FCC Proposal Aims to End ISP Lock-Ins in Apartment Complexes

Broadband Competition in Multi-Dwelling Units: A Potential Shift

Many individuals relocating to new apartments encounter a common situation: being limited to the single broadband provider already serving the building. This lack of choice could be altered with a new proposal from the Federal Communications Commission (FCC). The proposal aims to prevent revenue-sharing agreements between providers and building owners, thereby fostering a more competitive landscape.

The High Cost of Infrastructure

The primary reason for this limited competition is the substantial cost associated with wiring a building for broadband access. While investments in infrastructure deserve recognition, ISPs have often exploited this to maintain exclusive control over entire neighborhoods.

These practices range from legitimate, though questionable, agreements to outright loopholes. Some arrangements involve building management receiving financial incentives, while others create infrastructure barriers that make it financially unfeasible for competitors to enter the market.

FCC Proposal to Promote Competition

A new proposal, initiated by FCC Chair Jessica Rosenworcel, seeks to address these issues. The proposal, detailed in a recent release, would prohibit revenue-sharing agreements and mandate transparency regarding marketing arrangements with tenants.

Furthermore, it aims to close existing loopholes that allow for effectively exclusive wiring arrangements when the infrastructure is intended to be leased or shared. This would ensure fairer access for competing broadband providers.

Rosenworcel's Statement

“With more than one-third of the U.S. population residing in apartments, mobile home parks, condominiums, and public housing, it’s time to address practices that stifle competition and limit consumer choice,” stated Rosenworcel. “Tenants deserve the ability to select from multiple providers within their buildings. I anticipate support from my colleagues in removing these obstacles to competitive choice for broadband access across the nation.”

Investigation and Findings

The FCC recently initiated an investigation into this matter, opening a public comment period and analyzing the available evidence. The investigation revealed “a pattern of new practices that inhibit competition, contrary to the Commission’s goals, and limit opportunities for competitive providers to offer service for apartment, condo and office building unit tenants.”

Looking Ahead

Rosenworcel’s proposal is a targeted response to these findings, focusing on addressing bad faith activities undertaken by ISPs. The proposal will be publicly released prior to the FCC’s vote.

Even with a swift vote, a grace period will likely be implemented before existing arrangements are required to be revised. Therefore, those hoping to switch providers in buildings with limited options may need to remain patient, though improvements could be seen in the coming year.