Broadband Providers Continue to Push Back on Bulk Billing Ban

Digital Inclusion

The proposal, first announced in March, has not been released publicly.

Jake Neenan Broadband Providers Continue to Push Back on Bulk Billing Ban Photo of Hotwire CEO Kristin Johnson from the company

WASHINGTON, May 29, 2024 – Broadband providers are continuing to push the Federal Communications Commission to change course on its proposal to ban bulk billing arrangements in apartment buildings.

Those are agreements between building owners and providers to give bulk service to tenants, who are then billed for their share of the total cost. FCC Chairwoman Jessica Rosenworcel argued in announcing her proposal that bulk billing deals are ultimately bad for consumers because they lock tenants into signing up with a certain ISP.

Rosenworcel’s announcement came in March, and the item has not been circulated publicly yet, but opposition has been consistent among housing groups and broadband providers. They’ve been asking the FCC to pump the brakes and open an inquiry into the consumer effects of bulk billing agreements rather than take comment on a proposal to ban the practice.

Florida-based ISP Hotwire Communications, one of the first entities to write the agency with concerns about the proposal, secured a May 17 meeting with Rosenworcel to reiterate its position that bulk billing agreements enable lower prices for individual consumers. 

The company largely serves members of home and condominium owners’ associations, with whom Hotwire negotiates, and has told Rosenworcel’s legal team that residents in those communities pay “approximately 50%” less for broadband from the company than they otherwise would. A flurry of Florida HOAs wrote to the agency last week with similar arguments.

Hotwire’s CEO Kristin Johnson expressed to Rosenworcel “serious concern that regulatory actions targeting bulk billing arrangements, such as an outright ban or opt-out requirements, would undermine these benefits and negatively impact consumers,” according to an ex parte filing

A group of competitive providers calling themselves the Coalition of Independent Broadband Bulk Providers wrote the agency earlier this month describing similar savings for their customers. The group, which claimed its members only provide service through bulk agreements, asked the FCC to take input on whether a potential ban should apply to competitive providers as well as incumbents.

Other smaller providers have been weary though. Colorado-based Intrepid Fiber Networks told commission staff in a May 24 letter that it’s been effectively locked out of apartment buildings due to bulk billing arrangements. WISPA, which represents small and wireless providers, has told the agency its members have had similar experiences.

Consumer advocacy group Public Knowledge has not been convinced by provider arguments. The group met with commission staff last week to point out the agency has heard similar lines before, when it sought in 2022 to ban exclusive revenue sharing agreements between landlords and providers. 

Just like in that instance, Public Knowledge argued, landlords and HOAs can in some cases negotiate better terms for tenants through bulk billing. But the practice can also be “used to preserve an in-building monopoly at the expense of the tenants” when competition is available, the group wrote.

“The Commission found that the interest in promoting competition and the benefits of competition for [apartment] tenants and consumers as a whole outweighs the potential benefits of permitting exclusive agreements or permitting arrangements that the Commission found recapitulated exclusive agreements,” Public Knowledge wrote. “There is no reason to reach a different conclusion here.”

The group pushed the agency to move forward and “add questions that may have emerged as a result of the recent barrage of presentations” to its proposal. The item is not on the agenda for the FCC’s June meeting, but if it were approved in the future it would open a comment proceeding on the issue.