Telecom Giants Head To Court To Kill NY State’s Demand They Give Poor People $15 Broadband

from the helping-people-is-simply-a-bridge-too-far dept

Recently, New York State passed a new law (pdf) demanding that regional broadband providers (Verizon, Charter Spectrum, and Altice) provide low-income consumers $15, 25 Mbps broadband tiers to help them survive COVID. The goal: to try and help struggling Americans afford the high cost of broadband during an historic health crisis. Under the proposal ISPs are also allowed to offer $20, 200 Mbps tiers, with any price increases capped at two percent per year.

U.S. Regulators engaging in anything even close to price regulation of regional monopolies is, again, said monopolies’ worst nightmare. As a result, the broadband industry quickly sued New York, insisting that the state is forbidden from passing such a law thanks in part to the Trump administration’s net neutrality repeal (which basically attempted to lobotomize state consumer protection authority in addition to killing popular net neutrality rules).

As the case heads to court, it could have broader implications for other state efforts to mandate lower costs for consumers (in times of crisis or not):

“The industry fear is that other states might impose requirements far more onerous than what New York requires, such as by further lowering the price, raising the speed requirements, or expanding the eligibility pool to make broadband ‘affordable’ for middle-class customers,” added Levin.

These are, of course, the same regional telecom monopolies recently busted for charging low income Americans significantly more money for what’s often slower service. Why? Because they can. There’s very little competition in many of these neighborhoods, and in most states lawmakers and regulators are little more than glorified rubber stamps for telecom monopoly interests.

These are also many of the same regional telecom monopolies recently caught ripping off COVID relief programs to their own financial benefit. They want to ruthlessly derail any competitive disruption then exploit the end result. When government rarely steps in to try and address market failure, it runs into a court system that generally tends to favor monopolization over the public interest, and into politicians who are blindly loyal to companies tethered to our first responder and domestic surveillance networks.

Ideally, you’d prefer pro-competitive policies to price caps. New York State is attempting that as well by embracing community broadband networks and community-owned middle mile networks designed to drive down overall access costs. Entrenched telecom monopolies are busy trying to crush those efforts as well in a bid to maintain the very broken, but very profitable, status quo.

Unfortunately for the nation’s monopolies, COVID ignited an unprecedented sense of policy urgency after Americans got a dramatic crash course in the importance of reliable, affordable broadband. That motivation isn’t expected to wane anytime soon. Americans are sick of substandard broadband, and industry efforts to protect themselves from disruption and reform are much harder than they used to be.

Filed Under: , , , , ,

Rate this comment as insightful
Rate this comment as funny
You have rated this comment as insightful
You have rated this comment as funny
Flag this comment as abusive/trolling/spam
You have flagged this comment
The first word has already been claimed
The last word has already been claimed
Insightful Lightbulb icon Funny Laughing icon Abusive/trolling/spam Flag icon Insightful badge Lightbulb icon Funny badge Laughing icon Comments icon

Comments on “Telecom Giants Head To Court To Kill NY State’s Demand They Give Poor People $15 Broadband”

Subscribe: RSS Leave a comment
7 Comments
Anonymous Coward says:

Re:

“ludacris”

The rapper?

Anyways .. this looks to be another bandaid rather than actually addressing the problem.

If your business needs employees, then your business model and market analysis need to take into account what wage will support said employee(s) in the local area rather than expecting the government to subsidize your bad business model with all sorts of convoluted contortions of your free market model.

Anonymous Coward says:

In a fair world...

Imagine if the Federal government told Big Telecom, “you can either provide a basic and essential service to everyone for $15-20/month or we will provide it at no cost to the end user” (taking a page from another successful government program)?

The monopolies would either have to compete in the free market or Die In A Fire as god intended.

Anonymous Coward says:

Re:

The monopolies would either have to compete in the free market or Die In A Fire as god intended.

In the modern world, they’d immediately start suing and lobbying to stop this, which in any case would remain something that the federal government told people would happen but isn’t really. Probably the incumbents would acquire some contracts to study it, maybe even wire up a few neighborhoods before the program imploded like New York City’s. And then an election would happen and it would be officially canceled.

The REA was effective and seems like a reasonable parallel: “the provision of power to remote areas was not thought to be economically feasible…. ninety percent of farm homes in the U.S. were electrified [in 1959], compared to three percent in the early 1930”. Too bad we no longer have effective government. Also, it understates the problem. When we compare American broadband against East Asia, for example, people always bring up the fact that the USA has much lower density than those countries. Which is true, but quite irrelevant when we can’t solve the problem in cities as dense as NYC, and when the rural areas of Europe can.

Add Your Comment

Your email address will not be published. Required fields are marked *

Have a Techdirt Account? Sign in now. Want one? Register here

Comment Options:

Make this the or (get credits or sign in to see balance) what's this?

What's this?

Techdirt community members with Techdirt Credits can spotlight a comment as either the "First Word" or "Last Word" on a particular comment thread. Credits can be purchased at the Techdirt Insider Shop »

Follow Techdirt

Techdirt Daily Newsletter

Techdirt Deals
Techdirt Insider Discord
The latest chatter on the Techdirt Insider Discord channel...
Loading...