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California’s net neutrality bill could set a national standard

Or unleash a series of lawsuits

Photo by Amelia Holowaty Krales / The Verge

If the California net neutrality bill passes through Assembly, the state’s size and influence on the market might make it the new broadband standard nationwide.

The bill, S.B. 822, is one of the most comprehensive measures any state has put forward in the six months following the FCC’s vote to roll back the original Obama-era regulations. If it passes, it would be the third state to enact net neutrality rules and the first to prohibit some zero-rating programs.

California’s bill follows the successes of both Oregon and Washington in passing their own state net neutrality rules. If it’s enacted, the whole West Coast would be banning contracts that aren’t net neutrality-friendly — and that’s not a market ISPs want to miss out on.

Verizon, AT&T, and Spectrum provide broadband service throughout California, which is the most populous state in the country with nearly 40 million people. According to BroadbandNow, Los Angeles is Spectrum’s largest market and AT&T’s fourth largest. There were over 12 million wireline and fixed wireless subscribers and over 35 million wireless subscribers in the state as of December 2016, said Christopher Chow, California Public Utilities Commission’s public information officer.

Image: California Public Utilities Commission

Marc Martin, a telecom lawyer for Perkins Coie, said that if it passes, the bill could help incentivize other states to draft similar legislation. “California is a massive market,” Martin said. “You start to approach a critical mass where broadband providers can’t ignore net neutrality as a policy matter. They’re not going to stay out of the California market or Washington or any other state that adopts these rules.”

California has a long history of single-handedly forcing national legislation across a range of issues, like air pollution regulation. Since the state is one of the nation’s largest car-buying markets, its more demanding pollution and fuel efficiency regulations have forced automakers to roll out compliant cars nationwide. It’s been so influential that the EPA, under the Trump administration, is working to remove that ability.

California could have the same degree of influence on the broadband market, Martin said. “If they have to comply with it in some states anyways, it’s easier to follow it everywhere,” he added. If they don’t, they’ll be enforcing two different administrative policies when it comes to net neutrality — one for the states with their own laws and one for those that don’t.

If it does pass, California’s legislation could also spark a series of lawsuits against states adopting similar measures. In December, the FCC put a clause in its rollback that forbids states from passing their own regulations. Washington state passed its own in March, and the commission has yet to take action.

“The FCC might be waiting for someone else to take an action, like a broadband provider who might want to challenge Washington state,” Martin said.

Assembly Speaker Anthony Rendon’s communications director, John Casey, said in an email to The Verge that the bill is not likely to be brought up until the middle of June — around the same time net neutrality is set to expire.