US Senate floor proposal bans internet service data caps calling them “predatory”

Editor’s take: Internet service providers are notorious for squeezing their customers. Advertising higher speeds than they typically provide in practice, numerous hidden fees not disclosed before signing up, and data caps are enough to have consumers pulling their hair out in frustration. Congress wants to address at least one of those problems, but it could just end up raising overall prices for everyone.

The US Senate proposed a bill called the “Uncap America Act,” which looks to ban data caps from broadband providers that appear predatory. However, the Act would allow limits for “reasonable network management or managing network congestion.”

Democratic Senators Ben Ray Luján of New Mexico and New Jersey’s Cory Booker introduced the proposal last week. The legislators say internet service providers should not gouge families with unnecessarily high overage fees for high-speed broadband access.

“As internet usage continues to be a necessity for work, education, and health care, no family should have to worry about extra fees and costs because of unnecessary limits on their data,” said Luján in a joint press release.

Good story in @arstechnica @jbrodkin on the new Uncap America Act from @SenatorLujan @SenatorBooker. INCOMPAS is proud to join this effort with leading consumer advocates

— INCOMPAS (@INCOMPAS) July 22, 2022

“Internet access is a basic necessity and has been increasingly important throughout the coronavirus pandemic,” added Senator Booker. “Unfortunately, many internet providers have imposed predatory data caps, making it difficult for many vulnerable families to access high-speed internet.”

The bill does not explicitly define “predatory data caps” but leaves that to the Federal Communications Commission (FCC). The FCC will devise regulations and determine what exactly constitutes predatory practices. However, the color of the bill points toward the fees associated with going over a given data limit deemed purely for profit purposes.

Broadband service providers will undoubtedly have lobbyists working overtime to block the bill’s passage. However, it might not be necessary since proposals like this tend to struggle in Congress during election years. Although, with the current recession, lawmakers might be more open to passing anything that could ease the economic strain on their constituents.

Several watchdog groups have voiced their support for the proposed law, including Consumer Reports, Public Knowledge, and Incompas.

Senior Policy Counsel Jenna Leventoff, at Public Knowledge, says that providers often use data caps as a backdoor to raising prices for access and disproportionately prey on low-income families.

“CR strongly supports the Uncap America Act authored and introduced by @SenatorLujan [and Senator @CoryBooker]. Americans need fast, reliable and affordable internet connections that are free from the burden of data caps,” said CR’s @jonschwantes

— Consumer Reports Advocacy (@CRAdvocacy) July 21, 2022

“The pandemic has proven that data caps are rarely necessary as an economic matter, often operating as a roundabout way for providers to increase prices,” said Leventoff. “These data caps disproportionately impact low-income people who can’t afford to pay up in the first place.”

An Incompas spokesperson claims it supports the measure because overage fees threaten “an open, robust, and innovative internet ecosystem” and create an “artificial scarcity” to justify raising prices.

Consumer Reports agrees, calling most data caps “frivolous” fees that “chill internet” usage. However, it does support meaningful limits when it comes to network-essential reasons such as maintenance.

“This bill will ensure that ISPs are not allowed to include frivolous data caps at the expense of consumers,” said Consumer Reports Senior Policy Counsel Jonathan Schwantes. “We encourage Congress to vote yes on this bill so Americans will be able to install new security updates, conduct a job interview, or let their children complete their homework online without the fear of being penalized for exceeding data caps. Where caps are legitimate and justified, so be it. But we can’t allow ISPs to maximize profits at the expense of consumers.”

Unfortunately, we have seen too many times how broadband providers get around regulatory pressure like this proposed legislation. Without further protections, there is nothing stopping an ISP from lifting data caps, but inflating prices across the board — a lose-lose situation for everybody.

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