Starting today (January 15), service providers with over 20,000 subscribers in the state of New York must offer broadband for no more than $20 per month.
The Affordable Broadband Act, passed in 2021 under former Governor Andrew Cuomo, mandated that ISPs offer qualifying low-income households monthly broadband rates of $15 for 25 Mbit/s service, or $20 for 200 Mbit/s. The law was put on hold following court challenges brought by ISP groups, including ACA Connects, CTIA, NTCA, the New York State Telecommunications Association, Satellite Broadcasting & Communications Association and USTelecom. But after a federal appeals court upheld the ABA last year, and the Supreme Court subsequently declined to hear the case in December, the state can now officially enforce the law.
Exceptions apply: Service providers with under 20,000 subscribers may be exempt from the law if compliance would cause "unreasonable or unsustainable financial impact on the broadband service provider," according to the state.
Those smaller ISPs must alert the state by today (January 15) to receive a temporary exemption, and must then follow up with additional financial information by February 15, 2025, to demonstrate that "unreasonable or unsustainable" impact.
'Watershed moment'?
Related:ISP groups renew ACP push as New York mandates $15 broadband
New York's ability to require low-income broadband services arrives after 1.7 million households in the state lost access to subsidized services through the Affordable Connectivity Program (ACP). The ACP, a federal program that provided a monthly $30 subsidy for roughly 23 million low-income US households, ran out of funding in May 2024.
"For this reason, consumer benefit programs assisting low-income households – such as the ABA – are even more critical to ensure that the digital divide for low-income New Yorkers is being addressed," said New York's department of public service in its recent order reopening proceedings on the ABA.
To that end, some in the industry expect other states will follow in New York's footsteps.
In a note last year for New Street Research, telecom industry analyst and former FCC official Blair Levin said the New York law "paints a path that other states will look at" without the availability of the ACP.
"In a world where the federal government is subsidizing low-income households for $30 a month, states did not need to take action to address low-income broadband affordability," he said. But without that subsidy, "states may try to assist low-income households to keep them connected," Levin added.
Indeed, the industry groups that fought the New York law appear fearful of that exact outcome.
Related:2024 in review: RIP ACP and WTF USF
After a federal appeals court upheld the ABA last year, the industry groups on the losing end of the ABA case turned to Congress to, unsuccessfully, push for the ACP's renewal: "We urge Congress to maintain support for low-income Americans on a nationwide basis," wrote the groups.
And in their reply brief unsuccessfully asking the Supreme Court to step in last year, the New York State Telecommunications Association and co-petitioners further warned that the ABA taking effect would be a "watershed moment": "Many state legislators and bureaucrats would surely then follow New York's lead," stressed the groups.
Time will tell. But several states have at least indicated a desire to leave that regulatory door open.
After the industry trade groups sued New York in 2021, and a judge issued a temporary injunction of the law, 22 states supported New York in appealing the injunction. In their own brief at the time, those states (including California, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington and Wisconsin, plus the District of Columbia) told the court that the industry groups' argument opposing the New York law would "undermine the states' abilities to protect their residents."