Why Renters Could Actually Win If the FCC Drops Its Multifamily Cable-Wiring Rule

At the Real Estate Technology and Transformation Center (RETTC), we champion technology that does two things: helps owners operate more efficiently and affordably, while also improving the resident experience. We firmly believe that real estate technology is a force for good. When innovation thrives, competition follows and the consumer benefits.  

That outlook is why RETTC—along with our partners at the National Multifamily Housing Council (NMHC)—recently filed comments with the Federal Communications Commission (FCC), urging the agency to repeal outdated, complex or unnecessary regulations that limit competition, stymie innovation and raise costs for both housing providers and renters.

The Backstory 
The FCC’s “inside-wiring” rule dates back more than 20 years. It was meant for a different era, when most pay-TV hookups ran to single-family homes. Things are different today. This rule may have made good sense for suburbs in the 1990s, but it makes no sense—none at all—for Wi-Fi-hungry residents in apartments today. 

Originally, the rule required cable providers to give homeowners a chance to buy the wiring in their homes if the homeowners decided to unsubscribe and switch providers. The idea was to prevent cable providers from “locking up” the last 50 feet of cable infrastructure and thereby gaining an unfair competitive advantage. The rule accomplished its goal while still respecting the basic property rights of the cable providers themselves: The providers weren’t required to give away the cable wiring they had installed. The homeowner had to buy them out of it.  

At that time, this might have been an elegant solution to an important problem. Whether it remains so is another question, and besides, it’s clear that this rule shouldn’t be applied to multifamily properties. Here’s why:

1. Applying the rule to multifamily properties is illogical and unworkable. Many renters move frequently and renters, by definition, do not own the property where they live. Yet in the name of improving competition, the FCC revised the cable inside-wiring rule to allow renters to purchase the wiring within their units. This defies all common sense. No one thinks that allowing renters to own their plumbing infrastructure or their electrical wiring would increase competition among local plumbers and electricians. It would, however, jeopardize access to these essential services for future residents of the unit. Likewise, if a renter were to buy the wiring within their unit, the next resident would not only be robbed of the ability to do the same, but they would also face potential barriers to access for video or internet service.
2. The rule doesn’t reflect the physical reality of cable wiring in multifamily buildings. In large buildings, the wiring for a given unit doesn’t start and end within that unit as it does for single-family properties. In most large apartment buildings, the wiring runs from each unit back to a common point in the building, where it connects to the provider’s broader infrastructure. Even if the resident purchased the wiring inside the unit and the wiring running back to the common point, they would have no control over that wiring if it needed to be maintained or upgraded, or if other work were being done nearby in the building.
3. More red tape means higher costs and less service. Applying the FCC cable-inside wiring rule to apartments creates headaches and uncertainty that ultimately discourages the deployment of video and broadband infrastructure in multifamily housing. In practice, most providers prefer to control the wiring they use because that way they can retain control over technical standards and quality of service. Uncertainty is also a key concern for marginal properties in markets that are already struggling to attract investment. And it’s also true when you consider the cumulative impact of other overreaching regulations. In the end, these rules add no value for consumers and no value for property owners, but they can add plenty of costs.  

In theory, letting individual renters buy the cable wiring inside their units may sound empowering, but in practice it confers the renter no meaningful control and jeopardizes service access for future renters. Moreover, layering single-family rules onto multifamily buildings creates an unworkable situation. It raises costs, increases uncertainty, and discourages investments in housing, video and even broadband services. The end result is the opposite of what the FCC and the broader public want: It leads to less private sector investment in broadband infrastructure, less quality service, less competition and higher costs for everyone.