The debate over broadband policy transcends national boundaries and has become even more important in the current economic environment as the financial crisis leads the U.S. to include broadband in its economic stimulus efforts and the EU to consider something similar. Since the mid-1990s information and communications technologies have contributed substantially to economic growth, productivity improvements, and, thus, higher living standards on both sides of the Atlantic.
High-speed data connections, or broadband, are critical to the economy. Our work on broadband covers a wide range of topics, including the digital divide, wireline and wireless provision, spectrum, net neutrality, competition, and more.
71 economists explain why the National Telecommunications and Information Administration and The Rural Utilities Service should use competitive procurement auctions to allocate the broadband stimulus grants. The economists, in comments submitted to the NTIA and RUS, explain “why procurement auctions are more efficient and more consistent with the stimulus goals of allocating funds quickly than a traditional grant review process.”
The signatories are economists who have studied telecommunications, auctions, and competition policy and include two Nobel Laureates and three winners of the John Bates Clark medal for the best economist under 40. The comments were coordinated by Paul Milgrom, Gregory Rosston, and Andrzej Skrzypacz of Stanford University, and Scott Wallsten of the Technology Policy Institute. Thomas Lenard of TPI is one of the signers of the comments.
DSL unbundling is negatively correlated with new fiber investment, according to new research by TPI Vice President for Research and Senior Fellow Scott Wallsten. Similarly, platform competition (cable and facilities-based DSL providers) is positively correlated with fiber deployment. Wallsten’s paper uses a new dataset to examine empirically the effects of unbundling on investment in new fiber networks in Europe.
Net Neutrality, Unbundling, and their Effects on International Investment in Next-Generation Networks
Network neutrality has been a contentious issue in the United States for several years, but is increasingly debated elsewhere, with the EU, several European countries, and the Japanese government all examining the issue.
The newly enacted economic stimulus package includes $7.2 billion in grants, loans, and loan guarantees to bring broadband to rural areas lacking high-speed Internet services. The American Recovery and Reinvestment Act of 2009 charges government agencies not only with choosing grant recipients and setting performance benchmarks, but also with measuring results. Only a carefully preplanned evaluation strategy will enable them to accurately assess the effectiveness of the broadband stimulus.
The recently enacted $7 billion broadband stimulus plan presents a unique opportunity to learn what kinds of broadband subsidies can make a difference, Technology Policy Institute Vice President for Research and Senior Fellow Scott Wallsten explains in a new article.
On March 12, 2009 TPI Vice President for Research and Senior Fellow Scott Wallsten testified before the House Energy and Commerce Committee, Subcommittee on Communications, Technology, and the Internet on reforming the universal service high cost fund. Subsidies from the high-cost fund to rural telecommunications providers have increased from $1.7 billion in 1999 to nearly $5 billion today. Wallsten recommended moving from the current inefficient system to one that awards subsidies through competitive bidding. Such reverse auctions for universal service have been used successfully in other countries and could reduce subsidies and benefit consumers.