USTelecom's 2026 Broadband Pricing Report Sings a Familiar Refrain: Backtracking Prices and Surging Speeds

The latest broadband pricing report released by USTelecom | The Broadband Association (USTelecom) tells a familiar – and welcome – tale of falling prices and rising speeds.

Released on Tuesday and, as in previous years, prepared by Business Planning, Inc.'s Arthur Menko, "2026 Broadband Pricing Index: Faster Speeds, Lower Prices" (2026 BPI) analyzes data from 2025. It concludes that real (that is, adjusted for inflation) prices fell as speeds continued to climb. Specifically:

• PRICE: For the most-popular offerings (those delivering download speeds between 100 Megabits per second (Mbps) and 940 Mbps), the 2026 BPI reports that real prices dropped by 6 percent. The price of so-called "entry-level" plans – which provide download speeds between 100 and 249 Mbps and which USTelecom characterizes as "the most accessible tier for price-sensitive households" – reportedly decreased by an even greater margin: over 17 percent. According to the 2026 BPI, the price of gigabit (1,000 Mbps or greater download speeds) services fell nearly 5 percent.

• SPEED: The 2026 BPI concludes that subscribers to the most-popular offerings in 2025 saw speeds increase by nearly 22 percent – and since 2014, those speeds have increased by 145 percent.

Americans appear to recognize that the broadband value proposition hasn't merely improved but stands as a welcome outlier in comparison to other household expenses. According to a March 2026 survey of 1,500 likely voters conducted by Impact Research and cited in the 2026 BPI, only 2 percent of respondents identified the price of home Internet service as a top two cost concern, rendering it the least pressing of all surveyed categories, which included groceries, health insurance, housing, gasoline, and prescription drugs, among others.

It is important to note, of course, that none of this happens by accident. Thanks to the expenditure of tens of billions of dollars in private capital each year – according to an October 2025 USTelecom investment report, nearly $90 billion in 2024 and over $2.2 trillion total since 1996 – fierce competition among a diverse set of facilities-based providers increasingly delivers better service at lower cost.

In a companion blog post, USTelecom CEO Jonathan Spalter summarized the report in plain terms – "broadband internet service continues to deliver more value for less money" – and urged policymakers to ensure that those trends continue. Specifically, he identified copper retirement and permitting reform as two areas ripe for further deregulatory action.

As it happens, in comments filed yesterday regarding the Commission's next report on the state of competition in the communications marketplace, FSF President Randolph May and I made the same two points. We also identified the pole attachment "accelerated docket" and the spectrum pipeline as areas where the FCC can take steps to accelerate broadband investment and deployment.

Free State Foundation scholars have summarized every BPI report released by USTelecom. Posts to the FSF Blog addressing previous versions are available here: 2024 | 2023 | 2022 | 2021 | 2020.

Maryland Has a Long Way to Go on Taxes

With Maryland's new budget going into effect in July for FY 2027, Governor Wes Moore has touted the plan as fiscally disciplined, citing no new taxes or fees. But one year without new increases doesn't reverse Maryland's problematic budgetary trajectory.

Maryland residents and businesses are still living with the tax increases enacted in the current FY 2026 budget, which included a 3% sales tax on IT services; an increase in the vehicle excise tax rate from 6% to 6.5%; an increase in the vehicle emissions inspection fee from $14 to $30; a 3.5% rental vehicle tax; and a new $5-per-tire fee, among others.

Maryland has traditionally been among the least tax-competitive states in the country, and it’s only gotten worse under the Moore administration. According to a Tax Foundation analysis of its State Tax Competitiveness Index, Maryland ranked 42nd on the index in FY 2020 and has since fallen to 46th in FY 2026, where 1st is most competitive and 50th is least.

Neighboring states have also seen their tax-competitiveness rankings slip over that period, but they all remain substantially more competitive than Maryland, according to the Tax Foundation report. In FY 2026, Delaware ranks 24th, Pennsylvania 36th, and Virginia 30th.

The income tax is a big part of why. Maryland’s low tax competitiveness is driven in large part by high income taxes, as the Tax Foundation's full report details, a topic I covered last month. As part of the FY 2026 budget, Maryland created a new top marginal rate for personal income tax at 6.5%, compared to 3.07% in Pennsylvania, 5.75% in Virginia, and 4.82% in West Virginia. Maryland’s corporate income tax rate is also high at 8.25%, compared to 7.99% in Pennsylvania, 6% in Virginia, and 6.5% in West Virginia.

This matters especially because Maryland is an expensive, high-cost-of-living state competing for businesses and workers who have options regarding where they choose to live. Maryland is making itself a harder and harder sell.

Governor Wes Moore needs to get serious about improving Maryland's budgetary situation. As part of that effort, the "Free State" definitely needs to treat improving its tax competitiveness ranking as an economic priority.

PRESS RELEASE: FSF Comments Show the FCC That the Communications Marketplace Is Competitive

Today Free State Foundation President Randolph May and Senior Fellow Andrew Long submitted comments in the FCC’s proceeding to examine the state of competition in the communications marketplace. Below is the Introduction and Summary of the comments.

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"In 2026, the hallmarks of the communications marketplace are competition and convergence. Wherever legacy regulations do not interfere, countless providers efficiently deliver communications – in whatever form (text, voice, video) – over a range of ubiquitously available IP-based distribution platforms. With respect to both content and connectivity, competition abounds.

 

As such, to achieve its goals, this next competition report need only identify additional opportunities to tear down rusty silos, repeal expired rules, and employ the various tools in the Commission's toolbox to achieve further deregulation – the DELETE, DELETE, DELETE proceeding; rulemakings; forbearance; waivers; sunset provisions; and so on. This will encourage further private investment (which has surpassed $2.2 trillion since 1996), accelerate deployment timelines, and, more broadly, eliminate unnecessary red tape.

Specifically, the Commission should acknowledge the true scope of the consumer-driven broadband marketplace (not some artificially contrived and constrained "broadband" marketplace) and, in response, take action to advance the transition to all-IP networks; eliminate unreasonable permitting hurdles at every level of government; continue to take swift action to resolve pole-attachment disputes; and take measures necessary to keep the spectrum pipeline flowing.

To unlock the full potential of unfettered competition to benefit consumers in the video programming marketplace, the Commission should: (1) reject calls to extend antiquated regulations applicable to facilities-based distributors to over-the-top providers – and instead eliminate those regulations altogether; (2) direct a fresh set of eyes to the regulated relationship between local broadcast television stations and facilities-based distributors, including asking whether in 2026 (a) there remains a factual predicate for the retransmission consent regime, and (b) there might be a more direct and efficient way to promote localism than taking steps to prop up legacy revenue streams (e.g., sports-driven advertising sales); and (3) going beyond the proposal to eliminate set-top box reporting requirements and sunsetting all of its rules implementing the navigation device provisions of the 1996 Telecommunications Act."

Do Pole Attachment Issues Threaten BEAD Projects?

On May 12 researchers Alex Karras and Michael Santorelli of the Advanced Communications Law & Policy Institute at New York Law School published a report and analysis of the cost of getting access to utility-owned poles as part of the deployment costs under the historic Broadband Equity, Access, and Deployment (BEAD) Program. The bottom line is that projects funded by BEAD are expected to lay 188,287 miles of aerial fiber on 3.9 million poles within 2,053 separate electric utility service territories. Using rough estimates, the estimated pole costs that BEAD contractors will have to pay in order to attach to poles range from $534 million to $4.63 billion nationwide.

Every BEAD deployment contractor had to estimate actual pole attachment costs as part of the application process. The study’s authors were not trying to duplicate these estimates. However, the range of estimates could be a sign that actual costs will vary widely. In a situation where contractors are facing tight deadlines and where actual costs are uncertain, pole attachment issues could become the focus of a lot of deployment problems. Coming on top of a renewed legal battle between Comcast and Appalachian Power Company, the large range of attachment prices shows that there is tremendous room for disagreement between broadband contractors and pole owners.

 

According to the report, pole ownership and regulation follow a “scattershot” approach. Electric cooperatives play a disproportionate role. Although they only serve 13% of electric customers, about 40% of BEAD aerial fiber will be deployed across their territories. The FCC has jurisdiction over poles owned by investor-owned electric utilities (IOUs) in 27 states. In the other 23 states, IOU poles are regulated by state public utility commissions. Regulation of poles owned by cooperatives and municipal electric utilities differs among states. The authors speculate that: “[i]n states where cooperatives and municipal electric utilities are unregulated, there are few guardrails in place to provide predictability and consistency in how pole-related costs are set, increasing the chances that BEAD subgrantees could encounter higher-than-expected pole fees from these entities.”

Electric utility pole issues have a significant effect on broadband deployment. The National Telecommunications and Information Administration (NTIA) has tried to address regulatory problems by extending the reach of the FCC’s rules. The FCC recently showed its willingness to act quickly in resolving pole disputes by expediting its decision in a dispute between Comcast and Appalachian Power Company. Comcast alleged that Appalachian Power was charging it for pole damage that was caused by third parties. The Commission ruled that Appalachian Power could only charge Comcast for the incremental cost of its project.

However, Comcast recently approached the Commission complaining that Appalachian Power was refusing to abide by its ruling. Thus, it remains to be seen whether tougher action by the FCC or NTIA will translate into a quicker, less contentious process that lowers cost or whether it leads to a rise in litigation that slows everything down.

Using a variety of independent studies, the researchers chose low, medium, and high estimates of pole costs depending on whether a pole just needs equipment added or whether it needs replacement. Their estimates are limited to electric utility-owned poles, which constitute about 70% of the total. Including all poles would raise the price significantly. The estimates for the cost per touched pole were $75 (low), $175 (base), and $450 (high). The estimates for the percentage of poles that will have to be replaced were 3% (low), 4% (base), and 8% (high). Finally, the estimates for the cost of replacing a pole were $2,000 (low), $3,500 (base), and $9,000 (high). Using the base assumptions produced an estimate of $1.25 billion or roughly 6 percent of BEAD deployment funds. The boundary estimates were $534 million (low) and $463 billion (high). This leaves a lot of room for disagreement between BEAD contractors and pole owners.

What can be done? The NTIA requires cooperatives and municipal utilities that participate in the BEAD program as subgrantees to comply with FCC pole attachment rules as a condition of accepting BEAD funding. The rules cap rates and charges that pole owners can impose on contractors. They also create timelines for processing applications and require regular progress reports. The authors also advocate letting states use some of the remaining $21 billion in nondeployment BEAD money to offset unexpected pole attachment costs. They point to successful models in Texas and North Carolina as good examples. State regulators could also rationalize pole issues as well as the accompanying permitting, rights of way, and easement issues that accompany them.

With proper policies in place, broadband providers around the country will soon be engaged in a major deployment effort to significantly expand coverage to unserved and underserved areas. In a project of this scope, problems are inevitable. But many of these problems, including pole attachments, can be managed better if regulators and broadband providers perform proper due diligence, build strong relationships, and create transparent, predicable processes.

Revised BEAD Program Connects its First Location

On November 15, 2021, the Infrastructure Investment and Jobs Act – that is, the legislation that created the $42.45 billion Broadband Equity, Access, and Deployment (BEAD Program – was signed into law. On May 14, 2026, 1,641 days later, BEAD Program funding at long last enabled the connection of its very location.

Of course, millions more locations are expected to come online in the coming weeks, months, and years.

In remarks offered on location in Ogallala, Nebraska, NTIA Administrator Arielle Roth highlighted the expediting impact of the "Benefit of the Bargain" revisions adopted last year. She also discussed changes designed to reinstate Congress' technologically neutral intent. In that regard, she noted that "[i]t's not an accident that this connection here in Ogallala is from an unlicensed fixed wireless provider."

Finally, a reminder: Ms. Roth will be a keynote speaker at the Free State Foundation's Twentieth Anniversary Celebration on Thursday, June 4, from 11:45am to 3pm, at the National Press Club. If you haven't already, register here to catch her fireside chat with FSF President Randolph May as well as an impressive lineup of other speakers.

Finding a Consensus on Accomplishing Permitting Reform

With the House of Representatives’ failure to schedule a vote on the American Broadband Deployment Act of 2025, we may have reached an impasse, at least for the moment, on achieving additional permitting reform at the state and local levels. Congress has taken several steps forward on reform at the federal level. But these mostly involved changes to the National Environmental Policy Act or the National Historic Preservation Act, the statutes that govern the majority of federal permitting decisions. However, one past attempt at negotiation may offer some lessons.

The success at the federal level led many to conclude that circumstances might be right for a more comprehensive reform to remove obstacles at the state and local levels. On March 24, Representative Buddy Carter (R-GA) introduced H.R. 2289, the American Broadband Deployment Act, which combined provisions from roughly 20 previous bills, including shot clocks and limits on fees, to accomplish broad reform. The bill passed the House Committee on Energy and Commerce and was scheduled to go before the House Rules Committee on April 20^th. However, a vote was indefinitely postponed once it became obvious that the bill lacked the votes to pass. This change in outlook was widely attributed to opposition from a number of associations representing state and local government, including the National Association of Counties and the U.S. Conference of Mayors.

Although Congressman Carter expressed confidence that the bill would pass later this Congress, the debate currently seems to be at an impasse. While the FCC is pursuing permitting reform under its own authority, the timing of any decision is not known and any significant change will be immediately challenged in court, delaying its effect. Meanwhile the significant increase in buildout activity due to the Broadband Equity, Access, and Deployment Program (BEAD) is approaching.

This is a shame because sensible permitting reforms would benefit both broadband providers and local governments. To start, unnecessary time and costs delay the build-out and use of broadband coverage to local households. Coverage in turn is firmly linked to greater economic activity and higher living standards. In the short-run permitting also increases local demand for skilled labor. So far much of the debate has been confined to anecdotes regarding specific experiences and limitations on the FCC’s powers, especially in light of recent Supreme Court decisions. While a list of unreasonable fees, unrelated construction requirements, poor construction planning, and damage to state and local property catches one’s attention, it is probably not the best grounds for determining public policy.

Almost two years ago the Benton Institute for Broadband & Society teamed up with the Georgetown Law Institute for Technology Law & Policy and groups of both Internet supporters and state and local governments to explore the possibility of improving the permitting process in ways that benefit all stakeholders. The effort involved a survey of stakeholders, a one-day conference, and a written report.

The report contained several sensible suggestions for reform. It listed three findings, each of which produced more specific suggestions. First, the parties should foster a partnership between the permit seeker and the permitting authority. They should try to create trust and accountability by meeting early and often and understanding the role of both local government and the proposed development. According to the report, one key issue is determining when any shot clock would start.

Second, the parties should maximize the resources available to the permitting authority. There was a consensus that many permitting agencies lack the resources needed to handle the normal permitting volume, let alone the significant increase expected from BEAD disbursements. Given BEAD’s history and the current delay in announcing how the government will spend approximately $21 billion in non-deployment funds, one should not be surprised if a large number of projects experience significant delays from a variety of causes, placing greater strains on agencies. Given that much of the under capacity may be due to the increase in BEAD-funded construction projects, perhaps using some of the excess to increase local capacity, at least through the surge, makes sense. Providers should also help agencies build public support by articulating the benefits of broadband delivery.

Third, the process should be transparent and consistent. Efforts to modernize the process by allowing builders to download forms, submit applications online, and look up the current status of projects can lower total costs and reduce unnecessary duplication. Modern online dashboards are already being used successfully in some jurisdictions.

In general, and certainly in the abstract, the Benton Institute report recommendations are sensible and merit action. However, they do not address some of the worst abuses regarding permitting at the local government level. These abuses increase the costs of broadband deployment projects and delay the provision of new or improved service to consumers.

Taking the position that state and local governments should face no deadlines, should be able to charge whatever fees they suggest are reasonable, and should be allowed to require substantial unrelated improvements seems like something we should avoid.

AI Plus 6G: A Convergence of Mutual Necessity

In conjunction with its annual summit on May 6, CTIA issued a new report devoted to the ongoing merger of wireless technology and AI: Wireless & AI: Driving the Future of Innovation. The report points to the growing co-dependency between the data networks (wired and wireless) and artificial intelligence (AI), a technological advancement that promises to create great value. In doing so, the report discusses several main points that are likely to drive the future of both AI and broadband.

The first principle, which I discussed in an FSF Perspectives earlier this year, is that AI and networks are increasingly interdependent. As the CITA report mentions: “AI requires wireless networks to move data, help coordinate real-time decisions and operate effectively with the physical world. In turn, wireless networks rely on AI to manage the surging complexity and record traffic driven by AI’s own insatiable data demands.

AI without data networks is useless. AI needs the models to download vast amounts of data of all types (code, text, sound, and visual), transport them to any location, process the information, transmit the analysis, and increasingly, act on the results itself without human intervention, a phenomenon the report refers to as "Physical AI." AI will operate across three layers; devices, edge, and the cloud, depending on the speed, complexity, and cost of the task.

Second, the dependence is two-way. While AI is heavily dependent on communications networks to maximize its use of data, the rapid increase in AI’s use of networks demands that the networks use AI to maximize their capacity in the form of transmission capacity, latency, and compute power. Just as the global power of AI depends on networks’ capacity, that capacity must use AI to expand in order to meet these increased needs. 6G networks will respond dynamically to the conditions and demands facing them. Already some are predicting that by the end of the decade one-third of AI traffic needs could go unmet. Accenture estimates that this could reduce potential GDP by $1.4 trillion.

The third point is that the physical merger is already occurring. 6G networks will increasingly connect with a wide variety of machines and sensors. Unlike existing networks, AI will require massive amounts of data to be uploaded into communications networks for analysis. AI traffic is expected to power 75 percent of smartphones within two years. Already, AI traffic is growing three times faster than overall traffic and is expected to account for 30 percent of networks’ traffic by 2034. Finally, 6G networks are expected to increase energy efficiency by 30 percent.

These advancements impact economic growth and national security. AI and wireless are the two top sources of infrastructure investment in the current economy, offsetting some of the uncertainty caused by higher consumer prices and international conflict. The significant dual use capability of AI and network advancements creates significant security implications and places a premium on intelligent and timely regulation. The world’s complexity increasingly cannot be resolved by humans manually reacting to data flows that move faster than human reaction time.

The report focuses on two major areas for policy reform. The first is the allocation of large contiguous blocks of licensed spectrum. The value of spectrum has grown rapidly due both to new uses and the increased capacity of existing uses. As a result, the allocation of spectrum is attracting increased demands from government, industry, and consumer use. The sooner Congress and regulators can develop methods for allocating spectrum to its most valuable uses, the better. The report points to next year’s World Radiocommunication Conference as an important milestone for developing a Western response to international policy.

Finally, permitting reform will also play a large role in determining the pace of innovation. Companies frequently need government approval at the federal, state, or local level before they can start building out Internet infrastructure, whether in the form of home broadband, data centers, or transmission lines. At the state and local levels it is not uncommon for agency officials to demand high fees or costly extraneous requirements as a condition to start construction. While some progress has been made at the federal level, state and local entities still impose significant delays. Both the FCC and Congress need to continue to remove impediments and implement meaningful permitting reform.

The ongoing merger of the communications networks (including eventually 6G) and AI will have vast implications for society. Machines will gather more information, transmit it widely, analyze any correlations within it, and act on the results. This will dramatically expand the information available to humans. The challenge is to use it wisely and for the benefit of all. AI without reliable, secure, high-capacity communications networks is useless, but the networks without AI will collapse.

Maryland Doesn't Need to Stop Dynamic Pricing

Developments in artificial intelligence continue to raise alarm among the public and lawmakers. Among the many concerns cited about artificial intelligence and automation is dynamic pricing. To this end, Maryland Governor Wes Moore signed legislation last week banning grocery stores and third-party delivery services from using individual shopper data to increase prices "dynamically."

Under dynamic pricing, sellers may use data about shopping behavior to automate and continuously adjust their prices. Under individualized dynamic pricing – sometimes called surveillance pricing in pejorative terms – businesses set different prices for different consumers by charging more to shoppers who appear willing to pay a premium or offering lower prices to customers who might not otherwise buy. Other types of dynamic pricing may include shifting prices at different times of day based on changes in demand or competitive conditions.

The underlying logic of dynamic pricing is straightforward: businesses have always tried to match price to demand, and data-driven tools make doing so easier.

Maryland’s bill drew public support, reflecting broader concern with companies exploring individualized pricing, especially on food and housing as basic needs. Critics frame these practices as predatory: corporations using shadowy algorithms to target and extract as much money as possible from individual shoppers.

However, the alarm reflects a misconception regarding what data collection and algorithmic pricing can actually accomplish. Even the most sophisticated artificial intelligence uses incomplete information and thus imperfect predictions – the same reason why centrally planned economies with government-dictated prices are so inefficient. Consumer preferences change with income, season, family circumstances, competing options, and other infinite variables that are impossible to capture in a dataset. The premise that an algorithm can reliably identify each shopper's maximum willingness to pay overstates the role that data and algorithms play in society.

Dynamic pricing is also already a routine feature of commerce. Airlines adjust fares continuously based on demand, booking patterns, and seat availability. That's why the person sitting next to you on a plane likely paid a different price than you paid for her ticket. Bars and restaurants offer happy hour pricing. Retailers run flash sales, time-limited promotions, and personalized discounts. Even Maryland’s own law acknowledges this reality with its numerous exemptions and clarifications for longstanding practices – promotional pricing, loyalty program discounts, and other temporary price reductions.

Moreover, the alarm over dynamic prices overlooks the consumer benefits. A grocer or other business that makes more sales has more room to keep overall prices low, and dynamic individualized prices can be what closes a sale that otherwise would not have happened. This means that people can buy things that otherwise wouldn’t have fit in their budgets.

Maryland’s law purports to address a public concern by conflating a common business practice with a supposedly harmful predatory practice and without acknowledging the consumer benefits. Maryland should indeed tackle deceptive trade practices in grocery stores and elsewhere, but states should not ban technology before actual harms to consumers materialize. Regulating against possible harms has its consequences – shoppers forgo benefits that they never even see.

PRESS RELEASE: FCC's 'Digital Discrimination' Power Grab Held Unlawful

 

Regarding the Eighth Circuit Court of Appeals decision issued today holding unlawful the FCC’s rules promulgated in its “Digital Discrimination” proceeding, Free State Foundation President Randolph May issued the following statement:

“The FCC rule adopting a 'disparate impact’ theory purporting to hold broadband providers liable, along with many other entities only tangentially related to the provision of broadband services, for discrimination constituted one of the agency’s more blatant power grabs in an unfortunately long history of bureaucratic aggrandizement. The court of appeals had little difficulty in holding that the Commission exceeded its authority with regard to both the adoption of the disparate impact theory and the coverage of the entities potentially liable under its rules. Now the agency can put its focus on acts of intentional discrimination where it properly belongs.

Aside from getting rid of unlawful rules that sought to aggrandize its power, the court’s decision is important in striking down a loosey-goosey enforcement regime that could have imposed substantial monetary forfeitures on entities not subject to the Commission’s jurisdiction and for actions that they could not have known fell within the ambit of the agency’s rules. In other words, a lawless regime."     

More of the Same: Wireless Prices Continue to Fall

On April 29 CTIA issued the latest results from its regular survey of the price of wireless broadband coverage. The bottom line is that wireless prices continue to fall significantly even as most elements of the Consumer Price Index are increasing. Even with lower prices, wireless plans are delivering faster speeds, more data, and better service. CTIA attributes this history to a combination of spectrum auctions, market competition, and continual innovation.

CTIA’s Wireless Affordability Tracker is the result of surveys of unlimited and more affordable prepaid plans as well as government data. It shows that the average real price of post-paid unlimited plans fell 10% last year and nearly 35% over the last 5 years. More affordable prepaid plans fell by 2.6% last year and 50% over the last two years.

According to the Consumer Price Index the real price of wireless service fell by 6.6% last year and by 41% over the last decade. The price of smart phones fell by 12.2% last year and 63.4% over the last ten years. This is in contrast to the overall CPI, which increased by 2.7% last year and 37% over a decade. Between 2020 and 2024 the share of spending devoted to wireless subscriptions fell by 15.2% so that it now makes up only 1.73% of the average consumer’s total spending.

Unfortunately, taxes have risen. On average, taxes make up 27.6% of the monthly wireless bill. But for increasing taxes on wireless services, the price declines would be even greater. Reducing wireless taxes would make wireless even more affordable.

Despite lower prices, consumers are getting faster speeds and more capacity. The average speed got 51% faster while Americans used 32% more data. This pushed the price per gigabyte down by 21% in the last year and 40% over the last two years. The price per gigabyte has fallen from $20 in 2015 to under $2 in 2024. Prices of home Internet service dropped by 3% last year.

Today, there are over two hundred different service providers offering thousands of different plans. Lower prices have been rewarded. In 2025 wireless providers attracted 3.4 million new 5G subscribers. These trends are likely to continue. Regulators should ask themselves whether sensible regulatory reform can spur the same combination of competition, innovation, and declining real prices in other markets.

 

 

Let the Market Govern Call Centers

On March 27, the FCC issued a notice of proposed rulemaking for call centers located outside the U.S. On April 21 the National Retail Federation wrote to express its opposition to the proposal. It is not hard to see why. On the surface the proposed rule runs contrary to the Commission’s ongoing efforts to eliminate unnecessary regulation in its "Delete, Delete, Delete" docket. In substance, the Federation calls it “a stunning lack of understanding of how customer service actually works.”

The proposal would interfere with a sophisticated global trade in call center services. This in turn would likely add costs and delays to consumer calls. More important, it would have the Commission go beyond its primary duty of regulating the communications networks that handle international calls of whatever kind and involve it in regulating both the content and organization of specific business calls. Something it is not equipped to do.

The FCC’s proposed rule seeks to accomplish a number of things. It would require call center employees to speak fluent English and limit the amount of consumer service calls that could be made from offshore. Call centers would have to notify callers that the call is being handled offshore and give them the option of transferring it to a call center in the U.S. Finally, the rule would require companies to store sensitive customer only at centers in the U.S.

Call centers do not rank high on consumer satisfaction surveys. However, they perform an important business function. Retailers have a strong incentive to keep consumers satisfied because it is often cheaper to keep an existing customer than to attract a new one. Growing U.S. wages have led companies to move some call centers overseas. Retailers did this not out of a sense of animus toward the U.S., but out of a desire to reduce costs, a benefit that has largely been transferred to customers. Any requirement to move calls back to the U.S. would certainly raise prices and probably waiting times.

Similar proposals have been introduced in Congress. These should also be opposed. As a basic point, there is little evidence of any market failure. Operating call centers involves a balance between cost, waiting times, and call quality. The right balance should be determined by business principles, not politics.

The Commission’s notice requests a great deal of data regarding how its rule would work. Commissioner Anna Gomez refers to the rules as “extensive,” hinting at a large information burden on companies. At present, however, the Commission’s analysis relies heavily on anecdote. The FCC will also have to struggle with other issues, including how to handle non-English speaking consumers, the application to non-voice communications such as bots, requirements for providers of Internet-only services, and automation. The proposal would certainly speed the transition from workers to AI-driven programs.

The public justification for regulating robocalls and scams is clear cut. The need to regulate legitimate call centers is much less so. It would involve the FCC partly determining both the content of consumer calls and the structure of the call industry. Both lie beyond its primary duty of ensuring that communications networks promote the creation of value. A safer alternative would be to promote the collection of best practices for handling calls, securing data, and training workers.

"Soon" (But Not Too Soon), House Republicans Introduce Privacy Bills

In a Tuesday post to the Free State Foundation blog, I repeated the quote – which I first referenced in a January Perspectives from FSF Scholars – that the House Energy and Commerce Committee Privacy Working Group could introduce comprehensive data privacy legislation "soon." In this instance, "soon" translated to "Wednesday." That's when the House Committees on Energy and Commerce and Financial Services jointly introduced a pair of companion bills: the Securing and Establishing Consumer Uniform Rights and Enforcement over Data Act (SECURE Data Act) and the Guidelines for Use, Access, and Responsible Disclosure of Financial Data Act (GUARD Financial Data Act).

The SECURE Data Act is the handiwork of the aforementioned working group, led by Representative John Joyce, M.D. (R-PA). The working group is composed of Republican members of the House Energy and Commerce Committee, which is chaired by Representative Brett Guthrie (R-KY). The GUARD Financial Data Act, meanwhile, is the product of the Financial Services Committee, led by Chairman French Hill (R-AR).

The two bills are designed to work in tandem: the SECURE Data Act covers consumer data handled by nonfinancial entities but exempts financial institutions and data subject to the Gramm-Leach-Bliley Act (GLBA), while the GUARD Financial Data Act modernizes the GLBA for the financial sector but exempts nonfinancial firms. As a joint one-pager released by the two committees explained, together the bills "form a common-sense Federal approach that will bring American privacy protections into the twenty-first century."

At a high level, the SECURE Data Act builds on – and, crucially, would preempt – the state-level "patchwork" that I have long lamented. It also wisely rejects a private right of action, leaving enforcement to the FTC and state attorneys general.

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The SECURE Data Act establishes a set of now-familiar consumer rights, including the right to access, correct, delete, and transfer personal data. It also creates opt-out rights for targeted advertising, data sales, and certain automated profiling decisions. Processing of "sensitive data" would require opt-in consent, and parental consent would be required for the processing of data of teens (that is, those between the ages of 13 and 16). The processing of data of children under the age of 13 would remain subject to the provisions of the Children's Online Privacy Protection Act of 1998.

On the business side, the bill imposes data-minimization obligations that would limit the collection of data to what is "adequate, relevant, and reasonably necessary." It also includes data security requirements, privacy notice mandates, and data-protection-assessment requirements. Data brokers would be required to register with the FTC, which would maintain a searchable public registry. And businesses would have to disclose whether personal data is transferred to, processed in, or sold to foreign adversaries.

The SECURE Data Act would apply to businesses that process the personal data of at least 200,000 consumers annually. A separate threshold would cover data sellers that process the data of at least 100,000 consumers and derive over 25 percent of their revenue from the sale of personal data. Businesses with less than $25 million in adjusted gross annual revenue would be exempt.

As noted above, the bill does not create a private right of action. Instead, the FTC and state attorneys general would share enforcement authority. As I previously argued, exclusive enforcement by the FTC is far more likely to serve consumer interests than a private right of action, which would create problematic financial incentives for the plaintiffs' bar.

Perhaps most significant is the SECURE Data Act's broad preemption language, which provides that no state may "prescribe, maintain, or enforce any law, rule, regulation, requirement, standard, or other provision having the force and effect of law, if such law, rule, regulation, requirement, standard, or other provision relates to the provisions of this Act." This would appear to preempt the entire "patchwork" of state-specific privacy laws, now numbering 21, replacing them with a single, workable, nationwide standard.

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Of course, the standard caveats apply. As a Republican-only bill, the SECURE Data Act will need to attract bipartisan support if it is to become law. And the usual sticking points – in particular, the bill's rejection of a private right of action and its strong preemption language – could impede its progress, something we certainly have seen happen before to similar pieces of legislation.

Nevertheless, the SECURE Data Act seems to strike an appropriate balance between protecting privacy and fostering innovation, a point made by NCTA – The Internet & Television Association in its supportive statement: the SECURE Data Act's "unified approach will strengthen consumer trust, give individuals meaningful control over their personal information, and provide businesses the certainty needed to innovate, protect data, and drive growth while eliminating the confusing patchwork of state laws that burdens consumers and businesses."

Later Rather Than Sooner: Oklahoma Enacts State Privacy Law No. 21

After a steady stream of state-level privacy statutes, capped by passage of the Rhode Island Data Transparency and Privacy Protection Act in June 2024, for nearly two years the pipeline ran dry. That drought ended on March 20, when Sooner State Governor Kevin Stitt signed into law the Oklahoma Consumer Data Privacy Act (OCDPA). With that, the list of states to have passed a comprehensive data privacy statute now stands (by my count) at 21.

At the federal level, meanwhile, the pickings remain slim. In late March, Representative Zoe Lofgren (D-CA) for the fourth time introduced the Online Protection Act, the shortcomings of which I rehashed in a contemporaneous post to the Free State Foundation blog. Beyond that, hopeful eyes can look only to the House Commerce Committee Privacy Working Group, which was created in February 2025 and sought public input a month later. As I noted in a January Perspectives from FSF Scholars, reporting at that time suggested that the working group could release a draft bill … "soon."

The good news about the OCDPA, which closely tracks the Virginia Consumer Data Protection Act, is that it does not impose more burdensome obligations than existing state laws – and therefore is regarded as a relatively "business-friendly" addition to the state-level "patchwork."

The bad news, of course, is that it further expands that "patchwork," thereby compounding compliance headaches for companies – especially smaller companies and start-ups – and making it even more challenging for consumers to comprehend their rights.

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More targeted than other state laws, the OCDPA applies only to businesses operating in Oklahoma or targeting Oklahoma residents that control or process the personal data of either (1) 100,000 or more Oklahoma consumers, or (2) at least 25,000 Oklahoma consumers while deriving over 50 percent of their gross revenue from the "sale" of personal data. (By comparison, that threshold is lower – 25 percent – in most state laws.) In addition, the OCDPA defines "sale" relatively narrowly – that is, only where personal data is exchanged for monetary consideration.

The law establishes a now-familiar set of consumer rights: to access and confirm the processing of personal data, to correct inaccuracies, to delete, and to obtain a portable copy. In addition, consumers can opt out of the processing of personal data for targeted advertising, the sale of their personal data, and profiling.

"Sensitive data" – defined to include racial or ethnic origin, religious beliefs, health diagnoses, sexual orientation, citizenship status, genetic or biometric data used for identification, and precise geolocation data – may not be processed without the consumer's opt-in consent.

Covered businesses must abide by data-minimization principles, limiting collection to what is adequate, relevant, and reasonably necessary. They also must conduct data protection assessments before engaging in activities such as targeted advertising, the sale of personal data, and the processing of "sensitive data."

Two additional features of the OCDPA are worth highlighting. First, enforcement authority rests exclusively with the Oklahoma Attorney General; there is no private right of action. Second, the law includes a permanent, mandatory 30-day "right to cure" period for alleged violations – a feature that stands in contrast to the trend in other states toward sunsetting or eliminating cure periods altogether. Violations may result in penalties of up to $7,500 per incident.

The OCDPA will go into effect on January 1, 2027.

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As I've stated countless times, the absence of a comprehensive federal data privacy law that would preempt this now-larger "patchwork" remains a glaring gap. With each new state law – and each set of idiosyncratic definitions of rights, responsibilities, thresholds, exemptions, enforcement mechanisms, and so on – the compliance burden on businesses grows heavier and the regulatory landscape confronting consumers grows murkier.

Broadband Trade Associations Call on Congress to Pass H.R. 2289: The American Broadband Deployment Act

On April 13 a broad coalition of 13 associations representing different parts of America’s communications infrastructure wrote a joint letter to the leadership of the U.S. House of Representatives urging them to support passage of H.R 2289, the American Broadband Deployment Act (ABDA). The House Committee on Energy and Commerce passed the bill 26-24. The Rules Committee is scheduled to consider it on Monday, April 20.

The letter pointed out that, while Congress has devoted over $42 billion to the Broadband Equity Access and Deployment and other programs, builders continue to face persistent permitting barriers that delay deployment and realizing the full benefits of the funds. The letter makes several common arguments in favor of implementing permitting reform. First, the cost of delay due to inefficient permitting processes limits the reach of broadband networks and raises costs to consumers. Second, every dollar that is devoted to the permitting process is a dollar that cannot be invested in more efficient networking equipment. Third, broadband deployment supports America’s strategic position in the global contest to advance artificial intelligence because AI cannot function without connectivity.

 

H.R 2289 seeks to advance broadband deployment by establishing seamless, nationwide rules for obtaining federal, state, and local permits needed to complete broadband deployment. The ABDA codifies the FCC’s deployment streamlining orders and interpretations developed over the past two decades and builds on two current FCC efforts to speed permitting for wireless and wired deployments, respectively. The bill attempts to set out clear rules for state and local agencies, including streamlined review for deployments on existing infrastructure, binding shot clocks, and limits on the amount of fees and other conditions that can be imposed by agencies.

At the federal level, the bill provides that certain requests to modify an existing wireless tower or base station by collecting, removing, or replacing transmission equipment will not be considered a “major federal action” under the National Environmental Policy Act (NEPA) or an undertaking” under the National Historic Preservation Act (NHPA). This excuses companies from having to undergo long and costly environmental reviews.

The letter notes that the House has already passed two pieces of permitting legislation on a voice vote. H.R. 1665 passed the House on March 16, 2026. It directs the Secretaries of the Departments of the Interior and Agriculture to establish an online portal for the acceptance, processing, and disposal of forms seeking permission to use federal land for communications purposes. Each portal will be published on the website of the National Telecommunications and Information Administration for public use.

H.R. 5419 passed the House on March 3, 2026. It directs the Secretaries of the Department of the Interior and Agriculture to each conduct a study of programmatic or administrative barriers to the timely review of requests for broadband use authorizations, whether revisions to rules or regulations could improve efficiency with respect to reviewing requests for broadband land use authorizations, and whether there are processes for prioritizing the review of requests for broadband land use authorizations. Within a year the Secretaries must give a joint report to Congress describing the results of their respective studies, including any reforms described therein, together with a plan for providing the staffing necessary to ensure timely review of broadband land use authorizations.

It is notable that the focus on federal permitting efforts seems largely confined to reducing the requirements of the two major pieces of environmental legislation. This is consistent with two recent reports on federal permitting requirements. A 2024 report by the Government Accountability Office (GAO) found that the Bureau of Land Management and the Forest Service process most applications from telecommunications providers to install communications use equipment or facilities—including for broadband Internet—on federal property. However, GAO found that from fiscal years 2018 through 2022, these agencies lacked accurate and complete data needed to determine the processing time for 42 percent and 7 percent, respectively, of their communications use applications. These agencies also lacked the necessary controls to ensure staff entered key information, such as start and end dates, in their electronic systems. A more recent study concluded that there are no recent data on the costs that wireless providers face when complying with NEPA and NHPA. Using data obtained through surveys and working sessions, it estimated that mobile wireless providers would spend over $2.2 billion on regulatory compliance within the next decade.

While H.R.2289 will certainly help companies obtain federal licenses faster and with less expense, state and local requirements may be less amenable to reform. The ABDA has generated significant opposition from state and local agencies. As part of its broader efforts to reform regulations, the FCC has initiated two important proceedings to eliminate unnecessary delays in broadband deployment imposed by state and local governments. These include a Notice of Inquiry focused on eliminating barriers to wireline deployments and a Notice of Proposed Rulemaking for wireless deployments. Both efforts attracted a large number of public comments including from trade associations detailing several projects experiencing cost and schedule increases that seem unrelated to the true cost of access to public land.

Permitting reform is much needed. Hopefully, the American Broadband Deployment Act and other related legislation implementing permitting reform will be speedily adopted. And, in any event, the FCC's own efforts will still be important.

Tax Day Reminds Us That Marylanders Are Voting With Their Feet

Ahead of Tax Day, a new report from personal-finance company WalletHub ranks Maryland as 7th in the nation for the highest state tax burden on personal income – Maryland residents send 9.7% of their personal income to state coffers. And that's on top of the money residents pay in federal income taxes and in various state service fees, such as recent increases for vehicle requirements.

Income taxes, specifically, are the main driver of Maryland's high tax burden ranking, according to WalletHub. Maryland places 3rd in the nation for the highest income tax burden, with 4.3% of residents' personal income going to the state through that channel alone. WalletHub also examined property taxes and sales and excise taxes, where Maryland scored better. Maryland places 29th for property taxes (2.5% of personal income to the state) and 40th for sales and excise taxes (2.9% of personal income to the state), meaning it's the income tax load that pushes the overall state’s overall personal tax burden so high.

Maryland’s high tax burden is a major reason for Maryland’s outmigration problem. Even an analysis by the Maryland Chamber of Commerce last year featured Maryland’s troublesome outmigration, explaining that Maryland ranks near last in domestic migration – 45th in the nation. Maryland did have net positive migration in the year examined (July 2023 - July 2024), but that was because of international arrivals (53,100), which masked Maryland residents moving to other states (18,500).

The Chamber of Commerce analysis explained the state’s serious situation: "High taxes, rising living costs, housing affordability challenges and regulatory complexity are pushing residents to states with lower costs, better growth prospects, and more business-friendly climates." The top destinations include Florida, Texas, Virginia, North Carolina, and Pennsylvania – all states that offer lower or no income taxes.

If residents continue leaving for lower-tax, lower-cost states, Maryland may find itself caught in a fiscal cycle or downward spiral that's difficult to reverse – fewer taxpayers and even less room to reduce the burden on those who stay.

The FCC Should Not Mandate the Next Gen TV Transition

Communications is one of the most innovative sectors of the U.S. economy. Industries ranging from broadcasting, smart phones, over-the-top Internet, cable, and satellite are battling for a larger slice of the market for entertainment and communication, broadly defined. So far, the secret to success has usually been the introduction of a new technology or business model that improves users’ experience. Regulators should welcome this type of marketplace competition since it produces faster growth and better living standards. It also helps boost U.S. competitiveness in a strategic competition against international challengers.

However, companies sometimes engage in another form of competition. That is, seeking to pressure regulators to give their own preferred technology or standards an advantage by adopting rules that favor them. This can be done by forcing competitors to use a favored regulatory standard or discouraging the use of a rival one. Either option conveys a competitive advantage in the marketplace. While it is normally preferable for companies that may compete with each other to face similar regulatory burdens, this is almost always better achieved by lowering the total burden rather than increasing it. Specifically, regulators should be very careful not to favor one technology over another absent compelling circumstances.

 

Unfortunately, this is exactly what the broadcasting industry is advocating as it asks the FCC to make the new Next Gen TV standard (also known as ATSC 3.0) mandatory. This would force households, broadcasting stations, and cable and satellite providers to purchase new equipment to meet the standards. It is not that the standard is per se bad. A number of broadcasters have voluntarily adopted Next Gen TV on their own. The underlying objection is that making Next Gen TV mandatory would foreclose the ongoing competition between it and other standards, including the existing one, and remove the pressure to improve them over time.

The broadcasters’ request has attracted opposition, including from cable and satellite operators who would have to adopt Next Gen TV in order to deliver broadcasters’ channels to their subscribers. The broadcasters are also requesting that the FCC should set a firm deadline ending use of the current ATSC 1.0 signals. This would force everyone to switch over to the new standard. Viewers would have to buy either converters to translate the new standard or new televisions with the new tuners.

As the NCTA writes: “[T]he cable industry does not oppose broadcasters’ use of new technologies. We simply believe that broadcasters’ transition to a new standard should not come at the expense of [multichannel video programming distributors], equipment manufacturers, and consumers, with no guarantee of meaningful benefits.”

The FCC may lack the power to do what broadcasters are requesting. As the NCTA points out, current must carry requirements were passed when it was possible to argue that cable carriage was necessary to protect free, over-the-air broadcasting because there was little competition between content providers. Since then there has been an explosion in video offerings. In addition to the traditional over-the-air broadcasters, many homes can choose between cable, satellite, fiber, and over-the-top content on the Internet. The rationale for regulation is much weaker now.

In addition, courts have adopted less deferential standards for reviewing agency action, especially for issues of “vast economic and political significance,” unless Congress has clearly empowered the agency with authority over the issue. FCC rules may not survive a challenge under the new doctrine. The NCTA argues that forced conversion, by requiring significant costs, would represent a taking and force their members to carry certain broadcasts against their will.

Continued innovation in the communications marketplace over the next decade will be much faster if two conditions are met. The first is that new technical standards are welcome provided they increase value to consumers. Second, such new standards will need to spread through voluntary adoption driven by consumer demand. The FCC should not favor one set of standards over others.