One of the talking points repeated over and over and over by carriers who oppose network neutrality is that network neutrality rules will "stifle investment" in the sector. Verizon CEO Ivan Seidenberg said as much yesterday, and AT&T urged their employees (via private e-mail accounts) to bombard the FCC with the talking point earlier this week. Lobbyists and paid mouthpieces also repeat the threat at every opportunity. But is it true? Not even remotely, according to a new report by consumer advocacy firm Free Press:For one, it needs to be understood that with the volume of lobbying that will wind up shaping the FCC's new rules, it's highly unlikely that the guidelines will do anything other than prevent the most egregious of anti-competitive offenses (like an ISP blocking a service because it competes with one of its own). The idea that a heavily-lobbied Uncle Sam is going to pass real, tough pro-consumer laws at this juncture is somewhat of a joke in and of itself -- much less the idea that these basic rules would impact the largely unrelated need to invest in capacity.

Secondly, if you've studied the telecom industry lobbying play book at all, you know that threatening to halt investment is the oldest trick in the book. Carriers have always threatened to halt investment unless they get whatever it is they want (lower taxes, elimination of consumer protections, subsidies, less regulation for them, more regulation for a competitor, a new pony). It almost always works, thanks to spineless regulators who are driven either by fear their state is going to be left in the digital dust, or by campaign contributions.

For example in Massachusetts, Verizon first threatened to halt FiOS investment unless they got favorable TV regulation. After getting what they wanted -- Verizon again threatened to halt investment because they didn't want to pay property taxes. Even when Verizon wasn't having to pay property taxes they left huge rural swaths of Massachusetts unwired -- and it had to do with a low rural ROI and limited competition, given they already had favorable regulation. Withholding network investment to gain political favor is bullying, and the threats are empty.

But Free Press plays along, giving readers a business 101 primer on the kind of things that actually do impact network investment: competition (which carriers often don't face), supply costs (which continue to drop), and demand or expectation of demand (which obviously continue to rise). As the Free Press notes, when asked, no ISP has actually been able to supply a concrete example of how the new FCC neutrality rules would lower ROI, but that apparently doesn't stop these companies and their mouthpieces from re-using the argument repeatedly.

The idea that a few watered down FCC neutrality rules would halt absolutely necessary investment is bogus, yet that apparently doesn't stop it from being repeated not only by ISPs, but by a gullible press, well-lobbied politicians, and investors. It shows you the effectiveness of having your lobbyists repeat the same false arguments for half a decade, regardless of how many times those arguments are proven incorrect.