A new report studying the impact of newly proposed network neutrality regulations warns that as many as 1.5 million jobs could be lost by the end of the decade if the Federal Communications Commission implements the regulations.
The study, called “The Employment and Economic Impacts of Net Neutrality Regulation: An Empirical Analysis,” was conducted by economist Coleman Bazelon at The Brattle Group and sponsored by Mobile Future. Mobile Future is a 501(c)(4), a lobbying group of businesses, non-profit organizations and individuals that advocates for an environment that encourages innovation in wireless technology and services. AT&T is the only telecommunications carrier listed on the group’s website and easily the largest company among the organization’s listed members.
The white paper assumes that the FCC would implement proposed net-neutrality regulations in the strictest manner.
“As the FCC undertakes the next steps in its important review of proposed rules to preserve an open Internet in the U.S., it should carefully avoid implementing policies that will hinder its attempts to promote universal access to high-speed broadband in America. Nor should it adopt policies that would negatively impact the U.S. economy or the jobs outlook. As this analysis suggests, strict network neutrality rules of the type proposed by the FCC would be one such counterproductive policy. If implemented, network neutrality rules could lead to a broadband sector that is almost 18% smaller than it would otherwise be by the end of the decade,” according to the paper.
Key findings of the white paper include:
• Revenue growth in the broadband sector could slow by about one-sixth over the next decade;
• Broadband sector jobs lost could total 342,065 jobs by 2020;
• And the total impact on the economy could be 1.45 million by 2020 due to reduced revenue growth in broadband.
Further the author finds that wireless broadband growth would be most impacted because it has the most potential for growth. Bazelman forecasts that revenues from mobile broadband lines will overtake revenue from wireline broadband lines by 2013.
“Some proponents of more comprehensive network neutrality regulation proposals have suggested that job losses in the broadband sector might be offset by increased employment in the Internet content sector. This conclusion seems highly unlikely for at least three reasons. First, there is no a priori expectation of any net increase in jobs in the Internet content sector. Second, the potential losses in the broadband sector are large, thus creating a significant employment benchmark that would need to be exceeded by new employment in the Internet content sector for there to be a net increase in jobs. Third, jobs in the Internet content sector are more expensive than jobs in the broadband sector in that it takes more spending on Internet content to create a U.S. job than it does in the broadband sector.”
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