

Roughly 42 million Americans lack access to broadband, and another 83 million live under a broadband monopoly. With neither competition nor functional regulatory oversight to rein in their worst impulses, the US telecom sector suffers from high prices, slow speeds, spotty coverage, and routinely terrible customer service.

While the Trump FCC claimed that killing net neutrality would result in a significant boost in broadband investment, that investment never arrived. Instead, the repeal curtailed the FCC’s ability to protect consumers right before a health and economic crisis struck the U.S., leaving U.S. consumers at the mercy of high prices, unreliable service, and arbitrary usage caps. 

Covid has shone a bright spotlight on how affordable access is essential for employment, education, opportunity, and health care, creating significant new pressure on policymakers to do something to disrupt the broken status quo. 

Telecom experts like the Electronic Frontier Foundation’s Ernesto Falcon say it’s a backlash the broadband industry brought upon itself by trying to have its cake and eat it too. 

“AT&T and Verizon have sued to block NY's broadband price regulation law and I am here to remind you the big ISPs did this to themselves,” Falcon said on Twitter. “Lobbying to get rid of the FCC’s authority invoked a counter push. They wanted to be unregulated monopolies and thought no one would stand against it.”

For its part, New York State says it welcomes the industry lawsuit. 

"I knew giant telecom companies would be upset by our efforts to level the playing field, and right on cue, they're pushing back," New York Governor Andrew Cuomo said in a statement. "Let me be abundantly clear—providing internet in the Empire State is not a god-given right. If these companies want to pick this fight, impede the ability of millions of New Yorkers to access this essential service, and prevent them from participating in our economic recovery, I say bring it on."