I never paid much attention to what they got up to before the feds stepped in but I kind of doubt it was a last mile problem, once the packet got that far why mess with it?
But, knowing California, they'll do one of those "...and any packet destined for a customer in California."
Ignoring the around the world latency and assuming CA has a trans-pacific pipe to asia they could route all CA traffic out of country first. Would this disregard the "interstate" premise?
(talking hypothetical here)
The Commerce Clause has been ruled to apply to something you grow in your own backyard and consume yourself because of a theoretical impact on the national market: https://en.wikipedia.org/wiki/Wickard_v._Filburn So it's very easy to see how regulating state internet regulations also falls into the purview of the federal government from there.
The modern 'conservative' stance towards the affairs of the day.
I just see it as opportunity to hone my subtle trolling skills.