Government-Owned Broadband Networks: Do They Reduce the Cost of Broadband and Increase Adoption?

The study examines the dangers of government-owned broadband networks and warns that increasing the number of government-operated networks (GONs) would do little to lower their costs or increase broadband subscribership. Specifically, the study highlights the significant historical failures of GONs, and how they have left taxpayers on the hook for millions of dollars in government debt and forced consumers to pay higher prices for other municipal utility services to make up for operational losses. Key findings:

• The long history of GONs failures teaches us that public ownership of broadband networks is a bad policy for serving consumers, encouraging competition, and promoting innovation;
• Municipal broadband networks crowd out private investment and competition;
• These networks are more inefficient when compared to private networks; and
• GONs providers often lose money and then shift these costs to taxpayers and other public utility services – meaning the effective price paid by consumers is ultimately much higher than advertised.