Study Backs Title II's Negative Impact
A new study from the Georgetown Center for Business and Public Policy claims to substantiate concerns that the FCC's recent move to re-regulate broadband ISPs will significantly affect investment and innovation in US networks.
The Federal Communications Commission (FCC) decided earlier this year that the best way to ensure net neutrality was to impose Title II regulations -- those applied to telecom services -- to broadband Internet access services as well. (See FCC Adopts Title II Rules .)
According to this study's co-authors, Robert Shapiro, a senior policy scholar at the Georgetown Center who served in the Clinton Commerce department, and Kevin Hassett of the conservative American Enterprise Institute, there is empirical evidence that Title II regulations will negatively affect investment in broadband networks by as much as 20%, based on how regulation has impacted investment in other countries.
The full text of the study can be found here.
Major telecom network operators including telcos and cablecos argued in advance of the net neutrality decision that re-regulation would stymie their investments, but those arguments were largely dismissed by FCC Chairman Tom Wheeler and those backing the more aggressive move to re-regulate in order to guarantee net neutrality. (See Wheeler to Cable: Suck It Up and Allot Reports Q1 Sales Growth.)
Pat Brogan, industry analyst with the United States Telecom Association (USTelecom) , the national trade association for the telecom network operators, which filed a suit against re-regulation, said today in a blog that this study proves those concerns aren't overblown. Ongoing uncertainty, at the very least, calls into question investments going forward, he notes, especially with an election cycle looming. (See Net Neutrality Suits: Only The Beginning?)
"The authors examined the impact of regulation on investment under different levels of regulatory intensity among industrialized Organization for Economic Cooperation and Development (OECD) countries in the first decade of the 21st century," he wrote in a blog. "They found that regulation had a significantly negative impact and predicted that the US could face a similar outcome as a result of Title II regulation of broadband."
The report could renew the ongoing debate about Title II re-regulation in advance of court appeals that are pending.
— Carol Wilson, Editor-at-Large, Light Reading