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California’s Net Neutrality Plan Adds Exceptions Sought by the Telecom Industry

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Aaron Pressman
Aaron Pressman
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By
Aaron Pressman
Aaron Pressman
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June 20, 2018, 5:29 PM ET
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California’s effort to revive strict net neutrality rules for the Internet hit a roadblock on Wednesday. The legislative proposal to reinstate—at least for California residents—the 2015 federal online anti-discrimination protections was amended to add multiple exceptions that Internet service providers had been seeking.

The California bill was taken up by the state Assembly’s Committee on Communications and Conveyance on Wednesday afternoon. At that point, it was amended to add exceptions to the net neutrality protections. For example, ISPs would be allowed to charge fees to websites in some cases, slow the traffic of specific categories of apps, and exempt their own content from monthly data caps, a practice known as “zero rating.” The bill could face further changes as it continues to move through the legislative process.

Until Wednesday’s changes, California’s net neutrality proposal was considered potentially the strongest in the nation. Washington state passed a law in March that closely followed the prior federal rules adopted during the Obama administration which barred ISPs from blocking or throttling online content and prohibiting prioritizing some content over others for money. Montana issued an executive order in January requiring Internet service providers with state contracts to abide by similar rules. A large group of states are also suing the Trump administration’s Federal Communications Commission over the decision to rescind the rules last December.

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Net neutrality proponents expressed their dismay at Wednesday’s changes to the California proposal, known as Senate Bill 822.

“The level of corruption we just witnessed literally makes me sick to my stomach,” Evan Greer, deputy director of Fight for the Future, said in a statement. “Californians should rise up and demand that at their Assembly members represent them. The actions of this committee today are an attack not just on net neutrality, but on our democracy.”

Sen. Scott Wiener, who authored the original bill, agreed that the changes wrecked the sought-after Internet protections. “”If California passes a weak, watered-down, ineffectual net neutrality bill, that sets a terrible standard not just for other states but for the federal government,” he told the Associated Press after the hearing.

The changes weren’t enough to gain the support of the telecom industry, either. In a statement, the California Cable and Telecommunications Association and CTIA, the national telecom industry group, called the bill “poorly conceived” and stated their continued opposition. “Unfortunately, SB 822 – and the proposed amendments – would inhibit investment and innovation in California,” the groups wrote. “What the country needs is permanent bipartisan federal legislation that will benefit consumers and ensure consistent rules of the road for all companies and across all websites.”

Assemblyman Miguel Santiago, who chairs the committee, issued a statement that didn’t address the amendment.

“California should once again stand as a back-stop of ‘the resistance’ by beating back both the Trump’s Administration and the billion-dollar corporations he’s trying to protect,” he wrote. “Because of that, I stand firm in recommending the 2015 Obama FCC rules on net neutrality as they were included in Senate Bill 822 this morning.”

The goal of the rules is to protect consumers who may want to access content via the Internet from Netflix (NFLX), Spotify (SPOT), or another provider without allowing their ISP, such as Verizon (VZ) or Comcast (CMCSA) to block or charge more for reaching those services.

(Update: This story was updated on June 21 to add an industry statement and a comment from a lawmaker.)

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