In a retrospective look, George Ford of the Phoenix Center finds, "no economic payoff from the 15 Mbps speed difference." He's comparing 10 Mbps versus 25 Mbps broadband speeds in 2013-2015 in the U.S. Better broadband is great, but economic claims range from well-paid gibberish to essentially unproven. (My gut is there is an effect, but it's too small to prove. Those "1.3% of GDP" type figures are absolutely unsupportable and embarrassing when quoted.)

Anyone with common sense can see this is on target. Few websites run over a megabit or three. 10 megabits is enough for 2 HD videos, plenty of surfing/homework, and five music channels. Higher speeds are great for pirating music, playing games, watching 3-5 HD TV (or sharp 4K TV,) and folks like Jennie, who does video professionally. But Jennie's business wouldn't suffer greatly if occasionally her uploads run overnight. 

Sometimes, research proves common sense inadequate. But statisticians in evidence-based medicine have learned that unusual findings need to be looked at carefully. Always ask, "Is there a plausible mechanism that explains this finding?" If not, everything needs to be doublechecked and verified.

I do not believe it plausible that watching more HD TV has a significant economic effect.

Currently, we are seeing incredibly egregious claims about 5G, especially in mid-band. It is only 15-50% faster than good 4G LTE. I can't see how raising wireless speeds from, say 200 megabits to 300 megabits, is going to have an important economic effect. 5G NR Only 25% to 50% Faster, Not Truly a New Generation is one of the most important articles I've written, especially because the primary source works for T-Mobile.

George also found, "The results of an earlier and earlier and frequently cited study by Crandall, Lehr, and Litan (2007) are probably spurious." I know them all to be competent, but even MIT scholars can suffer from confirmation bias. My statistics teacher would never have let Crandall's work pass.  

In a separate paper about Sprint-T-Mobile, he writes, "the merger will put upward pressure on wholesale prices even after accounting for merger efficiencies.” It's easy to infer from that that wholesale prices are likely to go up. With costs coming down 40% per year across mobile, at least as measured in price per bit, almost all prices will come down. Sprint-TMO will result in prices higher than they would be otherwise, but they will likely fall in absolute terms. 

If you haven't read John Ioannidis' seminal paper, Why Most Published Research Findings Are False - PLOS, do so before you believe almost any paper in Telecom Policy.

Especially in D.C., far too many are worthless.

Here's the abstract and conclusion of the paper.

Abstract: In this BULLETIN, I aim to quantify the relationship between higher broadband speeds (10 Mbps versus 25 Mbps) and the growth rates in important economic outcomes in U.S. counties including jobs, personal income, and labor earnings. Doing so exposes the potential for severe selection bias in studies of broadband’s economic impact, which is addressed in this study using Coarsened Exact Matching. Once balanced, the data reveal no economic payoff from the 15 Mbps speed difference between the years 2013 and 2015. I also revisit the Crandall, Lehr and Litan (2007) study on broadband’s effect on employment to evaluate the possible impacts of selection bias, and conclude that the positive benefits of broadband reported in that particular study are likely spurious. The selection bias problem may infect other studies on the economic impacts of broadband Internet services.

Conclusion Do counties with mostly 25 Mbps broadband connections fare better economically than counties with mostly 10 Mbps broadband connections? I find no evidence of such an effect here, at least with respect to the growth in jobs, personal income, or labor earnings between 2013 and 2015. This analysis is, of course, limited to those time periods and the outcomes considered, and is dependent on the particular empirical model employed. While these are limitations, the empirical analysis attempts to answer a specific policy question of some importance, and upon doing so, is perhaps the sole evidence available on the presently important topic. What my statistical analysis does find evidence of is profound differences in the economic character of counties with different broadband speeds. Selection bias appears to be a serious problem in quantifying broadband’s economic impact. Broadband (and higher speed broadband) is not randomly distributed across geography, but rather is deployed in areas where the ratio of demand to costs is favorable, complicating the task of discovering broadband’s influence on economic outcomes. Not only does my own analysis of broadband speeds demonstrate these empirical difficulties, but application of standard techniques reveals that the results of an earlier and frequently cited study by Crandall, Lehr, and Litan (2007) are probably spurious. In future research on broadband’s impact on economic outcomes, whether at a macro or micro level, statistical techniques must be used to address both problems of confounding influences and the potentially large differences in the economic and demographic characteristics across geographic markets

 

The world needs a good news source on Internet and telecom policy. I hope to create one. Catch a mistake? Email me please.  Dave Burstein

Latest

Professor Noam's "Many Internets" http://bit.ly/ManyNets

Until about 2010, everyone agreed the Net was a "network of networks," not a monolithic entity. There was a central authority, ICANN, keeping track of domain names, but that was a minor administrative function.
Columbia Professor Noam suggests we might be better off accepting that some nations or groups might want to organize their networks differently. It's easy to see demand for an Internet with much more effective filters against material some think harmful to children. (Any 10 year old can easily find porn today. Many do.)
Internet translation is getting better very quickly. You might want an "Internet" that translates everything into your language. Google Chrome translation isn't perfect but I was able to research most of this story on Russian language sites. With a few more years progress, I might welcome an alternate that brings me everything in English, including caching for better performance.
De facto, Internet news is already split, as hundreds of millions only get their news from Facebook. Google AMP pages, including for news, also favor selected parts of the net
Centralizing the DNS doesn't prevent censorship, as the Chinese have demonstrated. There are many Jewish and Muslim fundamentalists who want to block what they consider blasphemy and limit free speech. See http://www.nytimes.com/2012/05/21/nyregion/ultra-orthodox-jews-hold-rally-on-internet-at-citi-field.html . More from Noam http://bit.ly/ManyNets

Russia Orders Alternate Root Internet System http://bit.ly/RussiaDNS
It's actually practical and not necessarily a problem.The Security Council of the Russian Federation, headed by Vladimir Putin, has ordered the "government to develop an independent internet infrastructure for BRICS nations, which would continue to work in the event of global internet malfunctions ... This system would be used by countries of the BRICS bloc – Brazil, Russia, India, China and South Africa." RT
Columbia University Professor Eli Noam and then ICANN CEO Fadi Chehadé have both said such a system is perfectly practical as long as there is robust interconnection.
Actually, the battle over ICANN and domain names is essentially symbolic. Managing the DNS is a relatively insignificant task, more clerical than governing. ICANN Chair Steve Crocker pointed out they had very little to do with policy.
Some will claim this is about blocking free speech but that's rhetoric. Russia doesn't need to fiddle with the DNS for censorship, as the Chinese have demonstrated. The wonders of the Internet will continue so long as the resulting nets" are robustly connected. The ICANN and U.S. policy goal should be to help create that system for interconnection.
I expect contentions that “The Russians are taking over our Internet” and “They are splitting the Internet.” The Internet is a “Network of Networks.” It is not a monolith so what would “splitting” it mean or do?
After the WCIT, China realized that ICANN and the DNS are side issues not worth bothering about. They have been building alternate institutions including the World Internet Summit in Wuzhan and the BRICs conferences.  The Chinese have put their main work where decisions that matter are made. Wireless standards are set by 3GPP, where nothing can be approved without China's consent.
The American battle at ITU is proving to be a historic mistake.
Why does Russia want an independent Internet?
They fear that Western sanctions on Russia could cripple the Russian Net. Communications minister, Nikolay Nikiforov, worries about, "a scenario where our esteemed partners would suddenly decide to disconnect us from the internet." I think that's highly unlikely but Nikiforov points out, “Recently, Russia is being addressed in a language of unilateral sanctions: first, our credit cards are being cut off; then the European Parliament says that they’ll disconnect us from SWIFT."
It makes sense for the Russians to be prepared for such a contingency as the Cold War has been warming up on both sides. "Britain's top military chief Air Chief Marshal Sir Stuart Peach just made headlines warning Russian subs "could CRIPPLE Britain by cutting undefended undersea internet cables." Much more http://bit.ly/RussiaDNS

ICANN Continues Excluding Russia & China From the Board http://bit.ly/CEOPromises
No wonder Russia wants an alternate root. Three years ago, ICANN CEO Fadi Chehadé promised "a seat at the table" to Chinese Premier Li. ICANN welched and this year added two more Americans.
Almost all the ICANN board is from the U.S. and close allies; only about 4 of the 18 board members are from countries on the other side of the North/South divide in Internet policy.  Claiming ICANN represents the Global Internet is inappropriate. China is 1/3rd of the Internet but has no representation on the board.
I know many of the board members. They are all basically honorable but generally share a strong opinion on North-South issues.
Larry Strickling of the U.S. government knew just what he was doing with the IANA transition. He handed over to a board with similar positions as the U.S. government.
"The system is unsustainable while it excludes half the world," I have been saying since 2012. More, including the transcript of Fadi's statements,http://bit.ly/CEOPromises

Sorry, Ajit Pai: Smaller Telcos Did Not Reduce Investment After NN Ruling http://bit.ly/SorryPai
Pai justifies his NN choice with the claim, "The impact has been particularly serious for smaller Internet service providers." #wrong (Actually, NN has minimal effects on investment, up or down, I’m convinced. Competition, new technology, customer demand and similar are far more important.)
The two largest suppliers to “smaller ISPs” saw sales go up. Adtran's sales the most recent nine months were $540M, up from $473M the year before. 2016 was $636M, 2015 $600M. Calix the last nine months sold $372M, up from $327M. The full year 2016 was $459M, up from $407M in 2015. Clearfield, a supplier of fiber optic gear, was up 8% in sales in the smaller ISPs.
There is nothing in the data from others that suggests an alternate trend. Anyone could have found this data in a few minutes from the company quarterly reports.
The results in larger companies are ambiguous. I can "prove" capex went up or went down by selecting the right data. The four largest companies' capex - two/thirds of the total - went up from $52.7B in 2015 to $55.7B in 2016. The result remains positive after making sensible adjustments for mergers and acquisitions. That's as close to "proving" that NN led to increased spending as the facts chosen to prove the opposite.
Actually, whether capex went up or down in 2016 tells us almost nothing about the choice on neutrality. Everyone knows a single datapoint could be random or due to other causes. Much more, including the source of the errors http://bit.ly/SorryPai

Elders Bearing Witness: Vint, Timbl, & Many More http://bit.ly/VintTim
Vint Cerf, Tim Berners-Lee, Steve Wozniak and more than a dozen true Internet pioneers wrote Congress to protect Neutrality. The best Congress money can buy didn't listen but I wanted to reproduce their letter.
I hope they are wrong believing "is an imminent threat to the Internet we worked so hard to create." My take is the impact will be moderate in the short run.
From the letter:
We are the pioneers and technologists who created and now operate the Internet, and some of the innovators and business people who, like many others, depend on it for our livelihood. ... The FCC’s proposed Order is based on a flawed and factually inaccurate understanding of Internet technology. These flaws and inaccuracies were documented in detail in a 43-page-long joint comment signed by over 200 of the most prominent Internet pioneers and engineers and submitted to the FCC on July 17, 2017.
Despite this comment, the FCC did not correct its misunderstandings, but instead premised the proposed Order on the very technical flaws the comment explained. The technically-incorrect proposed Order ... More, including the full list, http://bit.ly/VintTim