Issues & Insights

FCC Should Carefully Craft Digital Discrimination Rules

The Federal Communications Commission is moving forward with creating rules that would prevent digital discrimination from impeding access to broadband. The FCC should steer clear of an idea that has been proposed that would impose liability on providers for practices that are considered nondiscriminatory, but could adversely affect legally protected groups.

In the Infrastructure Investment and Jobs Act of 2021, Congress charged the FCC with establishing rules to prevent “digital discrimination of access based on income level, race, ethnicity, color, religion, or national origin.” The FCC is considering basing its definition of digital discrimination on disparate impact, disparate treatment, or both. Disparate treatment denotes intentional discrimination, while disparate impact indicates unintentional actions that ultimately lead to discrimination.

Providers should not intentionally discriminate against legally protected groups, but the latter designation could lead to a dangerous and slippery slope that unfairly places blame on providers. Consider the case of the most rural regions, which tend to include the few pockets of the United States that currently receive no fixed broadband services. In rural areas that include majority nonwhite populations, providers could be accused of digital discrimination even though the reasons they don’t service these areas is because an economic case cannot be made to spend the money on infrastructure there. That would also be the same reason those providers don’t service very rural areas with majority white populations.

In fact, the evidence indicates that nonwhite groups currently have better access to broadband. Former FCC chief economist Glenn Woroch examined Form 477 data showing wireline deployment at the census block level and found that 93.8% of nonwhite households received broadband service at the 100Mbps/20 Mbps level compared to 88.8% of white households. The explanation for this is pretty simple: cities – where it’s easier to make the economic case for broadband deployment – have higher nonwhite populations, while rural areas tend to have a higher percentage of white residents.

Woroch further found that income level didn’t affect access because both those populations above and below the federal poverty guidelines had access to broadband at about a 90% rate.

Randolph J. May and Seth L. Cooper of the Free State Foundation make the argument that Congress’ instruction was to bar intentional (not unintentional) discrimination. Rather than place blame on providers, they suggest that Congress and the FCC should develop targeted subsidies to ensure equal access. 

In a report published in September, the Phoenix Center examined fiber availability and speeds by race and income. Authors George Ford and T. Randolph Beard called the results “encouraging,” finding that no systematic evidence of digital discrimination was occurring. 

The pair make the point that digital discrimination would be illogical for a for-profit business.

“As profit maximizing firms, discrimination seems improbable as profits are foregone when equally profitable areas are treated differently based on something like racial animus. It seems likely that cost and demand differences will explain differential treatment, and such differences do not reflect discrimination,” Ford and Beard wrote.

This is a similar point made by the left-leaning Public Knowledge in previous comments to the FCC on the issue. That group noted that “service providers and industry association comments emphasize their efforts to avoid policies and practices of intentional discrimination. There is broad agreement that this is likely the case; no commenter has alleged or described any example of invidious or intentional discrimination directed at people or communities based on race, ethnicity, or religion.”

Codifying rules against digital discrimination is a good step by the FCC. But the commission should carefully craft the language of those rules so that providers trying to do the right thing by closing the digital divide don’t get unfairly blamed for those pockets of the U.S. that still lack access.

Johnny Kampis is director of telecom policy for the Taxpayers Protection Alliance.

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