Despite the Federal Communications Commission's suspension of efforts to regulate broadband internet service, state laws remain intact in California, New York and elsewhere.
The 6th U.S. Circuit Court of Appeals decision this week striking down the FCC's open internet rules has little impact on state laws enacted during the years-long tug-of-war over the government's power to regulate internet service providers, telecommunications experts said .
In fact, some said the Cincinnati-based 6th Circuit's decision — along with other rulings and the U.S. Supreme Court's stance on a separate case in New York — effectively bolstered state regulators' efforts to close the loophole.
“Without an action from Congress, the FCC has virtually no role in broadband,” Ernesto Falcon, program manager for the California Public Utilities Commission, said in an interview. “The result of this decision is that states like California, New York and others will have to manage and regulate broadband providers themselves.”
California has one of the strictest net neutrality laws in the country, the principle that Internet traffic must be treated equally to ensure a free and open network. Former Gov. Jerry Brown signed the measure in 2018, months after federal regulators in President-elect Donald Trump's first administration repealed net neutrality rules put in place under President Obama.
Colorado, Oregon and other states have also adopted their own standards.
The Golden State law has already survived legal challenges. It also led to changes in the way internet service providers offered plans and services.
“California’s net neutrality law, considered the gold standard by consumer advocates, has nationwide implications,” Falcon said.
The law, known as the California Internet Consumer Protection and Net Neutrality Act (formerly California Senate Bill 822), blocks anticompetitive practices that the state deems harmful to consumers.
These measures include slowing or throttling traffic speeds by Internet providers. It also prohibits some forms of “zero-rating,” an industry term for when a company exempts a select service from data caps.
After the California law went into effect, telecommunications giant AT&T ended its practice of offering the Max streaming service to its phone customers without counting the usage toward a customer's data cap. Streams from other services – those not owned by AT&T – counted toward the cap. The practice was seen as a way to lock consumers into their AT&T phones.
The first Trump administration sued to block California's law, delaying implementation for several years.
But after President Biden took office in 2021, his administration abandoned its efforts to distort California law.
An industry association that represents broadband providers took up the matter. The group ACA Connects sued California Atty. Gen. Rob Bonta is seeking an injunction to prevent the law from taking effect.
But courts rejected those legal efforts, and the California-based 9th U.S. Circuit Court of Appeals upheld the state law three years ago.
“The state laws were all followed,” said John Bergmayer, legal director of the consumer advocacy group Public Knowledge, which advocates for an open Internet.
Last April, the FCC tried to reinstate Obama-era rules to create a national standard.
The FCC sought greater oversight to force internet providers to respond to service outages or security breaches. The FCC also cited national security interests and said stronger oversight is needed for the commission to effectively crack down on foreign-owned companies deemed a security threat.
But three 6th Circuit judges ruled unanimously Thursday that the FCC overstepped its authority when it sought to reclassify broadband services as “telecommunications” services, which are subject to stricter federal regulation under the Communications Act of 1934 and the Telecommunications Act of 1996 .
The ruling did not address state net neutrality laws.
Blair Levin, a former senior FCC official and policy adviser to New Street Research, said: “The new decision keeps the door open for government action.”
Additionally, Levin said the 9th Circuit found that the FCC's actions did not prevent states from taking separate actions.
He and other legal experts also pointed to the U.S. Supreme Court's refusal to hear a challenge to a New York law that requires internet service providers to offer low-income broadband services at a speed and price set by the state.
Because the Supreme Court skipped this case, the New York law stands. This could lead to further government action, the analysts said.
“The state’s authority and role in broadband access has now grown dramatically,” Falcon said.