Federal Communications Commission (FCC)

A new law seeking Chinese divestment of TikTok is unlikely to survive scrutiny if challenged for reasons similar to those that blocked Montana’s ban against the app, free speech experts tell us.

Federal law doesn't preempt New York state’s Affordable Broadband Act (ABA), the 2nd U.S. Circuit Court of Appeals decided Friday. In a 2-1 opinion, the court reversed the U.S. District Court for Eastern New York, which had barred the state from enforcing the 2021 Affordable Broadband Act (ABA). The ABA required $15 monthly plans providing 25 Mbps download and 3 Mbps upload speeds for qualifying low-income households.

The 9th U.S. Court of Appeals agreed with a lower court that denied preliminary injunction against the California Public Utilities Commission shifting to a per line surcharge for the state Universal Service Fund. T-Mobile’s Assurance Wireless had argued that the state must align with the FCC’s revenue-based method for federal USF. But on March 31 last year, the U.S. District Court for Northern California decided not to block the CPUC’s April 1 change. The 9th Circuit heard arguments on an appeal in October (see 2310170042). "The carriers have failed to show a likelihood of success on their claim that the access line rule is 'inconsistent with' the FCC rule,” Judge Ryan Nelson wrote in Friday’s opinion, which Judges Jacqueline Nguyen and Eugene Siler joined (case 23-15490). The court referred to the Communications Act's Section 254(f), which prohibits USF rules that are "inconsistent" with FCC rules. Inconsistent doesn’t mean different, Nelson wrote. "The access line rule differs from the FCC’s rule funding interstate universal service programs. But the carriers have not shown that it burdens those programs, and they have thus failed to show that they are likely to succeed on their claim that it is inconsistent with those rules." Also, the court rejected T-Mobile’s claim that the surcharge rule is preempted because it's inequitable and discriminatory. "The carriers argue that they are harmed more than local exchange carriers,” but the CPUC rule treats all telecom technologies “the same and, if anything, is more equitable than the prior rule, under which most of the surcharges came only from ever-dwindling landline services,” Nelson said. The CPUC’s "course correction" is "a fair response to a real problem,” he added. “In a world of ever-evolving telecommunications technologies, competitive neutrality must allow some play in the joints. To hold otherwise would hamstring California’s ability to satisfy its statutory mandate of providing universal service." T-Mobile also argued the change was discriminatory because the CPUC rule treats providers who get federal affordable connectivity program (ACP) support differently from those in the state LifeLine program. But the court found differences between the programs and noted that companies in ACP have the option of joining LifeLine. The decision "affirms that the CPUC's surcharge rule is consistent with federal law," said a commission spokesperson. "The CPUC will continue to utilize the surcharge to ensure consumers have safe, reliable, affordable, and universal access to telecommunications services." T-Mobile didn’t immediately comment.

The Senate Commerce Committee confirmed Thursday the panel plans to mark up the draft Spectrum and National Security Act and five other tech and telecom-focused bills during a Wednesday executive session, as expected (see 2404240074). The 108-page draft measure from committee Chair Maria Cantwell, D-Wash., would restore the FCC’s spectrum auction authority through Sept. 30, 2029, also as expected (see 2403210063). The proposal also provides a new vehicle for allocating stopgap funding for the commission’s ailing affordable connectivity program amid a delay in advancing a separate House-side bid to force a floor vote on providing that money, lobbyists told us.

Most industry groups opposed the FCC's decision restoring net neutrality rules and reclassifying broadband internet access service (BIAS) as a Communications Act Title II service Thursday. Most disagreed with Chairwoman Jessica Rosenworcel on the order's legal standing, warning it could likely be overturned if a challenge is brought (see 2404250004). The Wireless ISP Association will "carefully review" the order and "determine what legal recourse we should take," Vice President-Policy Louis Peraertz said. Several consumer advocacy groups praised the order.

The anticipated end of the Affordable Connectivity Program will bring big competition among broadband internet access service providers for low-income subscribers, according to telecommunications and wireless industry analysts. Multiple BIAS providers are already rolling out new low-cost offerings or pledging to temporarily subsidize ACP subscribers as they seek to capture or keep them. More providers will follow suit, we're told. With the last of its funding, ACP will provide a $14 reimbursement in May rather than the usual $30 (see 2404100082).

Republican members of the House and Senate Commerce committees echoed arguments from opponents of the FCC’s draft net neutrality order in a letter to Chairwoman Jessica Rosenworcel ahead of the commission’s expected adoption of the new rules (see 2404190038). The panels’ Republicans are eying a range of potential actions countering the net neutrality bid (see 2404180058). Meanwhile, House Communications Subcommittee Chairman Bob Latta (Ohio) and 11 other Republicans urged Rosenworcel last Thursday to “leverage all resources at its disposal for a successful 5G Fund that maximizes the reach and effectiveness of the program.”

Congressional Republicans have remained relatively quiet about the FCC’s draft net neutrality order since Chairwoman Jessica Rosenworcel released it earlier this month (see 2404030043) but are likely to become more active in opposition when the commission adopts it as expected next week, lawmakers and observers said in interviews. Congressional Democrats have been comparatively active since the draft’s release, including sending Rosenworcel suggestions aimed at preventing loopholes that ISPs could use to circumvent regulation. Congressional Democrats highlighted that divergence in style Thursday by bringing Rosenworcel to Capitol Hill for a news conference that amounted to a preemptive victory lap ahead of the FCC’s April 25 vote on the order.

Florida will join other states that designate mobile phone providers as eligible telecom carriers (ETCs) for the federal Lifeline program. Also, the state will extend a pole attachments promotion that lets ISPs pay $1 a year per wireline attachment per pole to bring broadband to unserved or underserved areas in municipal electric utility service territories. Gov. Ron DeSantis (R) signed the wireless ETC (SB-478) and pole-attachments (HB-1147) bills on Monday. The bills became law Tuesday. Under SB-478, Florida will transfer wireless ETC designation powers from the FCC to the Florida Public Service Commission (see 2403050070). Meanwhile, HB-1148 will extend the pole-attachment promo until Dec. 31, 2028. It would have expired July 1 this year. Other state broadband bills also advanced this week. The Louisiana House voted 101-0 to pass a bill (HB-700) updating rules for the state’s Granting Unserved Municipalities Broadband Opportunities program. The bill addresses data reporting, award distributions, penalties and unobligated funds. It will go to the Senate. In Colorado, the Senate voted 31-1 to pass a bill (HB-1234) to indefinitely prolong the state’s high-cost support mechanism, which provides subsidies to a dozen rural telecom providers and is scheduled to sunset Sept. 1. The Appropriations Committee advanced the bill unanimously on Friday (see 2404120013). The House previously passed the bill but would have to agree with Senate changes before HB-1234 can go to Gov. Jared Polis (D). On Tuesday, the Vermont House passed a bill (S-199) updating merger rules for communications union districts (CUDs), groups of two or more municipalities that build infrastructure in rural parts of the state. The Senate passed the bill Feb. 28, but it still needs gubernatorial OK.

Possibly facing the end of the federal affordable connectivity program (ACP), the California Public Utilities Commission should quickly modify grant rules to ensure service stays affordable, said The Utility Reform Network in petitions Friday and Monday. “We don’t have the luxury of time here,” said TURN Telecom Policy Analyst Leo Fitzpatrick in an interview Monday. The state cable association slammed TURN’s proposals. But the California Emerging Technology Fund (CETF), a group that has led efforts to sign up low-income Californians for ACP, supports having “another opportunity to discuss the imperative for California to have a back-up plan to replace the” federal program, said CEO Sunne Wright McPeak in an email Monday.