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New York Throttles FCC Repeal of Net Neutrality January 2018

New York Throttles FCC Repeal of Net Neutrality

By Patricia Fahy, NYS Assemblymember, 109th District (D-Albany)

The stratospheric growth of the internet in the past few years has transformed our society and our economy. Free and open access to the internet has connected individuals throughout the world, fueled economic growth and progress, all while transforming entire industries such as technology and communications, healthcare, education, and transportation. The internet is now an essential part of everyday life for entrepreneurs, businesses, workers, students, educators, and more.

Unfortunately, last December, the Federal Communications Commission (FCC) voted to abandon net neutrality principles, tossing out protections put in place to keep a level playing field for all internet content providers. In response, I introduced legislation to maintain these principles in New York by leveraging the state “purse” to enforce net neutrality protections for consumers, entrepreneurs, and businesses, all of whom depend on reliable, rapid, and affordable access to the internet. Since then, Governor Cuomo has issued an executive order driving home this same point; internet access is an essential tool and New York should not do business with those who seek to impede access to it.

Net neutrality principles protected some of the most basic expectations about the internet, including quick access to virtually limitless content. The FCC repeal of these net neutrality principles opens the doors for Internet Service Providers (ISPs) to engage in practices like prioritization of paid content, slowing down (or throttling) other content, creating internet “fast lanes” and “slow lanes,” or even blocking some content altogether.

Thankfully, this federal repeal has been met with strong public opposition. A University of Maryland poll in December noted a whopping 83 percent of Americans are in favor of net neutrality.

Trying to address telecommunications issues requires states to carefully thread the needle. The federal Communications Act of 1934 gives the federal government broad authority to regulate telecommunications. The states do have discretion, however, on how to direct taxpayer dollars. Since states are also some of the largest consumers of internet services, my bill contends New York has the ability to choose to award state and municipal contracts in a way that suits the interests of its citizens.

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This January, Governor Cuomo announced his use of the power of the state purse by issuing an executive order modeled after my legislation (A.8882/S.7183). I’m advocating passage of this legislation to permanently enshrine net neutrality principles in statute. The bill, sponsored with Senator David Carlucci, directs New York’s Public Service Commission (PSC) to establish a process to certify that internet service providers are following net neutrality principles in order to be eligible for state contracts. In order to make these certifications, the PSC will use federally mandated reporting requirements on net neutrality, which require ISPs to publicly disclose practices such as throttling or paid prioritization. Using these federally mandated reporting requirements will allow New York State to avoid federal preemption problems by avoiding any need for the state to directly regulate ISPs.

This measure will use New York’s power as a large consumer of internet services to encourage ISPs to abide by net neutrality principles. State contracts include those with school districts and municipalities as well as state agencies. These are some of the most lucrative, predictable sources of income for enterprises of all kinds, including internet service providers. Telling ISPs that are noncompliant that they cannot contract with New York sends a strong message to shareholders.

New York is not alone in this approach. Montana's governor recently signed an executive order that requires ISPs with state contracts to abide by core net neutrality rules. Lawmakers in California, Rhode Island, Nebraska, Washington, and Massachusetts have proposed similar bills.

Presently, we’re still waiting for the FCC’s order to be implemented. In New York, the potential damage from this policy and the increased level of control it gives ISPs to regulate content could have a devastating and long-term impact. Consumers, small businesses, the tech industry, schools, and libraries all stand to suffer. We must continue to promote the democratization, not the commercialization, of the internet.

In the era of “fake news,” the ability to freely access information online is essential for reporters and voters alike. When consumers pay for internet services, they expect that those services will be rendered fairly, an issue already complicated by a severe lack of competition among ISPs. In many parts of Upstate New York, many consumers have only one or possibly two ISPs to choose from. With the repeal of net neutrality, consumers in rural (and even some urban) areas may literally be given the option to access a watered-down version of the internet or to forgo internet services altogether.

Small businesses are among the most vulnerable to the FCC’s net neutrality repeal. Our “main street” businesses risk being given a one-two punch in the form of paid prioritization and throttling. If ISPs choose to prioritize paid content, businesses will either have to pay to get their products in front of consumers, or be left in the dust in internet “slow lanes.” For a multinational company paying these fees may be a nominal expense; however, small businesses often operate with tight profit margins. Adding additional paid prioritization charges to make sure consumers see their content is too high of a burden. With the repeal of net neutrality, the options for the ISPs do not just stop at the ability to prioritize paid content — they also would have the ability to slow down websites for businesses that do not pay through throttling. This would amount to digital extortion and threatens small business everywhere.

Schools and libraries are also put at risk by the repeal of net neutrality. Whether it’s for developing lesson plans or finding educational resources to explain complicated subjects, access to the internet has dramatically improved K-12 education in the last decade. The internet helps level the playing field for all students, whether they’re in a rural or urban district or a wealthy or poor district. Libraries depend on net neutrality, too: 33 percent of African American and Latino families and 25 percent of all families making less than $50,000 a year depend on libraries as their primary connection to the internet. This effectively tells those families the FCC ruling could limit their access to information. These resources are now free, as they should be, but if ISPs have the ability to prioritize paid content, we’re really at risk of undermining the quality of education for students, particularly low-income students.

For states trying to address this issue, the road forward is unclear. The law in this area is truly at a new frontier of regulation. One argument being made here, and in states such as California and Washington, is that the FCC does not have the authority to preempt states because of certain legal changes made in the FCC’s recent ruling. Even if that is the case, a court may ultimately have to decide if and to what extent states have the right to override the FCC. While I commend the states and the attorneys general seeking judicial answers to these questions, limiting state contracts is a way to quickly mitigate the impact of this ruling in an already existing legal framework.

Technology issues have always been a “catch up” game for government; thirty-seven years passed between the invention of the telephone and the adoption of the first regulations. While states grapple with the impact of the repeal of net neutrality, we have lots of catching up to do. The rise of the internet should not be “throttled,” yet the repeal of net neutrality practically gives ISPs a permission slip to roll back much of its benefit. Consumers, small businesses, and students are being left at the mercy of ISPs and their shareholders. Since Congress has failed to overturn this harmful FCC ruling, we will continue to fight for state legislation to protect the internet for all New Yorkers in order to ensure it continues fueling essential job growth, educational opportunity, and entrepreneurial innovation.


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The Nelson A. Rockefeller Institute of Government, the public policy research arm of the State University of New York, conducts fiscal and programmatic research on American state and local governments. It works closely with federal, state, and local government agencies nationally and in New York, and draws on the State University’s rich intellectual resources and on networks of public policy academic experts throughout the country.