High-Speed Internet Rules Might Prove Costly
Proposed regulation of high-speed Internet service providers by the U.S. government could cost the economy at least $62 billion annually over the next five years and eliminate 502,000 jobs, according to a study released by New York University Law School. The report estimates that broadband providers and related industries may cut their investments by 10 percent to 30 percent from 2010 to 2015 in response to additional regulation. At 30 percent, the economy might sustain an $80 billion hit, according to Charles Davidson, director of the law school’s Advanced Communications Law & Policy Institute, which released the report on June 16.
The study’s authors believe regulation would reduce service providers’ willingness to invest by shrinking their revenue opportunities. For example, they say service providers wouldn’t be able to offer a hospital a higher-quality network service needed for telemedicine applications. “A lot of telemedicine services are real-time in nature,” says Davidson. “If network owners are not allowed to manage their networks to allow for reliable delivery of those services, then we’ll see those services not developing as they should.” The study is one of several in recent months to warn that net neutrality regulation may lead to lower investment and job losses in telecom and other industries.
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