Does Line Sharing Increase Broadband Deployments?

from the depends-on-how-you-craft-the-study dept

A new study has come out, saying something that seems fairly obvious, but which seems to miss an important point. It deals with the ongoing debate over whether or not the FCC should get rid of line sharing rules for broadband providers. The report claims that, without low regulated line sharing rules, there would be fewer broadband deployments, because the prices would be higher. The report doesn’t even look at whether line sharing rules should be ditched, but whether the rates should be kept lower. The results are pretty obvious, of course. Cheaper rates should lead to more deployments. What is left out of the equation, however, is what kind of impact this has on alternative forms of broadband competition — which is exactly what the FCC is thinking about. If existing DSL providers do end up raising rates, then (the theory goes) it just gives more incentive for broadband alternatives that route completely around the current network owners to hit the market. All of the current talk about broadband wireless (and even, unfortunately, powerline broadband) offerings should make that clear. That’s not to say the alternatives will automatically succeed (and the way most seem to be going about it right now, it looks like there will be plenty of failures to talk about). However, what the debate really is about is whether competition should be stimulated within existing DSL networks or outside existing DSL networks. What this report basically says is that if the FCC tries to increase competition outside of existing DSL networks, it will mean less deployments for those DSL networks — which is exactly what the FCC is trying to do. To understand the real impacts of trying to stimulate demand outside of existing networks, shouldn’t any study also look at what happens with alternative providers?

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