^{Democracy & Technology Blog} Telecom crash redux

The FCC’s newest plan for seizing control of the last-mile broadband connections we all use to access the Internet would classify broadband as a ‘telecommunications service,’ which will put the FCC under constant pressure to resurrect the “unbundling” regulations that precipitated the telecom crash of 2000 by requiring owners of last-mile links to homes and offices to share their lines with rivals.
Remember the CLECs? They were essentially a hothouse product of regulation, and they not only failed to deliver bandwidth but they brought down the whole high tech economy. As a result of that carnage the FCC drew back, last-mile bandwidth was declared to be an ‘information service,’ and thus not subject to the labyrinthine rules that were applied before as if they were voice telephone lines.
With business investment flooding into this arena ever since, the U.S. has accomplished a broadband miracle, with residential bandwidth up 54 fold, wireless bandwidth to consumers up 542 fold.
With sufficient investment in bandwidth, carriers will have no economic incentive to discriminate. If bandwidth is scarce, carriers will be forced to set priorities or else slow everything down to the lowest common denominator.
Investment is what determines whether there is abundance or scarcity and whether network neutrality in practice is just a carnival for lawyers to litigate telecom and Internet companies.
Nothing can so wither broadband investment as murky mandates from Washington.