What is the Effect of Regulation on Investment?

May 8th, 2012 | Posted by George Ford in "Over the Top" Services | AllVid | Broadband Credibility Gap | Data Roaming | Employment | Federal Communications Commission | Industry Structure and Market Performance | Interoperability | Jobs | Law and Economics | Net Neutrality | Regulation | Regulatory Reform | Set-top Boxes | Spectrum | Spectrum Caps | Wireless - (0 Comments)

What is the effect of regulation on investment?  At a high level of abstraction, it is impossible to say.  Rate-of-return regulation, for example, is criticized by economists for possibly encouraging too much investment—a principle known as the Averch-Johnson Effect.  On the other hand, if a firm fears that the regulator will alter the rules in a way that reduces the ability to earn profits on large, long-term capital investments, then the incentive to make such investments is reduced.  Importantly, the issue is not, as some claim, just about “regulatory uncertainty.”  There could be great uncertainty about future rule changes, but if the expectation is that … Read more →

Should Content Providers be Allowed to Contribute to the Cost of Mobile Bandwidth?

March 2nd, 2012 | Posted by George Ford in "Over the Top" Services | Federal Communications Commission | Mobile Broadband | Net Neutrality | Network Agnostic Devices | Spectrum | Spectrum Caps | Spectrum Exhaust | Wireless - (Comments Off)

A recent article in the Wall Street Journal caught my attention, and I’m sure the attention of many others.  The article—AT&T May Try Billing App Makers (February 28, 2012)—reported that AT&T and content providers were discussing ways in which the providers of mobile content, like video streaming, could pay for (in whole or part) the cost of the data traffic on behalf of the end user.  According to the article, the interest in a content-payer system is being encouraged by content developers that “could use the feature to drum up new business from customers wary of using data-heavy services like mobile video” in a world … Read more →

Final Thoughts on CES: The Rise of the Network Agnostic Device…

January 20th, 2012 | Posted by George Ford in "Over the Top" Services | Federal Communications Commission | Industry Structure and Market Performance | Law and Economics | Net Neutrality | Network Agnostic Devices | Regulation | Wireless - (Comments Off)

While attending the Consumer Electronics Show last week, FCC Chairman Julius Genachowski observed in his speech to the assembled technology glitterati that “… virtually every new product on the CES floor is fueled by broadband Internet—by connectivity and bandwidth, wired and wireless.  If you shut off the Internet, virtually nothing on the CES floor would work.”  Certainly, the rapid innovation in edge devices is a wonderful thing.  But, such innovation may not be traveling alone.   That is, economic theory suggests this rapid increase in the number and sophistication of edge devices may be accompanied by an increase in the intensity of price competition among broadband … Read more →

More Observations From CES…

January 19th, 2012 | Posted by Larry Spiwak in "Over the Top" Services | AllVid | Cable | CableCard | Federal Communications Commission | MVPDs | Regulation | Set-top Boxes - (Comments Off)

One of the major stories that came out of CES last week was (in the words of the Wall Street Journal) the “flood” of new Internet content and mobile devices reaching consumers’ living rooms.  In fact, this has been the story coming out of CES for the past few years.  Given such developments, it continues to puzzle me not only that the FCC refuses to announce, at least formally, that it intends to drop its ill-conceived AllVid paradigm, but that it also refuses to announce that it intends to seek to sunset Section 629 of the Communications Act altogether. By way of quick background, Section … Read more →

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