Free Press: AT&T investments are proof Network Neutrality doesn't hinder broadband
Submitted: October 21, 2009 - 8:49pm
Originally published: October 21, 2009
Last updated: October 21, 2009 - 8:51pm
Originally published: October 21, 2009
Last updated: October 21, 2009 - 8:51pm
Source:
IDG News Service
Author:
Grant Gross
Free Press disputes the often-claimed criticism that new Network Neutrality rules will hurt broadband investment by pointing to investments made by AT&T when the telecom giant was subject to similar regulations. AT&T, as part of conditions it agreed to in its late-2006 merger with BellSouth, agreed to Net neutrality rules for two years, and the telecom's investments increased significantly during that time period, the Free Press study finds. AT&T's gross capital investment increased by nearly $1.9 billion from 2006 to 2008, the largest increase among U.S. telecoms. The percentage of capital investments to revenue at large telecom carriers has actually fallen since the FCC relaxed network-sharing regulations in 2005.
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While the arguments about network neutrality and investment are not easy to parse, both the points made here are flat out wrong.
First, fiber investments have a lifetime of say 15 or 20 plus years. Consequently, a two year application of net neutrality is hardly relevant, especially given AT&T's commitment to U-verse had already been made.
Second, the important change in this respect, was not the dropping of UNE-P, which amounted to a discounted form of resale (UNE-L was left in place, ), but that the FCC had decided in decisions in 2003 and 2004 to forebear regulating next generation networks such as Verizon's FiOS and AT&T's U-verse.
It was those earlier FCC decisions that led to AT&T's and Verizon's respective investments in FTTN and FTTP.
In short, investment followed regulatory forbearance.