Wall Street Calling Telcos' Bluff On Stopping Investment If Net Neutrality Put Into Law

from the give-it-up dept

While we're still worried that any "net neutrality" rules put in place by the government will contain so many loopholes for the telcos as to make them do more harm than good, it's nice to see that more and more people are calling the telcos on their bogus claim that net neutrality rules would mean that telcos would cut back on investment. Lots of us have debunked that claim before, but the telcos have tried to make the case that this is a big deal for Wall Street people. Eh... perhaps not so much. Broadband Reports notes that even the Wall Street analysts who are against net neutrality rules don't believe it will impact investment:

Net neutrality/reclassification opponent Thomas Seitz (Height Analytics and previously Barclay) today joined the parade of top analysts doubting the claims that Net Neutrality rules would produce a serious cutback in broadband investment. Washington is inundated with claims NN will clobber investment, but the carrier CFO are telling Wall Street it won't be a determining factor. Seitz joins John Hodulik of UBS (voted #1 telco analyst), Craig Moffett (voted #1 cable analyst) and Michael Rollins of Citigroup as well as several others who haven't gone on the record.

As we've seen over and over and over again, telcos invest when there's competition in the market. When competition goes away, that's when they cut back. If the focus is really on encouraging investment in network infrastructure, then the focus should be on encouraging more competition in the marketplace -- which is exactly what the telcos don't want. They like their monopoly rents. They like not having to invest as much in infrastructure. It's great that more and more people are calling them on this bogus claim.

Filed Under: infrastructure, investment, net neutrality, telcos, wall street