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A pen and book resting atop a paper copy of a lawsuit.

Internet service providers today sued New York to block a state law that requires ISPs to sell $15-per-month broadband plans to low-income households.

The lawsuit was filed by lobby groups including USTelecom and CTIA–The Wireless Association, both of which count Verizon and AT&T among their members. Lobby groups for many other ISPs also joined the lawsuit, with plaintiffs including NTCA–The Rural Broadband Association, the Satellite Broadcasting & Communications Association, and the New York State Telecommunications Association. The biggest cable lobby group, NCTA, did not join the lawsuit, but a cable lobby group representing small providers—America’s Communications Association—is one of the plaintiffs suing New York.

New York enacted its cheap-broadband law two weeks ago and called it a “first-in-the-nation requirement for affordable Internet for qualifying low-income families.”

With this law, New York “seeks to regulate broadband rates,” the ISPs’ complaint said. “A provision of the recently enacted New York State Fiscal Year 2022 Budget requires wireline, fixed wireless, and satellite broadband providers—no later than June 15, 2021—to begin offering to qualifying low-income consumers high-speed broadband service at a cost to consumers of $15 per month or higher-speed broadband service at a cost to consumers of $20 per month.” ISPs claim the state requirement is preempted by federal law.

Cuomo says, “bring it on”

The lawsuit was filed in US District Court for the Eastern District of New York. The broadband lobby groups asked for preliminary and permanent injunctions preventing enforcement of the law.

“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 Gov. Andrew Cuomo said today. “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.”

The state law requires $15 broadband plans with download speeds of at least 25Mbps, with the $15 being “inclusive of any recurring taxes and fees such as recurring rental fees for service provider equipment required to obtain broadband service and usage fees.”

ISPs can alternatively comply by offering $20-per-month service with 200Mbps speeds, and price increases would be capped at two percent per year. The state is required to review download speed requirements within two years and at least once every five years thereafter to determine whether they should be raised. Minimum upload speeds are not specified by the law.

Pai’s deregulation cited by ISPs

The ISPs claimed that New York’s law conflicts with the Federal Communications Commission decision, taken under then-Chairman Ajit Pai, to deregulate the broadband industry (and eliminate net neutrality rules in the process). The FCC deregulation order declared “that broadband is an interstate information service that should not be subject to common-carrier regulation,” the lawsuit said. “The Rate Regulation conflicts with that decision, as well as the Communications Act, by compelling providers to offer broadband on a common-carrier basis: at state-set rates and terms to all eligible members of the public.”

They also claimed that the low-income broadband law “intrudes into an exclusively federal field. More than a century ago, Congress enacted legislation that occupied the field of interstate communications service and, thereby, precluded states from directly regulating those services. In violation of that long-standing law, the Rate Regulation expressly seeks to set the rates and speed of an interstate communications service. No state has ever successfully engaged in such regulation.”

States can regulate broadband through consumer-protection powers, and New York will argue that its cheap-broadband requirement is not preempted by federal law. The broadband industry similarly claimed that a California net neutrality law is preempted by federal law, but US District Judge John Mendez in February rejected that argument and refused to give the industry a preliminary injunction blocking the California law.

The California case also involves a rate-regulation claim, as ISPs argue that California’s ban on ISPs charging online services for data-cap exemptions is improper rate regulation. While Mendez found that the California law isn’t rate regulation, the ISPs may have a better case in New York where the state is requiring them to offer a specific plan at a specific price.

On the other hand, the Pai-led FCC’s abdication of its Title II regulatory authority over broadband reduced its power to preempt state laws. “[I]n any area where the Commission lacks the authority to regulate, it equally lacks the power to preempt state law,” the US Court of Appeals for the District of Columbia Circuit wrote in 2019, when it struck down Pai’s attempt to preempt all state net neutrality laws.

“AT&T/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,” Ernesto Falcon, senior legislative counsel for the Electronic Frontier Foundation, wrote on Twitter. “Lobbying to get rid of the FCCs authority invoked a counter push. They wanted to be unregulated monopolies and thought no one would stand against [them].”

An antenna on a rooftop in the Bronx, with a view of the city during daytime.
Enlarge / Rooftop antenna at Immaculate Conception School in the Bronx.

Charter Communications employees who have been on strike since 2017 are building an Internet service provider in New York City called “People’s Choice.”

“People’s Choice Communications is an employee-owned social enterprise launched by members of IBEW Local #3 to bridge the digital divide and help our neighbors get connected to the Internet during the COVID-19 pandemic,” the ISP’s website says. “We are the workers who built a large part of New York City’s Internet infrastructure in the first place. We built out [Charter] Spectrum’s cable system, until in 2017, the company pushed us out on strike by taking away our healthcare, retirement, and other benefits. It’s now the longest strike in US history.”

So far, People’s Choice says it has completed rooftop antenna installations at two schools in the Bronx and installed “hardline connections to wireless access points connecting 121 units” at housing for survivors of domestic violence who have disabilities.

A Gizmodo article said the system is equipped to offer minimum speeds of 25Mbps downstream and 3Mbps upstream, meeting a broadband standard that has been used by the Federal Communications Commission since 2015. “We have a big portion of most of the Bronx covered with our antenna,” IBEW Local #3 steward Troy Walcott told Gizmodo. “Now we have to go building by building to let people know we’re out there and start turning them on.”

“A few dozen Spectrum strikers have been actively involved in the installations, but Walcott expects that at least one hundred workers are waiting in the wings for the project to scale up,” the Gizmodo article said.

Filling broadband gaps

People interested in bringing broadband to their building can fill out a form. “We work in affordable housing, supportive housing, co-op housing, NYCHA [NYC Housing Authority], homeless shelters, and regular old apartment complexes,” the webpage notes.

Rooftop antenna at Sacred Heart School in the Bronx.
Enlarge / Rooftop antenna at Sacred Heart School in the Bronx.

“After we build out a network in your building, it transfers to cooperative ownership, so profits are returned to users,” the People’s Choice website says. “We are able to provide high-speed service in most cases for $10-$20/month. No more cable company ripping you off, and as an owner, you have a vote in policies like data privacy.”

People’s Choice is similar to the volunteer-run NYC Mesh project that has been building a wireless network for unserved people in the city the past few years.

Charter, which sells Internet access under the Spectrum brand name, became the second-largest cable company in the US when it bought Time Warner Cable in 2016. Charter wants customers to “pay more for less service because they have no other choice,” Walcott said, according to an article in Vice’s Motherboard section.

Walcott said the Charter employees were motivated by inaction both from Charter and politicians. “Having elected officials thank us quietly for our sacrifice but not say anything about our strike publicly motivated us. Seeing customers denied service during COVID because they had outstanding bills motivated us,” he said.

Turbulent times since Charter bought TWC

About 1,800 Charter workers began their strike in March 2017. Charter hired hundreds of replacement workers and tried to decertify the union, an attempt the union has been fighting at the National Labor Relations Board.

Last year, a New York City broadband plan said that nearly a third of households in the city “do not have a broadband connection at home” and that “more than 1.5 million New Yorkers have neither a mobile connection nor a home broadband connection.” Low-income residents were more likely to lack service, and areas with higher incomes benefited from more home-Internet competition.

In July 2018, the New York State Public Service Commission voted to revoke its approval of Charter’s purchase of Time Warner Cable, saying the company repeatedly failed to meet deadlines for broadband expansions that were required in exchange for merger approval. The commission ordered Charter to sell the former Time Warner Cable system in New York, but Charter avoided that fate by agreeing to more broadband deployment and a $12 million payment to be used by the state for expanding broadband to unserved and underserved homes.

Disclosure: The Advance/Newhouse Partnership, which owns 13 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.