Title II’s real-world impact on broadband investment

[Commentary] It is a fundamental truth in economics and finance that lower returns or higher risks decrease incentives to invest. Combining the two spells double trouble. The Federal Communications Commission delivered just such a double whammy with its Open Internet Order when it chose to place new, yet often unspecified restrictions on Internet Service Providers (ISPs). Almost as if on cue, investments in broadband dropped in the US.

What economists observed decades ago remains true today: (1) Limiting businesses’ options decreases investment value; and (2) There is a need to put distance between the short-term political priorities and long-term infrastructure investment planning. If we continue to fail in that, we will shackle our broadband infrastructure.

[Mark Jamison is the director and Gunter Professor of the Public Utility Research Center at the University of Florida]