SF supervisor would give tenants access to all Internet providers

When Kevin Hsiung moved into his brand-new apartment on San Francisco’s Potrero Hill, he wanted what every tenant wants: the best deal on Internet service. He did his research, found the company he liked and set about getting the service. Then he ran into an unexpected problem.

The property manager for the 453-unit building told Hsiung he could sign up only with AT&T or Comcast.

“They wouldn’t tell me why,” said Hsiung, who eventually went with Comcast, even though he preferred Webpass, which provides superfast Internet access.

On Tuesday, Supervisor Mark Farrell will introduce legislation that would require property owners to give building access to all state-licensed providers. He said Hsiung’s experience is increasingly common, although there have been no independent studies done on the issue in San Francisco.

“The reality in San Francisco is that tens of thousands of residents have been denied access to different Internet service providers,” Farrell said. “I fundamentally believe competition is a good thing that will ultimately drive prices down and improve Internet access across all of San Francisco.”

Groups that represent property owners say Farrell vastly overstates the problem and that the legislation is ill-conceived.

“We don’t need laws telling us we have to allow any company into our buildings. We have concerns about safety, about the physical space,” said Ken Cleaveland, vice president of public policy for the Building Owners and Managers Association of San Francisco. “We think everything should be dictated by leases — you write what kind of services you provide into the lease.”

Federal law says property owners can’t prohibit tenants from signing up with their preferred service provider. However, the law allows owners to have revenue-share agreements with companies that provide television, phone and Internet services — meaning the owners make money when tenants sign up with those companies. The practice is common in large, new rental apartment buildings.

So while property owners can’t stop tenants from signing up with competitors, they can refuse to allow those competitors access to the building to install fiber and antennas, effectively preventing them from providing service.

Tenants in small apartment buildings sometimes run into the same problem, but for different reasons. The owners don’t want to deal with the hassle of accommodating new equipment or giving rent-controlled tenants more incentive to stay, according to frustrated customers and companies.

Farrell’s legislation says property owners could seek “just and reasonable compensation” from service providers for using their property, but they would not be able to refuse access outright. If disagreements arose about the “just and reasonable” compensation, the parties could go to court to resolve them. Property owners who refused access could be fined up to $500 a day.

Charles Barr, founder of Webpass, which was recently acquired by Google Fiber, said there are roughly 400 large apartment buildings in San Francisco that deny his company access to their property.

“Some don’t want fiber in the building or don’t want a radio in the building or don’t want anybody other than AT&T to come in,” he said.

But the biggest barrier, Barr said, is that some big apartment buildings will allow Webpass access only if it pays the owner a small monthly fee per subscriber — which Webpass refuses to do. Farrell’s legislation would prevent owners from demanding a subscriber fee.

Barr said Equity Residential, which owns 1010 16th St., where Hsiung lives, is one of those companies. A spokesman for Equity denied that the company seeks subscriber fees, but acknowledged it had refused to allow Webpass to access Hsiung’s building. The spokesman said the company was working on bringing Webpass services to tenants in the near future.

While the issue of Internet choice arises most frequently in large apartment buildings, tenants in smaller ones also report being stymied.

Trent Robbins, who lives in a 12-unit building in the Sunset, wanted to purchase gigabit-speed Internet through Sonic. Sonic planned to drill into the side of the apartment building to run fiber into Robbins’ apartment. The landlord balked.

Sonic said it could find a less invasive way to install service, but the landlord refused to let the company try, Robbins said. He is hoping other tenants pressure the landlord to change his mind. Farrell’s legislation indemnifies property owners for damage done to their property.

“Literally everywhere in the West except the United States has some form of gigabit available,” Robbins said. “It’s a reasonable modification to an apartment, and I think I’m within my rights.”

But Charley Goss, government and community affairs manager with the San Francisco Apartment Association, said his group would consider suing if Farrell’s legislation becomes law.

“There is federal law that already governs all of this. We would prefer the city enforce that law rather than write new laws,” Goss said.

And, he added, landlords don’t need more rules telling them what they can and can’t do.

“We are the highest-regulated industry in San Francisco and one of the highest in California,” Goss said. “And it kind of gets to a point where enough is enough.”