Trump's team asserts that Internet Service Providers (ISPs) are the ones who decide what counts as 'affordable' high-speed internet.

Trump's team asserts that Internet Service Providers (ISPs) are the ones who decide what counts as 'affordable' high-speed internet.

In a significant development for the broadband industry, the latest updates to the Biden Administration's Broadband Equity, Access, and Deployment (BEAD) program have made it clear that states are not allowed to impose price caps or rate controls on Internet Service Providers (ISPs) participating in the program.

According to the National Telecommunications and Information Administration (NTIA), which oversees the BEAD program, states may not enforce laws like New York’s Affordable Broadband Act, which capped prices for low-income households. This move comes as a shift from the Trump administration's guidance on the BEAD program, which did not consider it the responsibility of ISPs to define what constitutes "affordable" service for rural broadband deployment funds.

The NTIA's latest FAQ, updated on Tuesday, indicates that BEAD funds are contingent on states not imposing fee schedules on ISPs. This means ISPs themselves determine what constitutes a "low-cost" broadband plan without state-imposed price caps.

The BEAD Notice of Funding Opportunity (NOFO) displays various disclosure requirements, such as all-inclusive pricing and basic service characteristics. However, it is still an open question whether the NOFO mentions price restrictions for the low-cost service option. The Trump Administration criticised the BEAD NOFO for setting rates only by displaying examples, and the new stance prohibits states from explicitly or implicitly setting prices for the low-cost service option in the program's terms.

Under the current program rules, states must ensure low-income households have access to eligible low-cost plans, but they cannot mandate the pricing themselves. An example from the NOFO suggests a proposed service option cost $30 a month or less and have download/upload speeds of 100 Mbps and 20 Mbps or "the fastest speeds the infrastructure is capable of."

Interestingly, only one state, New York, currently has a law requiring large ISPs to offer cheap internet service. However, under the BEAD program, this law would not apply to ISPs participating in the program.

This policy change is part of the Infrastructure Investment and Jobs Act (IIJA), which explicitly prohibits the government from setting broadband rates that it considers affordable for low-income access. The IIJA called for creating the BEAD program, but the affordability portion of the program is not subject to regulation by states imposing price caps on ISPs.

[1] NTIA BEAD FAQ: https://www.ntia.gov/broadband-infrastructure/bead-program/faq [2] IIJA: https://www.congress.gov/bill/117th-congress/house-bill/3684/text [3] New York Affordable Broadband Act: https://www.nysenate.gov/legislation/bills/2021/S5915 [4] Trump Administration's BEAD program guidance: https://www.fcc.gov/reports-research/reports/broadband-deployment-report/2020/broadband-deployment-report-2020 [5] NTIA warning on state rate caps: https://www.ntia.gov/blog/2022/ntia-warns-states-not-impose-rate-caps-bead-program

1. The Biden Administration's Broadband Equity, Access, and Deployment (BEAD) program restricts states from imposing price caps or rate controls on Internet Service Providers (ISPs) participating in the program, as outlined in the NTIA's latest FAQ.
2. Under the current program rules, states must ensure low-income households have access to eligible low-cost plans, but they cannot mandate the pricing themselves, according to the BEAD Notice of Funding Opportunity (NOFO).
3. The Infrastructure Investment and Jobs Act (IIJA), which created the BEAD program, explicitly prohibits the government from setting broadband rates for low-income access, thereby excluding states from imposing price caps on ISPs.

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