Computer companies are warning about the impacts of new California laws regarding online content moderation, data privacy and more targeted to go into effect at month’s end — including that the rules could become a revenue generator for local governments rather than a transparency generator for social media users.

The California laws regulate devices and features while cracking down on underage users on certain sites. The Computer and Communications Industry Association (CCIA) said the laws, with stiff penalties for violators, could stifle innovation — a familiar complaint about regulation in general — while likely conflicting with other laws and the U.S. Constitution.   

One of the new laws the CCIA has issues with requires social-media companies to post much more specific information on their privacy policy as part of their terms of service, including policies on “specified categories of content” and how they are moderated.

“[D]igital services providers already take aggressive steps to moderate dangerous and illegal content, consistent with their terms of service,” the CCIA told the state back in July.

CCIA offered up a parade of potential horribles should the bill and its provisions make it into law. "[R]ather than protecting consumers from harmful content, they might have the adverse unintended consequence of giving nefarious foreign agents, purveyors of harmful content and other bad actors a playbook for circumventing digital services’ policies.”

The CCIA also suggested the bill could become a new source of revenue rather than of greater transparency, given that the revenue from penalties levied on violators of the tougher requirements would be divvied up between the city and county treasurers. 

“This provision creates a punitive financial incentive for district, county and city officials to seek out formalistic violations in order to supplement local resources, while not necessarily supporting efforts to increase transparency,” the tech industry group said. ▪️

The Federal Communications Commission has taken no official position on whether California’s $0 co-pay policy for mobile carriers applying for its California LifeLine low-income subsidy is statutorily impermissible rate regulation, but its amicus brief in a challenge to that law in a federal appeals court does everything but that. 

Commercial broadband operators, fixed and mobile, are constantly on guard for what they see as government rate regulation by proxy and the FCC’s brief did nothing to allay those concerns.

One section of the Communications Act says states can adopt regulations “not inconsistent with the FCC’s rules” to advance the government's interest in universal service. Another says states can’t regulate the rates charged for mobile services although they can regulate “terms and conditions” and take steps to ensure “universal service at affordable rates.”

The issue before the 9th U.S. Circuit Court of Appeals is whether the $0 co-pay is allowed by the first section or pre-empted by the second, the FCC points out.

The FCC first throws up its hands, saying: “(The FCC) has never addressed whether states may advance universal service by requiring wireless providers to offer minimum service standard plans with a $0 copayment as a condition of receiving state subsidies through a voluntary program like California LifeLine. For that reason, the FCC writes in support of neither party.”

The FCC then puts both thumbs on the scale for a reading that supports the $0 pay policy. That’s no big surprise, since the Biden administration has made it clear it sees price as a factor in universal availability.

The FCC keeps its official hands off the decision by using words like “might” and “may.”

It says, for example, given “statutory text, context and common sense,” the state’s policy ”might not ‘regulate’ rates” in the sense used in the statute. It said many FCC orders have held that state regulations that indirectly affect rates are not pre-empted and “may’ be analogous to the California rule.

The FCC also holds that certain state regulations, including rate regulations, are exempted “once wireless service has ‘has become vital to universal service.‘ “ 

”Because the parties have not litigated this case under that universal service exception, the FCC asks the Court to take care not to cast doubt on California’s ability to avail itself of [that holding] in a future proceeding should California choose to re-enact a $0 co-payment requirement,” the regulator said. ■

Some Democrats were agreeably disagreeing Wednesday (July 20) over a proposed bipartisan comprehensive federal data privacy regime.

The differences came to light during a House Energy & Commerce Committee markup of the American Data Privacy and Protection Act. The bill, which ultimately passed out of committee 53-2, would require companies to collect only the data necessary to provide their products or services, bill proponent Common Cause said, and would allow consumers to correct or delete their data. There are also prohibitions on discriminatory data practices, algorithms and ad delivery.

The bill has supporters on both sides of the aisle and in both houses of Congress, which is saying something in these politically divided times, particularly on an issue as complicated as data privacy protection.

But not everyone was singing kumbaya.

Also: ISPs, Edge Providers Oppose California Privacy Law

Rep. Anna Eshoo (D-Calif.), who was one of the two no votes, said that her home state already has the best privacy protections in the country, including inalienable rights to access personal information, delete information and stop its sale. California residents may also opt out of automated decision-making and limit the use of sensitive information.

Eshoo said she was concerned the bill would threaten those privacy rights and protections because it does not enshrine protections already in state law. She said she understood industry concerns about not creating a patchwork of regulations, but said there is a history of Congress leaving stronger protections in place when “practical and compatible,” as she suggested was the case with California’s privacy law.

“State progress” should be preserved, she said, as the Health Insurance Portability and Accountability Act of 1996 (HIPAA) does in not overriding state health information protections, or as civil-rights law does in protecting state laws on the matter.

Eshoo said the legislation also has a loophole that would allow law enforcement to go after the private data of women seeking abortions in the post-Roe v. Wade world. She also pointed to the strength of California's privacy law enforcement, with an expert agency focused on preventing the misuse of information. She said the federal bill would compromise California's ability to enforce the law.

The law would be an improvement for much of the country, she argued, but she could not say the same for her constituents in California.

Eshoo’s fellow California Democrat, Rep. Scott Peters, saw it quite differently. He applauded the bill as a bipartisan, comprehensive bill that was of paramount importance.

Peters agreed with Eshoo that California had led the way with its privacy bill, saying the state law had served as inspiration for the federal bill.

He said he recognized the concerns of Eshoo and others and that, ideally, it would take even more of the California law. But he said there needed to be one standard so that businesses know what their rights and responsibilities are, which means the federal standard would necessarily have to preempt various state standards.

Peters also pointed out that without that preemption, the bill would not be bipartisan.

He said there were at least three important aspects of the bill that provided at least as much protection as current law.

Peters said the bill has landmark data-minimization protections that go beyond “failed notice and choice regimes,” as well as robust anti-discrimination protections.

For example, he said, while California law requires kids under 15 to get permission from their parents before they can be targeted with online advertising, the federal legislation flat out prohibits such targetting for anyone under 17. The federal bill also creates a Youth and Marketing Division at the FTC.

“There is no state law in California or elsewhere that protects kids as much as this bill does,” he said.

The committee voted down an Eshoo amendment that would have allowed state laws with stronger privacy protections to remain on the books, but, interestingly, Peters voted for the Eshoo amendment despite his recognition that state laws needed to be preempted in the federal bill. ▪️

Internet service providers have dropped their challenge of a U.S. District Court’s ruling upholding California’s network neutrality law.

The state adopted the California Internet Consumer Protection and Net Neutrality Act of 2018 (SB 822), prohibiting blocking, throttling and paid prioritization, after the Federal Communications Commission eliminated its similar net neutrality rules and reclassified internet access as a Title I information service under Trump-era chairman Ajit Pai.

The ISPs had already lost a federal district court challenge to the law and two appeals court efforts to block enforcement.

A three-judge panel of the U.S. Court of Appeals for the 9th Circuit had denied the request of ACA Connects, NCTA, CTIA and USTelecom for an injunction of enforcement of the California law while their underlying challenge was appealed. The ISPs then asked the full 9th Circuit to review that panel decision, a request that was denied.

It is the underlying challenge to the initial district court ruling, and thus to the law, that the ISPs have now dropped, according to court documents. The suit was dismissed without prejudice, which means ISPs could refile it if they chose.

The Republican Trump administration had also challenged the California law in court, but the Biden administration withdrew that — Democratic President Joe Biden is a net neutrality rule fan.

ISPs had argued that California‘s adoption of net neutrality rules were preempted by the FCC‘s decision to roll back its own rules against blocking, throttling and paid prioritization, which had prompted California to create similar rules to fill what it saw as a regulatory void.

Also: ACA Connects Makes Its Case Against California Net Neutrality Law

The three-judge 9th Circuit panel (Judges Mary M. Schroeder, J. Clifford Wallace and Danielle J. Forrest) — one of the most liberal circuits in the federal appeals court system — had agreed with the federal district court that the FCC lacked the authority to preempt the state law because in reclassifying internet access as an information service under Title I of the Communications Act, the FCC no longer had the authority to regulate the internet in the way it did when broadband was a Title II telecommunications service.

The panel pointed to the U.S. Court of Appeals for the D.C. Circuit‘s decision upholding the FCC’s Title I reclassification, but also striking down an accompanying order asserting the reclassification preempted state net neutrality rules.

The 9th Circuit panel also had rejected the ISPs’ contention that the California law was preempted because it conflicted with the underlying FCC policy or because interstate service was the sole province of federal law.

“The ISPs threw in the towel today on their challenge to California’s net neutrality law,” said Andrew Jay Schwartzman, senior counselor to the Benton Institute for Broadband & Society, one of those defending the law before both the federal district court and the 9th Circuit. “Realizing that they could not successfully appeal the January 2022, decision of the U.S. Court of Appeals for the Ninth Circuit to the Supreme Court, the ISPs gave up. They were forced to accept what most observers had seen: in the wake of the Federal Communications Commission’s decision disclaiming interest in treating broadband access service as subject to federal regulation, the states were freed to adopt their own requirements.

“Several other states have adopted net neutrality requirements by statute or executive order. The reasoning of the 9th Circuit court allows those provisions to remain in effect as well,” he said, adding: “The end of this litigation is a boon for free speech, competition and innovation on the internet.” ■

Cable and telecom internet service providers, wired and wireless, have signaled they will be filing an appeal by Friday (February 11) of a lower court decision not to block enforcement of California's net neutrality rules, asking a full complement of U.S. appeals court judges to review a panel decision that went against them.

According to a document filed with the U.S. District Court for the Eastern District of California, "by February 11, 2022, plaintiffs/appellants will be filing a petition for rehearing en banc [by the full court] in their appeal of the Court’s February 23, 2021 Order before the 9th Circuit."

Those plaintiffs/appellants are ACA Connects, CTIA, NCTA–The Internet & Television Association and USTelecom.

Cable ISPs had asked the 9th Circuit to overturn a U.S. District Court‘s decision not to grant a preliminary injunction against the California Internet Consumer Protection and Net Neutrality Act.

ISPs had argued that California‘s adoption of rules was preempted by the FCC‘s decision to roll back its rules against blocking, throttling and paid prioritization, which had prompted California to create similar new rules of its own to fill what it saw as a regulatory void.

Also: ACA Connects Makes Its Case Against California Net Neutrality Law

Two weeks ago, the lower court decision to allow the rules to go into effect while the underlying challenge works its way through the courts was upheld by a panel of the 9th U.S. Circuit Court of Appeals.

The three-judge 9th Circuit panel (Judges Mary M. Schroeder, J. Clifford Wallace and Danielle J. Forrest) — one of the most liberal circuits in the federal appeals court system — agreed with the district court that the FCC lacked the authority to preempt the state law because in reclassifying internet access as an information service under Title I of the Communications Act, the FCC no longer had the authority to regulate in the way it did when broadband was a Title II telecommunications service.

The panel pointed to the U.S. Court of Appeals for the D.C. Circuit upholding the FCC reclassification but striking down the accompanying order asserting preemption of state net neutrality rules.

Also: California Net Neutrality Law Victory Draws Crowd

The 9th Circuit panel also rejected the ISPs’ contention that the California law was preempted because it conflicted with the underlying FCC policy or because interstate service was the sole province of the federal law. ■

A federal appeals court has refused to block enforcement of California‘s network neutrality rules, which internet service providers are challenging.

Cable ISPs — including those represented by ACA Connects and NCTA-the Internet & Television Association — had asked the 9th U.S. Circuit Court of Appeals to overturn a District Court's decision not to grant a preliminary injunction against the California Internet Consumer Protection and Net Neutrality Act.

But the three-judge 9th Circuit panel (Judges Mary M. Schroeder, J. Clifford Wallace and Danielle J. Forrest) — one of the most liberal circuits in the federal appeals court system — instead upheld the lower court.

Also: ACA Connects Makes Its Case Against Calfornia Law

ISPs had argued the California law was pre-empted by the Federal Communications Commission's 2018 decision to eliminate rules against blocking, throttling and anticompetitive paid prioritization, a move that had prompted California to create rules of its own.

The appeals court agreed with the district court that the FCC lacked the authority to pre-empt the state law because in reclassifying internet access as an information service under Title I of the Communications Act, the FCC no longer had the authority to regulate the way it did when it was a Title II telecommunications service.

It pointed to the U.S. Court of Appeals for the D.C. Circuit upholding the FCC reclassification but striking down the accompanying order asserting pre-emption of state net neutrality rules.

Also: California Net Neutrality Law Victory Draws Crowd

The 9th Circuit panel also rejected the ISPs’ contention that the California law was pre-empted because it conflicted with the underlying FCC policy or because interstate service was the sole province of the federal law.

The underlying case against the California law has yet to be adjudicated. This ruling only settled whether enforcement should be delayed until the underlying ISP challenge is resolved.

“Like a lot of 9th Circuit decisions, it is arguable that the court got the law wrong regarding whether California's net neutrality law is pre-empted," Randolph May, president of the market-oriented think tank Free State Foundation. “Given the inherently interstate nature of today’s tightly integrated broadband internet networks, there’s a good chance that other circuits might reach a different conclusion regarding pre-emption. But the risks of Internet service providers being subjected to a legacy common carrier regulatory regime established initially to regulate railroads in the 19th century and then Ma Bell last century, and a patchwork of varying state regulatory regimes with different mandates, should prompt Congress to resolve the decades-old net neutrality controversy by adopting a new law that prevents consumer harm while recognizing the technologically dynamic nature of today’s Internet ecosystem." 

Also joining the ACA Connects appeal were CTIA, representing wireless ISPs, and USTelecom, representing telecom ISPs.

They can appeal the panel decision to the full court if they choose.

“Today is a great day for the free and open internet," said California Democrat Rep. Anna Eshoo (D-Calif.), a big supporter of net neutrality rules. "The Ninth Circuit Court of Appeals upheld California’s net neutrality law, the strongest in the nation, a major win for small businesses and internet users across my state,” said Eshoo. “A free and open internet is critical for innovation, free expression, and our economy. Now Congress and the FCC should follow California’s lead and expand net neutrality to all Americans as I’ve advocated for years.” ■ 

Almost three dozen shows spotlighting diversity and inclusion from noncommercial KCET Los Angeles and PBS SoCal will air on the TV stations and stream via the free PBS Video App in celebration of Black History Month in February.

Those include 17 new shows, originals and episodes of PBS series, including American Experience, American Masters, Finding Your Roots and The Migrant Kitchen.

The goal, said the stations, is to "actively promote a more inclusive and equitable future for all," with stories about diverse voices and historic moments.

Among the offerings: American Masters Marion Anderson: The Whole World in Her Hands, about the singer best known for her Freedom Concert on the steps of the Lincoln Memorial after she was denied the use of Constitution Hall because of her race; American Experience's The American Diplomat about three African American ambassadors representing a country abroad that continued to, discriminate against them at home; and Broken Bread, an original KCET series about social justice issues through the lens of food and its power to counter the forces of gentrification.

Others spotlighted during the month include Jesse Owens, Muhammad Ali and Fannie Lou Hamer. ■

ACA Connects made its case to a federal appeals court Tuesday (Sept. 14) that broadband providers should not face a “patchwork of conflicting state regulations” on broadband access, including to a majority of judges who said they had issues with how the FCC reclassified broadband as an information service and pre-empted state regulation that differed from that approach.

Also Read: Net Neutrality Goes Back to Court in California

That came in oral argument in the 9th U.S. Circuit Court of Appeals in ACA Connects v. Rob Bonta. The trade group representing smaller, independent cable operators had challenged a lower court's refusal to grant it a preliminary injunction blocking California's network neutrality law, the California Internet Consumer Protection and Net Neutrality Act of 2018.

California's bill was a response to the Federal Communications Commission's 2017 decision under Republican chairman Ajit Pai to eliminate the FCC's open internet rules and reclassify access as an information service under Title I of the Telecommunications Act of 1996 not subject to common carrier rules.

The ACAC case was heard by a three-judge panel of the court, Judges Mary M. Schroeder, J. Clifford Wallace and Danielle J. Forrest.

Also Read: California Net Neutrality Law Victory Draws Crowd

The state of California vigorously defended the law against what it said was an FCC policy decision that did not square with statute.

ACAC's lawyer, Scott Angstreich of Kellogg Hansen, told the court that providers faced the prospect of 50 different sets of rules for streaming Netflix shows or accessing Zoom calls or relaying national news to customers in different states.

Angstreich said that the FCC concluded that Title I is the best regime for ensuring an open internet and that, further, using a Title II common-carrier regime would harm the internet.

He pointed out that the court has already found that when the FCC regulates interstate services (such as broadband access) under Title I, the regulation of intrastate services, like broadband in California only, is pre-empted if it undercuts that federal regime. ACAC argues the California rule does just that, since it imposes the same rules the FCC found harmed an open internet when it classified broadband access as a Title I service.

Judge Schroeder said she was struggling with what FCC pre-emption authority flows from simply reclassifying a service.

Angstreich said the FCC had the authority to figure out the best way to regulate broadband, and chose the best statutorily sound way to do that, including the pre-emption of intrastate regulation that conflicted with its approach.

Judge Forrest said she was also struggling. She said she didn't read the statute as meaning that deciding which category to put a service in was a policy choice.

Judge Schroeder pointed out that California has other consumer protection statutes. Supposing the court agreed that the net neutrality statute is pre-emptive and someone sued a provider who tried to block access or unfairly charged for access in a way that violated consumer protection laws as an unfair business practice, she asked, would that also be pre-empted?

Angstreich said current consumer-protection laws enforce promises by broadband providers, and that if they promised not to block and did, enforcement would not be pre-empted. What would be pre-empted, he said, would be regulating access differently from the federal regime, as California is trying to do.

Judge Wallace suggested that rather than continue the preliminary injunction, the appellants might want to simply press for a decision on the underlying case, then seek a permanent injunction, pointing out that the judges' time is limited.

Angstreich said that because the preliminary injunction was denied, his clients are facing the very harms it identified in seeking that injunction, so waiting until the final judgment creates “real and pressing” harms.

At least in terms of pre-emption questions, ACAC says there is no factual development left on that issue “and the harm persists,” Angstreich said.

Patty Lee, the lawyer for California, defended the law and its prevention of blocking, throttling and some paid prioritization, which are the practices the FCC’s scrapped net neutrality rules prevented.

Without those “essential protections,” she said, broadband providers can “discriminate against content providers they disagree with or charge them fees for reaching internet users.”

Lee also said that case law did not support pre-emption unless backed by ancillary authority, authority which she said the FCC did not sufficiently establish.

She invoked the COVID-19 pandemic to argue that no one can doubt the value of an open internet with so many people online. Immediate access to information, like on California wildfires, can be a matter of life and death, she said.

To that point, she argued that states are the primary protectors of their citizens' health and safety and don't need “prior federal authorization” to do so, “especially when it comes to a basic necessity like access to the internet.”

She said there was no conflict between California's law and the FCC’s 2018 order reclassifying the internet under Title I and eliminating the rules against blocking, throttling and paid prioritization.

Asked by Judge Schroeder about the policy issue, she said the FCC's decision might reflect policy, but that does not mean the decision has pre-emptive effect, which flows from the statute and not the policy. Under Title I, she said, both the FCC and the states have the authority to regulate broadband.

Schroeder said if the court concluded it was a policy decision, there would be a direct conflict because there is a totally different policy approach, i.e. no need for bright-line rules against blocking, throttling and paid prioritization (FCC), versus a definite need for bright-line rules (California).

Lee said that an agency can't regulate — and certainly can’t pre-empt — on policy preferences alone. She said the classification decision should not be a way to get around the statutory language that says the FCC only has ancillary regulatory authority under Title I.

Schroeder asked if Lee thought there was any way the FCC could take a deregulatory approach to internet regulation that would pre-empt state efforts to do the opposite.

Lee said that the agency could reclassify broadband access under Title II, though she conceded that comes with regulations that "generally should be imposed on common carriers," then forbear from enforcing some of those rules.

In effect, Lee was suggesting that the prior approach of net neutrality regulations under Title II with forbearance of rate regulation, among other things, was that deregulatory approach — something ISPs would definitely take issue with.

In rebuttal, Angstreich said the 9th Circuit has already held that the FCC can pre-empt under Title I, including state laws that get into the FCC's intrastate regulatory lane.

"When a state copies the FCC's definition and tries to regulate the exact same service as the FCC in a way that the FCC has held is harmful to broadband deployment, and unnecessary to internet openness," he told the court, "it is pre-empted."

ACAC had no comment on the oral argument.

"It is always dangerous to draw broad inferences from oral argument, especially when there is only 15 minutes per side," said veteran attorney Andrew Jay Schwartzman, “but the panel did seem skeptical about the pre-emptive effect of the FCC's action in light of the Mozilla holding.”

With the war on the pandemic still not won, California’s veterans are at risk of losing access to a mobile internet app, called VA Video Connect, that enables veterans to receive telehealth services without incurring data usage charges. This is a consequence of California’s newly effective "net neutrality" law that flatly prohibits Internet service providers from offering consumers so-called "free data" plans, sometimes also called "sponsored data" or “zero-rated” offerings, unless an entire “category” of supposedly similar services receives the same treatment. 

While government-imposed “net neutrality” mandates may sound superficially appealing in theory, in reality they often harm consumers. In this instance, those harmed may include our veterans.

With free data offerings, access to various Internet content, such as the VA’s telehealth application, is subsidized by the wireless broadband providers or by third party websites and applications. As a result, consumers receive a price break or avoid potential data usage charges. Not surprisingly, the free data programs are popular with consumers, and low-income persons naturally stand to benefit the most. 

For now, California's net neutrality law is the most overreaching in the nation. Its threatened harmful effects should be a cautionary tale, not only for other states, but for the Federal Communications Commission, which likely is considering adopting similar new prohibitions governing Internet service provider offerings. 

According to a March 24 report in Politico, “officials at the Department of Veterans Affairs are privately sounding the alarm that California's new net neutrality law could cut off veterans nationwide from a key telehealth app.” The reason California’s ban on free data offerings likely will impact vets and consumers across the nation is that, unlike traditional voice telephone calls in last century’s analog era, it is highly impractical and burdensome, and in some instances impossible, to segregate interstate and intrastate Internet traffic. Thus, Internet providers, such as AT&T, T-Mobile, Tracfone, and Verizon, that offer the VA Video Connect app, almost always implement uniform nationwide protocols. 

Why would California threaten to make it more costly – and, therefore, more difficult – vets to take advantage of an innovative telehealth program by banning the wireless carriers’ free data programs? Simply put, because of an overly rigid ideological view of what “net neutrality” means. The most rabid net neutrality proponents, including Big Tech companies, persuaded California's legislature that it's somehow wrong for Internet service providers to allow certain content websites and applications, such as the VA’s in this case, to bear some small portion of the massive costs of constructing and operating broadband networks, rather than having consumers bear the entire costs. 

In this view, popular free data offerings supposedly constitute an invidious form of non-neutral “discrimination.” According to this theory, there could be an adverse impact on websites and applications that don’t themselves offer free data programs. An outright ban on these offeringssupposedly protects hypothetical competitors from hypothetical injury from hypothetical discrimination. 

If banning free data apps is a core "net neutrality” principle, then it's one that deserves to be jettisoned. In the technologically dynamic, rapidly evolving, competitive Internet ecosystem, Internet service provider practices should not be categorically restricted based on hypothetical harms. In the real world, free data programs are popular and benefit consumers. The VA Video Connect app is a prime example of such a consumer benefit. 

In light of the embarrassment caused to California by the potential take-down of the VA’s telehealth app, it will not be surprising if the state’s officials reach some interpretative accommodation that creates a “free data” exemption for certain applications, say, those relating to government-provided telehealth applications or “telehealth” sites more generally. That will be good for veterans and perhaps others. 

But the uncertainty that already has been created just serves to illustrate the harm all too likely to ensue when government diktats put Internet service providers into straight jackets that require regulatory contortions to remedy the consumer harm the diktats create in the first place. A regime that requires the government to define and approve specific categories of acceptable websites and apps invites arbitrariness, manipulation, and favoritism. 

The far better course is for Congress, the FCC, and the states to adhere to a policy grounded in Internet freedom that presumptively permits innovative services such as VA Video Connect and other free data offerings. In the event any specific claims are raised that consumers and competition are being harmed, those concerns can be addressed on a case-by-case basis by the Federal Trade Commission or Department of Justice.

Randolph May is President of the Free State Foundation, a think tank in Rockville, Maryland, and Seth Cooper is a Senior Fellow. They are co-editors of the book, A Reader on Net Neutrality and Restoring Internet Freedom.

*This piece was originally published on Real Clear Markets.

Net neutrality fans inside the Beltway are celebrating a Judge's decision to allow California's net neutrality law to go into effect.

The law passed the California legislature, but enforcement had been delayed until the legal challenges from the Trump Justice Department--the Biden Justice Department withdrew its challenge--and ISPs.

“This is a long-overdue victory for the open internet and California’s right to protect consumers online," said Joshua Stager, senior counsel at New America's Open Technology Institute. "Sacramento legislators passed a net neutrality law in 2018 to ensure that Californians get the internet service they paid for without unreasonable interference from their provider. We look forward to this law finally taking effect to help the millions of Californians who need the open internet to get through ongoing public health, economic, and climate crises. It’s time for the federal government to restore net neutrality for all Americans.”

“With this ruling, we hope the law can finally see the light of day in California and begin protecting consumers online immediately. This ruling is a win for both consumers and the open internet," said Jonathan Schwantes, senior policy counsel for Consumer Reports. "This will hopefully encourage other states to follow California’s lead to explore their own net neutrality laws until the federal government can move forward with a national set of net neutrality rules, either through legislation or regulation.”

"Telecom lobbyists used every dirty trick in the book to try to kill off California’s gold standard net neutrality law," said Evan Greer, deputy director of Fight for the Future. "And they still lost. That’s because net neutrality is one of the most popular policies of the last century. Now we’re one step closer to net neutrality being the law of the land. The Biden administration should act quickly to appoint a net neutrality champion (with no ties to the telecom industry) to the FCC, and Congress should pay attention to what happened in California, and ensure that any future legislative protections are at least as good as California’s law..."

Also Read: OTI Says DOJ Should Drop California Net Neutrality Law Challenge

Greer said she didn't want "our cable and phone companies controlling what we can see and do on the Internet, or killing off startups to solidify the monopoly power of Big Tech giants."

Interestingly, it is Big Tech edge players like Google and Facebook and Twitter that are currently Congress' biggest focus when it comes to killing off startups and consolidating monopoly power, rather than the ISPs who historically drew those criticisms.

High-speed broadband deployment advocacy group Next Century Cities wants the governor to bring the California legislature back for a special session to consider a broadband bill, SB1130.

Under current law, California's broadband deployment plan is that no later than Dec. 31, 2022, the state will approve funding for infrastructure projects "that will provide broadband access to no less than 98% of California households."

Related: California Mandates Close to Digital Divide

The new law would stretch that timeline by two years, but up the ante on what broadband must be deployed. "[N]o later than Dec. 31, 2024, [the state shall] approve funding for infrastructure projects that will provide high-capacity [25 mbps downstream and 25 mbps upstream], future-proof infrastructure, as defined, based on current engineering and scientific information available at the time of program application, to no less than 98% of California households, with a latency that is sufficiently low to allow real-time interactive applications to unserved areas and unserved high-poverty areas, and provide last-mile infrastructure to unserved areas and unserved high-poverty areas."

Next Century Cities argues that the bill is needed to "ensure that California residents have the requisite connectivity to remain safe and fully recover from the pandemic."

"NCC urges the California Governor to reconvene the legislature to evaluate whether SB1130 could help local governments that are working to meet their communities’ broadband needs," it said in a letter Tuesday (Oct. 6) to California governor Gavin Newsom.

Computer companies are telling a California District Court that it should deny an effort by the Trump Administration to block California's tough new net neutrality law from going into effect.

The law was passed after the FCC's Restoring Internet Freedom (RIF) order scrapped its net neutrality rules banning blocking, throttling and paid prioritization.

In an amicus brief filed this week, the Open Technology Institute told the court that telecom companies have "a long history of violating net neutrality and haven't performed well during the COVID-19 pandemic."

The FCC's RIF deregulation of internet access included a preemption of state regs that conflicted with that decision. But California passed its own tough net neutrality rules anyway to fill what it saw as a regulatory void.

The government is seeking a preliminary injunction to block California from being able to enforce the law. OTI said that injunction should be rejected.

ACA Connects and other ISP organizations have filed similar motions to put the California law on hold.

The California law was passed in 2018, but its implementation was stayed pending the ultimate legal determination on the FCC's RIF order--federal appeals court upheld the majority of the decision exactly one year ago (Oct. 1, 2019).--as well as various motions in the California district court.

California Attorney General Xavier Becerra has filed the state's opposition to the Trump Administration's request for a preliminary injunction to block California's net neutrality law from going into effect.

Enforcement is "on hold," as Becerra's office points out, until the U.S. Court of Appeals for the Eastern District of California rules on the various motions.

Related: California's Net Neutrality Challenged

The FCC's deregulation of internet access included a preemption of state regs that conflicted with that decision. But California passed its own tough net neutrality rules to fill what it saw as a regulatory void.

The government is seeking a preliminary injunction to block California from being able to enforce the law. In 2018, California agreed not to enforce its own state net neutrality law until a final court decision on the FCC repeal.

ACA Connects and other ISP organizations filed similar motions to put the California law on hold.

The California filing this week argues that the FCC had no authority to either preempt state net neutrality laws or to impose a federal access deregulatory policy binding on the states.

There is a high bar for an injunction, and AG Becerra said the FCC has failed to meet that bar, including that allowing the law to go into effect would cause irreparable harm.

By contrast, the state told the court, barring enforcement of its net neutrality law would be particularly harmful given how important a free and open internet is during the pandemic and wildfires, where alerts and public evacuations increasingly depend on the internet.

Meanwhile, Vermont Attorney General T.J. Donovan has agreed to hold off net neutrality litigation in that state pending a decision in the California case.

Ad agencies are pushing back hard on a California bill that could extend liability for defective products to advertising agencies.

According to the Association of National Advertisers (ANA) and other ad associations, a California consumer protection product liability bill was amended this week to include provisions they said thwart the stated intent of the bill to exempt online advertising from liability exposure.

The American Association of Advertising Agencies (4A’s), the American Advertising Federation (AAF), ANA, the Interactive Advertising Bureau (IAB), and the Network Advertising Initiative (NAI) said the bill would chill commercial speech and reduce the availability of digital content at a time when the economy "is already under significant strain." They did not mention the COVID-19 pandemic, but obviously that is the current major strain, as well as the reason availability of digital content in a work-and-study-and-play-from-home is even more important.

The bill, as amended, "could create the broadest expansion of strict liability requirements in U.S. history, radically depart from existing jurisprudence, and subject small businesses to crippling financial exposure,” said Dan Jaffe, group EVP of government relations for ANA.

They are principally concerned with an amendment adding the provision that the bill covers businesses “facilitating the placement of products into the stream of commerce," without defining what facilitating constitutes. They fear that could that it could apply to any business deriving a direct or indirect financial benefit from products that were deemed effective.

They are concerned about what was taken out as well as added. They says another amendment removed a provision "clarifying that fees received for advertising do not constitute a 'financial benefit from the sale of the defective product.'" Without that, ad dollars are clearly at risk from "defective" products.

“The most recent amendments impose draconian potential penalties on publishers," said IAB EVP for public policy, Dave Grimaldi. "To avoid potential liability, a publisher would either need to test and evaluate each product for defects prior to allowing advertising for the product or significantly limit advertising on its site. This would reduce resources for publishers to provide digital news, content, and online services.”

“The broad and undefined language in this amendment could expand the law’s scope beyond a merchant selling a good to cover a news organization or Mommy blogger than runs a single ad and a product reviewer who receives high traffic to an article reviewing a product that is later deemed to be defective,” said Alison Pepper, EVP of government relations for 4A’s.

California's governor is mandating that his state close the digital divide.

Governor Gavin Newsom has issued an executive order "directing state agencies across government to bridge the digital divide" with a focus on connecting students trying to keep up their studies during the pandemic.

The order includes the creation of a state Broadband Action Plan, a directive that connectivity should be at a minimum 100 Mbps download speeds, and that California conduct its own broadband mapping initiative to identify where broadband is and isn't.

The FCC is coming up with its own regime for better mapping broadband availability, conceding the criticisms from many quarters, including both sides of the aisle on Capitol Hill, that its broadband mapping has been deficient.

Newsom said this week that the state budget is divvying up $5.3 billion in "learning loss mitigation funds" among every local educational agency to support distance learning.

"Because this pandemic has an inequitable impact on communities – including a digital divide in access to technology necessary for distance learning," said Newsom's office, the majority of that money (81%) is targeted to students with the greatest need--low income.

Newsom's new aspirational-sounding statewide requirements, include 1) "Access to devices and connectivity for all kids; "daily live interaction with teachers and other students; "challenging assignments equivalent to in-person classes; "adapted lessons for English-language learners and special education students."

Results from the Trump Administration's most recent internet use study concluded that "a persistent digital divide still exists based on income levels, age groups, and race, among other factors."

California’s net neutrality law should be blocked because federal law pre-empts the state statute, the U.S. Justice Department argued in asking a federal judge to overturn a state law reviving many tenets of the FCC’s 2015 Open Internet Order.

The Justice Department said federal statutes pre-empt the net neutrality law passed in California’s capitol.

ACA Connects and other ISP organizations filed similar motions to put a hold on California enforcement of state law SB 822, the California Internet Consumer Protection and Net Neutrality Act, which they said conflicts with the 2018 Restoring Internet Freedom Order, the benchmark rule of the early Ajit Pai FCC.

The government is seeking a preliminary injunction to block California from being able to enforce its law. In 2018, California agreed not to enforce its own state net neutrality law until a final court decision on the FCC repeal.

The Justice Department did not reply to a Multichannel News request about the timing of the Aug. 5 court challenge.

The California attorney general's office said it is reviewing the Justice Department's filing "and look[s] forward to defending California’s state net neutrality protections," according to a Reuters report. Large tech companies and consumer groups have embraced the California law. The court schedule may mean there will be no decision on the Justice Department request until October.

Meanwhile, Vermont Attorney General T.J. Donovan has agreed to hold off net neutrality litigation in that state pending a decision in the California case, according to ACA Connects. The association and other organizations entered a stipulation last week to stay enforcement of the Vermont law pending further discussions between the groups and Vermont officials.

California has brought together some cross-sector partners, including Verizon and T-Mobile, to help it deliver distance learning services and devices to over 70,000 students to help bridge the digital divide, according to Gov. Gavin Newsom. 

Among the initiatives are a funding infusion of $30 million from the California Public Utilities Commission to provide internet access and computing devices. 

"It’s inspiring to see parents, teachers, businesses and philanthropy step up to meet this moment and provide tools to help bridge the digital divide and get more students connected," said the governor. 

According to Newsom, one in five students lack either high-sped internet or the appropriate device. In low-income neighborhoods, according to a survey of parents, half don't have the laptop or tablet to access distance learning from a hotspot. 

Newsom earlier in the month called for businesses to step up, and he said they did.  

Those include: 

1. "T-Mobile is donating 13,000 tablet devices, in addition to the previously-announced 100,000 hotspot devices (for which they partnered with Google.) 

2. "Amazon is donating 10,000 tablet devices. 

3. "Apple is actively working with 800 districts across the state, offering free coaching sessions to teachers to help them with the transition to remote learning. In addition, Apple is offering special pricing for iPads with cellular, and has given the equivalent of 9,000 iPads to ensure the most vulnerable in our state have access. 

4. "Verizon is partnering with the State of California to provide 250,000 students with unlimited Internet service at a discount." 

The FCC has been seeking distance learning funds in COVID-19 aid legislation. The first CARES Act aid bill was focused on telehealth funding, for obvious reasons since mitigating the spread of the pandemic is job number one.

The Trump Administration's response to Gov. Jerry Brown's signing Sunday (Sept. 30) of California's tough new net neutrality law was swift and definitive: Justice is suing the state. But there was plenty of other reaction to the effort to re-regulate broadband access in the face of the FCC's order that such efforts were preempted.

“While not surprising, California’s net neutrality effort reaffirms its leaders’ total lack of understanding of how technology or our economy actually works, particularly its ban on paid prioritization," said FCC commissioner Michael O'Rielly, who voted to deregulate ISPs and eliminate the rules against blocking, throttling and paid prioritization. "If allowed to stand, the law would be incredibly detrimental to American consumers and the continued growth of the Internet. Thankfully, this is precisely why our nation’s founding fathers crafted a Commerce Clause to the U.S. Constitution and why I pushed so hard for the Commission’s December action to include strong preemption provisions. The DOJ’s action to challenge this overreach is both appreciated and appropriate."

Democratic commissioner Jessica Rosenworcel, who strongly opposed the elimination of the rules, saw it a lot differently, and tweeted her thanks to the governor.

[embed]https://twitter.com/JRosenworcel/status/1046554401647841281[/embed]

“The enactment of California’s net neutrality law is a huge victory for the free and open internet,” said Sen. Ed Markey (D-Mass.). “California has shown Washington and the rest of the country that the internet warriors fighting to save net neutrality will not be stopped."

The Taxpayers Protection Alliance argues that new net regs will leave taxpayers on the hook as the feds and states battle it out in court using taxpayer dollars. Then there is the less free data and reduced investment, which it says will not benefit the state's "struggling households." Paid prioritization is a way for companies to subsidize bandwidth use for a particular service, which supporters like the alliance say is consumer-friendly and opponents say is a way to favor one service over another, which isn't neutral.

"[P]assing massive and intrusive internet regulations means fewer options for consumers and internet providers," said Taxpayers Protection Alliance president David Williams. "[T]outed by the law’s backers will be few and far between. Recent data from the Wehe app shows that, even in the post-Title II world, throttling is rare and used solely for network management."

Demand Progress and Public Knowledge, some of net neutrality rules' biggest backers, were celebrating Sunday.

"This is a big day for net neutrality," said Robert Cruickshank, campaign director at Demand Progress. "Gov. Jerry Brown has just restored a free and open internet to the 40 million people of California — the world’s fifth largest economy and home to many major tech companies. This law passed with a large bipartisan majority thanks to an unprecedented outpouring of community activism the likes of which Sacramento has not seen for some time. We now urge the U.S. House of Representatives, especially members representing California, to quickly sign the discharge petition and force a vote to use the Congressional Review Act to restore net neutrality for all 50 states.”

"As is often the case, California is setting a strong example for Congress and other states on the type of net neutrality protections an overwhelming majority of Americans expect," said Public Knowledge VP Chris Lewis. 

"Only in Washington D.C. is this controversial due to the influence of broadband provider lobbyists. Even in California, that influence was strong, but an outpouring of support from consumers and small businesses helped to remind policymakers just how popular net neutrality protections are."

The Writers Guild of American West was also pleased. Content creators are concerned about distributors having too much power over the internet, which they see as an alternative to traditional video distribution channels already controlled by consolidated companies. 

Related: Amazon Slams California Privacy Law

"Once enacted, this landmark net neutrality legislation will serve as a model for states nationwide to follow," said the guild. "The Internet today is where we connect, where we organize and speak freely, and where we can choose what content we consume. With increasing attacks on our First Amendment rights and widespread corporate concentration, preserving an open Internet free from ISP interference is more important now than ever.”

U.S. Telecom, which represents ISPs, called for a 50-state legislative framework for protecting net neutrality. “We all support strong and enforceable net neutrality protections for every American – regardless of where they may live," said USTelecom president Jonathan Spalter. "But this bill is neither the way to get there, nor will it help advance the promise and potential of California’s innovation DNA," he said. "Rather than 50 states stepping in with their own conflicting open internet solutions, we need Congress to step up with a national framework for the whole internet ecosystem and resolve this issue once and for all.”

"This is a true grassroots victory," said California-based progressive group. CREDO Action. "Today, Californians won out against one of the most powerful lobbies in Sacramento. AT&T and other Big Telecom companies opposed this bill with everything they had. Thanks to hundreds of thousands of activists who would not give up the fight against all odds, Californians will have real, meaningful net neutrality protections. We thank Gov. Brown for standing with us and protecting the future of the internet and all our communities who depend on it."

The bill does not go into effect until 2020.

The California Legislature's Communications Committee has passed SB 822, a strong network neutrality bill that would restore rules against blocking, throttling and paid prioritization that the FCC rolled back in June, and then some (it prevents zero rating plans and applies rules to interconnections, which the FCC rules did not do).

The bill had already been amended and passed by the same committee, but activists had complained those changes, which included allowing zero rating plans, had gutted, or at least strongly watered down, the legislation. Under pressure, that language was ultimately restored and the re-vote for this week scheduled.If it passes the full assembly, it could set up a legal confrontation with the FCC, which says its rollback preempts state net neutrality reg efforts.

Related: Tough California Net Neutrality Bill Revived

The Aug. 22 vote came after dozens of people came to the hearing room microphone to express their strong feelings about the bill. Among those in support were the California Association of Realtors, ACLU, Green Party, California Clean Money Campaign, Writers Guild of America West, ADT Security Services, Santa Clara Board of Supervisors, Next Gen California.

Among those on the other side, which was a much shorter line, were AT&T, Sprint, the California Chamber of Commerce, Verizon, Consolidated Communications, T-Mobile, Comcast, California Manufacturers & Technology Association, Cox.

An AT&T representative told the committee that the bill's restoration of a zero rating prohibition would hurt low income and minority consumers. It also took issue with the bill's application of the rules to paid interconnections, which the FCC did not even do in its 2015 Open Internet order, though it did apply Title II for the first time and say it would look at issues on a case-by-case basis.

AT&T called it a radical departure from the historic internet rules in place since the Clinton Administration. He said SB 822 was anticompetitive and anticonsumer and that it would be challenged under the FCC's federal preemption. He said it would drive up prices and drive out popular free data programs and increase litigation costs.

He said the bill is built on speculation that someone, somewhere, sometime might violate net neutrality principles that are already enforceable by the California attorney general, the Federal Trade Commission and FCC.

The California Cable & Telecommunications Association said part of the reason it opposed the rules was that the state was exceeding its authority because the internet was an interstate service and that a patchwork of state legislation would impose operational burdens and "significant legal challenges.

A separate bill, SB 460, which requires that contractors for government communications services comply with the new net neutrality rules, also passed.