California’s law fills a gap in federal rules. A Federal Communications Commission proposal to let tenants opt out of bulk billing was floated in March 2024 by then-FCC Chairwoman Jessica Rosenworcel, but not adopted.
When Rosenworcel proposed a federal opt-out rule last year, the FCC said it would “increase competition for communications service in these buildings by making it more profitable for competitive providers to deploy service in buildings where it is currently too expensive to serve consumers because tenants are required to take a certain provider’s service.” But the proposal was nixed in January 2025 by Chairman Brendan Carr, shortly after President Trump elevated Carr to the FCC’s top slot.
If a California landlord offers bulk billing and fails to comply with the new law’s opt-out requirement, the landlord’s tenants will have the right to “deduct the cost of the subscription to the third-party Internet service provider from the rent.” The law prohibits landlords from retaliating against tenants.
Bulk billing contracts are generally allowed by the FCC, except when they give a provider the exclusive right to access and serve a building. Landlords can still prevent other ISPs from installing wires in a building, though.
“While a service provider may not enter into an agreement that grants exclusive access to an MTE [multiple tenant environment] property, a landlord may still choose the providers it allows into the building, even if that means only one company provides service,” the FCC says. While residents may still only have one choice for wired broadband, the California law could help fixed wireless Internet providers gain subscribers.
The California Broadband & Video Association told the Sacramento Bee that it is disappointed Newsom signed the bill “because we think it will be an impediment to utilizing an effective tool, bulk billing, that has helped middle class Californians be eligible for discounted rates to high-speed Internet. We will endeavor to do our best and continue to provide quality services at affordable rates.”
