Multifamily Leaders Up In Arms As FCC Mulls Banning Bulk Broadband Billing

A potential ban on bulk WiFi billing for apartments and their tenants has sparked fierce pushback among industry organizations, while tenant advocates and the Federal Communications Commission argue such a ban would allow tenants more choice.

The FCC is considering a proposal that would restrict residential landlords and condo boards from providing broadband service from a single provider under a blanket contract with a fixed price, known as a bulk billing agreement.

“Everyone deserves to have a choice of broadband provider,” FCC Chairwoman Jessica Rosenworcel said in a statement in early March. “That is why it is not right when your building or apartment complex chooses that service for you, saddling you with unwanted costs, and preventing you from signing up for the plan and provider you really want. This proposal shuts down these practices.”

The FCC didn't respond to a request for comment from Bisnow. The proposed ban is currently “on circulation” at the FCC, meaning that commissioners are reviewing it but there is no fixed timetable for official action.

If enacted, the chairwoman's proposal would apply to apartments, condos, public housing and other multitenant buildings. Broadband, cable and satellite service provided by specific communications providers would fall under the ban.

Bulk WiFi billing entered the scene for apartment renters several years ago but has grown in commonality, especially as landlords pursue ever-more enticing amenity packages to lure tenants. Under the agreements, tenants’ WiFi is predetermined by a contract between the landlord and an internet provider, with the cost usually rolled into the rent. 

Being stuck with a specific internet provider is a common complaint on a tenant hotline maintained by the Metropolitan Tenants Organization, a tenants' rights group based in Chicago, according to MTO Executive Director John Bartlett.

“We would be supportive of a ban because we do get calls from people who feel they're forced into it,” Bartlett said. “It could be a good deal, and tenants should be able to opt in if they want. But they should also be able to opt out if they don't.”

Those against the ban cite the bigger picture of cost and access to broadband.

The National Multifamily Housing Council is leading industry opposition to the ban, along with the National Apartment Association. The groups assert a ban  would harm residents more than it would help them by disincentivizing investment in broadband service, especially to lower-income residents.

“Bulk broadband typically delivers cheaper, faster, more reliable internet to residents of apartment communities than what's generally available in the broader market,” NMHC Vice President of Government Affairs, Technology and Strategic Initiatives Kevin Donnelly said. “The bulk model has been successful in reaching and breaking down barriers to populations that otherwise would struggle to get connected.”

Bulk billing is seen as a kind of amenity for many properties, according to Broadband Agreements CEO Morgan Fussell, whose company negotiates bulk agreements.

“Properties have pools, tennis courts, pickleball courts and so on,” Fussell said. “Now does every single member use all those amenities? No, they don't. But they pay for them.”

Fussell also notes that bulk pricing has been around for a long time, though only comparatively recently in terms of broadband. In previous decades, landlords and condo boards offered cable television services that way, without serious complaint.

Banning bulk billing could prevent deeper access to the internet by disincentivizing necessary broadband infrastructure investment in properties that don't have it, according to Community Associations Institute Chief Strategy Officer Dawn Bauman, whose organization is a trade group for homeowner and condominium associations.

When one company comes in and offers a service, often they put in very expensive infrastructure in the building that owners couldn't otherwise afford,” Bauman said. “It's an incentive to the company to know that they're going to be able to keep those customers.”

Although the FCC’s rationale for the proposed ban is to increase choice for consumers, the internet service provider landscape is notoriously limited. Most people throughout the country are limited to one option for internet access, two if they are lucky.

Almost all Californians, for example, receive broadband internet access from one of just five companies: Charter Spectrum, Comcast Xfinity, Frontier, Cox or AT&T. Many have no choice among those providers, which tend to carve up territory, limiting competition among themselves, The American Prospect reports.

But, since many companies package internet service with things like landline phones or cable television, there are choices for consumers to make, even in the confines of a small number of ISPs. Other needs vary, like how fast a particular renter needs their internet to be, for example. Bulk billing can remove a tenant’s ability to choose in that regard as well.

The possible FCC rules wouldn't be the first time that the commission has enacted regulations regarding broadband in multifamily settings. In 2022, the commission banned the practice of broadband providers compensating building owners in exchange for access to multitenant buildings.