California’s Rental Fee Law Sparks ISP Backlash
▼ Summary
– California Gov. Gavin Newsom signed a bill to increase broadband competition in apartment buildings, rejecting opposition from cable and real estate industries.
– The new law, effective January 1, requires landlords to let tenants opt out of paying for third-party Internet services offered in bulk-billing arrangements.
– The bill passed with strong legislative support, including a 75–0 Assembly vote and a 30–7 Senate vote, and does not ban bulk billing but mandates opt-out rights.
– Opponents, including cable and real estate lobby groups, argued the law undermines cost savings and could phase out bulk billing, calling it anti-affordability.
– The bill’s author stated it aims to promote fairness and competition, with support from smaller Internet service providers, addressing a gap in federal rules.
A new California law set to take effect on January 1 aims to reshape how broadband services are offered in apartment buildings, giving tenants greater control over their internet expenses. Governor Gavin Newsom signed the legislation despite strong opposition from cable providers and real estate groups, framing it as a move to enhance competition and fairness in the rental market. The bill, which passed with overwhelming bipartisan support, requires landlords to allow residents to decline bundled internet services without penalty.
Under the new rules, tenants can opt out of paying for third-party internet, cellular, or satellite subscriptions included as part of their lease agreement. This applies even when services are offered through bulk-billing arrangements, where a single provider supplies connectivity to an entire building. The law does not prohibit bulk billing outright, but it ensures residents have the freedom to choose, and pay for, only the services they want. Supporters argue this will prevent renters from being locked into costly or subpar internet plans.
Assemblymember Rhodesia Ransom, the bill’s author, described the legislation as a moderate but meaningful step toward fairness. She emphasized that the measure is not intended to eliminate bulk billing or limit profits for providers or landlords. Instead, it focuses on consumer choice. Ransom noted that smaller internet service providers backed the proposal, seeing it as a way to challenge the dominance of larger companies in multi-unit housing.
Opponents, including the California Broadband & Video Association, have sharply criticized the law, labeling it an “anti-affordability bill disguised as consumer protection.” Cable industry representatives warned that refunding tenants who decline bundled internet could undermine the financial model behind bulk billing, potentially leading to its elimination. They contend that such arrangements typically offer lower rates due to economies of scale and that allowing opt-outs could reduce savings for everyone.
The California law addresses a regulatory gap at the federal level, where no comparable tenant protections exist for bulk-billed communications services. By giving residents the right to refuse included services, the state hopes to foster a more competitive broadband marketplace. While real estate and telecom lobbyists worked aggressively to block the bill, its decisive passage suggests strong political consensus around expanding tenant rights in an increasingly connected world.
(Source: Ars Technica)
