Impact of Broadband Rate Regulation on Investment

This report examines the impact of broadband rate regulation on investment and competition within the broadband market. It outlines the growing concern among broadband providers regarding state-level price regulation, which is perceived to inhibit investment and competition. The study, prepared by Cartesian, assesses the effects of various regulatory scenarios on revenue and investment levels. It details how even mild forms of rate regulation can significantly reduce revenues, leading to decreased investment in broadband infrastructure, particularly in rural areas. The report highlights that fewer competitors would emerge in regulated markets, resulting in reduced consumer choice and potentially higher prices. The findings suggest that the current competitive landscape in the broadband industry, characterized by significant investments and technological advancements, could be jeopardized by regulatory interventions. The objective of the study is to provide policymakers with insights into the economic implications of broadband rate regulation, emphasizing the need for a balanced approach to promote broadband access without stifling market dynamics.