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Key Economic Indicators 
Item  Rate 
CPI: 0.3% (Apr 2019) 
GDP Growth:   3.2% (1st QTR 2019)
Bank Prime Interest Rate:   5.5%
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Oct 2018


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Why Are States Passing Their Own Net Neutrality Laws?

Since the repeal of the 2015 net neutrality regulations many states have contemplated passing their own Net Neutrality laws.  However, so far, only California, Washington, Vermont and Portland have passed such laws.  What does it mean for you and your small business?


Due to the lack of a national law, states believe they have the green light to pass such laws, even though the FCC stipulated that states should not do so.


Individual states net neutrality laws will make it more complicated for service providers to provide services that comply with individual state laws.  It means that they could no long provide uniform services across the nation.  This could drive up the cost of providing Internet services.  This higher cost would eventually be passed on to consumers.


The net neutrality laws being passed by individual states seek to re-impose some of the guidelines enshrined in the 2015 rules before it’s repeal in 2018.  Some of these rules include:


-The blocking or slowing down of certain websites or classes of applications (like video).


-Prevents “fast lanes”.  Bans paid prioritization where some websites could pay more for faster access.


-Stops Internet providers from using some types of “zero-rating”.  This is when companies exempt certain traffic from counting against a customer’s data usage.  Companies that are Internet Service Providers and content providers could take advantage of this to the detriment to their competitors who are not Internet Service providers.


In repealing the 2015 law the FCC implemented new regulations called “light-tough” which took a less heavy-handed approach to regulating the Internet.  The 2015 rules require Internet Service Providers to be regulated as utilities where they could be heavily regulated and hence drive up the cost of doing business, which could be passed on to the consumers.  The 2018 change placed ISPs under the Federal Trade Commission (FTC) for regulation where consumers would have a better chance of having their complaints heard without driving up the cost of doing business for the ISPs.


The law makers voting to pass these individual state laws claim that by doing so they will lower the cost to consumers.  But, the unintended consequences of all of these individual state laws could mean higher cost to the average consumers, including your small business.


In 1996, a bipartisan Congress decided that the Internet should remain “unfettered by Federal or State regulation.”  Hence, the federal government filed suite against the state of California for violating the law.


Until a solution is reached, either through a court decision or national legislation, you can expect to see more states try to pass their own net neutrality laws, which will lead to higher costs to businesses and consumers.


No legislation is being proposed in Congress at this time to remedy the situation.

California SB 822
Oregon HB4155 
Washington Governor’s Website
Washington HB 2282
Vermont Executive Order 2-18
Vermont S289
Federal Communications Commission (FCC)
Department of Justice

By Wendy Stewart













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