AT&T Kills Internet Service in NY Instead of Providing Discounted Plans to Low Income Households

On Wednesday, New York’s Affordable Broadband Act, which requires large internet service providers to offer affordable broadband plans to low-income households, went into effect. On the same day, AT&T announced that it would be pulling its 5G home internet service from the state entirely, choosing to not sell it to anyone rather than have to offer a discount.

New York’s law, which took nearly four years to actually be enforced thanks to contentious and constant legal challenges from lobbying groups that just so happen to represent AT&T, requires any ISP with more than 20,000 customers to offer two discounted plans: a $15 a month broadband plan with download speeds of at least 25Mbps and a $20 a month plan with speeds up to 200Mbps. Under the law, households that qualify for social benefits like National School Lunch Program, Supplemental Nutrition Assistance Program, or Medicaid are eligible for the discounted plans.

For reference, about 1.7 million households in New York currently receive SNAP benefits. That is also about the number of homes in the state that once qualified for the Federal Communications Commission’s Affordable Connectivity Program, which offered $30 benefits to help people afford internet service but ended earlier this year after Congress failed to re-up funding for the program. So hey, perfect time for the state to step in and keep their citizens connected.

AT&T had other plans. The company, which reported $30.2 billion in revenue during the third quarter of 2024, said that “New York’s broadband law imposes harmful rate regulations that make it uneconomical for AT&T to invest in and expand our broadband infrastructure in the state.”

The idea that New York’s law would dramatically affect AT&T’s bottom line seems a bit implausible when you think about it. The service the company is pulling from the state is its AT&T Internet Air service, which it launched in 2023 and costs $60 a month. The company offers it primarily as a service to rural areas where it has no intention of laying fiber, and it relies on its 5G network to deliver broadband-level speeds. It’s a much smaller part of its customer base than cellular users, the primary users who give AT&T reason to expand its infrastructure. Offering discounted deals to low-income households is really going to stifle that? It’s not clear the math adds up there.

(Just a quick reminder here that AT&T has come under fire in the past for digital redlining—intentionally choosing not to build infrastructure to offer services in low-income areas, which disproportionately affects marginalized communities.)

For New Yorkers who already subscribed to AT&T Internet Air, the company is offering 45 days of free service so they can find a new provider. The company will continue to offer 5G cellular plans (which, again, is the same network as Internet Air uses) since those don’t qualify for a discount under state law. It will also offer fiber services, though it has a pretty small footprint in New York.