Most anyone who’s moved to a new apartment has had the same experience: whatever broadband provider everyone else in the building has, you have. This kind of lock-in could become less common if a new proposal from the FCC is adopted, preventing revenue-sharing between providers and building owners and opening the door to competitors.
It’s largely because of the cost of wiring a building that an address tends to be served by a single broadband provider. And while investments should be rewarded to a certain extent, ISPs have found ways to keep strangleholds on whole neighborhoods.
Sometimes they’re (technically) above-board, like an agreement with a big apartment complex where the building management gets kickbacks. And sometimes they’re loopholes in existing rules, where an ISP arranges things so that it would be prohibitively expensive for a competitor to share infrastructure.
The new proposal, circulated internally today by FCC Chair Jessica Rosenworcel but summarized in a release, would prevent or mitigate some of these dirty tricks. It would ban revenue sharing agreements outright, require other arrangements (like marketing) to be disclosed to tenants, and close loopholes that allow wiring to be effectively exclusive when it is meant to be leased or shared.
“With more than one-third of the U.S. population living in apartments, mobile home parks, condominiums, and public housing, it’s time to crack down on practices that lock out broadband competition and consumer choice,” said Rosenworcel. “Consumers deserve access to a choice of providers in their buildings. I look forward to having my colleagues join me in lifting the obstacles to competitive choice for broadband for the millions of tenants across the nation.”
The Commission recently began looking into the issue, opening a comment period and investigating the evidence — not surprisingly, they found “a pattern of new practices that inhibit competition, contrary to the Commission’s goals, and limit opportunities for competitive providers to offer service for apartment, condo and office building unit tenants.”
Rosenworcel’s current proposal is the result of this — not a sweeping new rule but a bit of problem solving aimed squarely at bad faith activity commonly undertaken by ISPs. The proposal will be made public at some point ahead of the FCC’s vote — and even if that was tomorrow, there would likely be a considerable grace period before any of these shady arrangements are revised. So if you’re hoping to switch providers soon somewhere you’ve got no choice… keep hoping. But maybe next year.
