Would FCC Plan Harm Telecom Investment? Even Industry Opinion Is Mixed

Federal Communications Commission Chairman Tom Wheeler is expected to propose reclassifying the Internet under regulations known in the parlance of telecom wonks as Title II. Big cable and phone companies warn that would stifle investment and cost consumers more, but the truth may be more complicated.

This policy shift is what many Internet companies and public interest groups say is what the commission needs to do to stop broadband companies from charging extra to get information to consumers faster. But phone and cable companies warn that Title II would be a disaster. "These regulations that we're talking about are public-utility-style regulations, and this industry's moving fast," said AT&T CEO Randall Stephenson. "And if you can't bring new products to service at your speed, not the government's speed, why would you ever make these investments?" Broadband industry executives have told the same story on Capitol Hill. But Fran Shammo, the chief financial officer of Verizon, seemed to go off script when he was asked about Title II at an investor conference in December. "To be real clear, I mean, this does not influence the way we invest," Shammo said. "We're gonna continue to invest in our networks and our platforms. Nothing will influence that."

The differing messages don't necessarily result from a difference of opinion, but a difference of audience, says Susan Crawford, co-director of the Berkman Center for Internet & Society at Harvard University.