Infrastructure Investment After Title II

USTelecom recently released an update to its US broadband industry capital spending series. In this update, USTelecom reported that sector investment rose $1.5 billion (or 2%) between 2016 and 2017—a reversal of a two-year decline following the 2015 Open Internet Order. In this Perspective, I look at changes in capital spending beginning in 2015 (as measured by USTelecom) with the aid of a counterfactual constructed with guidance from the analysis of investment effects from the 2018 Restoring Internet Freedom Order. I find that while the decline in capital spending rose in 2015 and 2016 stopped in 2017, investment in the telecommunications sector is materially compressed, being about $10-to-$13 billion (or 12-to-15%) below expectations. As measured here, about $24-to-$30 billion in investment has been lost to the Title II drama since 2015. At a time when policymakers are seeking increased investment in broadband networks, disputes over the regulatory classification of Internet access, which may materially diminish investment incentives, appear to be counterproductive. A more temperate approach to Net Neutrality, perhaps delaying action until some material breach is observed, may be a better regulatory approach.