FCC adopts rules prohibiting ‘digital redlining’

The Federal Communications Commission on Wednesday approved new rules on broadband companies aimed at ending a practice known as digital redlining.

Advocacy groups including the National League of Cities have long raised concerns that internet service providers offer faster and more reliable broadband service in wealthier communities than in lower-income ones while charging the same price. Under the new rules, the FCC now has the power to bar providers from deploying, upgrading or maintaining broadband service in a way that discriminates against lower-income people.

But possible loopholes are leading some to be cautious in their reactions. The new rules only prohibit discrimination that is “not justified by genuine issues of economic or technical feasibility.” Both consumer groups and the broadband industry have said they are unclear what that means.

Harold Feld, senior vice president of the broadband advocacy organization Public Knowledge, said that "it’s really going to depend on the first couple of actions to see how the commission interprets the rules.”

In addition to prohibiting digital discrimination, the rules create a process where anyone can file a complaint saying they are being discriminated against. 

FCC Chairwoman Jessica Rosenworcel told Route Fifty at a press conference after the vote that the rule is not retroactive and the goal is to prevent redlining in the future. “We’re adopting the rules on a forward-looking basis,” she said.

Gerard Lederer, a broadband expert who works with local governments, praised the new rules as a “major improvement” in dealing with the concerns raised by cities.

Though internet service providers have strongly denied the allegations of discrimination, the National League of Cities in February urged the FCC to create the rules, calling it a “critical opportunity to address the historic inequities that have been perpetuated by discriminatory broadband buildout, maintenance or upgrade, and marketing.”

Now that the FCC has done so, Lederer said cities can urge the federal government to step in and prevent inequities they see in the service their low-income communities are getting. “That wasn’t even in the game before,” he said.

The vote comes after Congress in the 2021 infrastructure act required the commission to create rules that prevent digital discrimination. However, a group of 28 Republican senators led by Ted Cruz of Texas wrote Rosenworcel last week saying that the rules go beyond what Congress intended in the law. The rules are “heavy-handed Internet regulation and expose every nook and cranny of the broadband business to liability,” the senators wrote. As a result, they “will create crippling uncertainty for the U.S. broadband industry, chill broadband investment and undermine Congress’s objective of promoting broadband access for all Americans.”

Rep. Yvette Clarke, a New York Democrat who pushed for the infrastructure act to address digital discrimination, disagreed.

“The bipartisan infrastructure law made clear that equal access to broadband is a must for everyone everywhere,” she said at a press conference celebrating the FCC vote. “Even as the digital industry exploded, America lived with a digital divide. The inability to access broadband puts many essential services out of reach. In the pandemic, we witnessed everything from the inability to access telehealth services to millions of children across this nation struggling to log in to their classrooms.”

Rosenworcel before the vote called the infrastructure act, “the first bipartisan civil rights law focused on the digital age.”

But in voting against the rules, FCC Commissioner Brendan Carr, who was appointed during former President Donald Trump’s term, said the move was an effort by the Biden administration to increase government control.

“For the first time ever, those rules would give the federal government a roving mandate to micromanage nearly every aspect of how the Internet functions—from how [internet service providers] allocate capital and where they build, to the services that consumers can purchase; from the profits that ISPs can realize and how they market and advertise services to the discounts and promotions that consumers can receive,” he said. “Every decision from the C-suite to the call center will be subject to FCC second-guessing.” 

Broadband industry groups, including NCTA — The Internet & Television Association, have also come out against the rules calling them a “regulatory sea change” in their comments to the FCC last week. 

Broadband companies, which are expected to challenge in court any attempt by the FCC to implement the rules, have argued they should only be held accountable if they intentionally try to discriminate against low-income communities. The FCC says there is no evidence that they have.

The FCC, though, agreed with others, including the National League of Cities, who argued that companies should be held accountable if there is inequity, regardless of whether the companies intended it. 

“Our rules would miss the mark if they cover just discriminatory intent because we would fall short of meeting our statutory obligation to ‘facilitate equal access’ to broadband,” Rosenworcel said at Wednesday’s meeting.

Rosenworcel, though, said at the meeting that the FCC will “accept genuine reasons of technical and economic feasibility as valid reasons why it may not be possible for equal access to a provider’s network. We will review those defenses carefully and thoughtfully on a case-by-case basis.”

Asked later at the press conference, Rosenworcel added that Congress “thought we should be reasonable. We should make sure that companies, if they wanted to defend their practices, should be able to demonstrate that there was a genuine issue of technical or economic feasibility that would lead them to make their deployment choices.”

Still, groups like NCTA — The Internet & Television Association want more clear guidance on what the FCC expects of providers. The group wrote the FCC last week urging the agency to give “providers clarity on permissible (or impermissible) behavior” by creating “guideposts for what would not constitute digital discrimination.”