Broadband industry sues New York over $15 price cap

Companies argue FCC regulations forbid this type of state-level regulation

Man plugging Ethernet cable into a router

The broadband industry is suing the State of New York to stop it from imposing a $15-per-month cap on broadband fees for low-income families.

The state passed a law in mid-April to provide affordable internet access for approximately seven million New Yorkers across 2.7 million households. Eligible recipients included those who received free or reduced-price lunches, supplemental nutrition assistance program (SNAP) benefits, Medicaid, senior citizen or disability rent protection, or affordability benefits from utilities.

The Empire State also unveiled an Affordable Broadband Portal to help New Yorkers find the affordable broadband options in their area and announced an in-depth statewide broadband mapping study to find broadband availability, reliability, and cost.

On Friday, a collection of industry groups filed suit against New York State Attorney General Letitia James, arguing states can't regulate broadband services. The suit contends the Federal Communications Commission (FCC) ruled in 2018 that broadband is an interstate information service that can't be regulated as a common-carrier service.

"The Rate Regulation expressly seeks to set the rates and speed of an interstate communication services," it said. "No state has ever successfully engaged in such regulations."

The FCC's 2018 ruling under chairman Ajit Pai came after a public consultation fraught with controversy. It was hotly contested because it changed the Commission's view of broadband communications from a common-carrier utility to a luxury, relaxing its control over broadband ISPs and effectively overturning federal net neutrality rules.

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While the ruling included language to stop states from regulating broadband themselves, the ability to pre-empt state decisions hasn't been tested in court. The broadband industry is arguing the point in a legal battle with California, which seeks to impose state-level net neutrality laws.

Broadband providers already serve low-income users via programs like Lifeline and the new Emergency Broadband Benefit, which comes into effect this month, the lawsuit added.

The New York State Telecommunications Association, the CTIA, ACA Connects, USTelecom, the NCTA, and the Satellite Broadcasting & Communications Assocation filed the suit.

New York governor Andrew Cuomo dismissed the broadband industry's complaint.

"I knew giant telecom companies would be upset by our efforts to level the playing field, and right on cue, they're pushing back," he said, pointing to the need for lower-cost connectivity during the pandemic. "This is nothing more than a transparent attempt by billion-dollar corporations putting profit ahead of creating a more fair and just society."

As part of its announcement last month, the state also launched ConnectED NY, an emergency fund to provide 50,000 economically disadvantaged students with free internet access until June 2022.

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