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Net Neutrality - Global Thematic Research

Net Neutrality - Global Thematic Research

Summary

America is set to change the balance of power between Internet companies like Netflix and Internet service providers (ISPs) like AT&T. On 14 December 2017, the FCC will vote on whether to eliminate net neutrality, the regulatory principle that ISPs should treat all Internet traffic equally. Supporters of net neutrality argue that an “open Internet” is essential in order to encourage innovation and free speech. Opponents of net neutrality argue that it discourages ISPs from investing in the high-speed broadband networks that the West badly needs if it is to stay ahead in the global “data revolution”.

The evidence points clearly to net neutrality rules being scrapped on 14 December 2017, because -

  • President Trump and the Republican Party are both against regulatory over-reach;
  • FCC Chairman, Ajit Pai, a former Verizon lawyer, is vehemently against net neutrality; and
  • The US is falling down the world league table of broadband speeds, so it needs to incentivise its ISPs to invest in high speed broadband infrastructure by allowing them to charge all economic parties that benefit from using their pipes at commercial rates.
  • In this report we look into industry overview, trends, value chain of net neutrality, also identifying winners and losers.

    Scope
    • This report is part of our ecosystem of thematic investment research reports, supported by our “thematic engine”.
    • About our Thematic Research Ecosystem
    • GlobalData has developed a unique thematic methodology for valuing technology, media and telecom companies based on their relative strength in the big investment themes that are impacting their industry. Whilst most investment research is underpinned by backwards looking company valuation models, GlobalData’s thematic methodology identifies which companies are best placed to succeed in a future filled with multiple disruptive threats. To do this, GlobalData tracks the performance of the top 600 technology, media and telecom stocks against the 50 most important themes driving their earnings, generating 30,000 thematic scores. The algorithms in GlobalData’s “thematic engine” help to clearly identify the winners and losers within the TMT sector. Our 600 TMT stocks are categorised into 18 sectors. Each sector scorecard has a thematic screen, a risk screen and a valuation screen. Our thematic research ecosystem has a three-tiered reporting structure: single theme, multi-theme and sector scorecard. This report is a Single Theme report, offering in-depth research into a specific theme. It identifies winners and losers based on technology leadership, market position and other factors.
    Reasons to buy
    • Our thematic investment research product, supported by our thematic engine, is aimed at senior (C-Suite) executives in the corporate world as well as institutional investors.
    • Corporations: Helps CEOs in all industries understand the disruptive threats to their competitive landscape
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    • Our unique differentiator, compared to all our rival thematic research houses, is that our thematic engine has a proven track record of predicting winners and losers.


    PLAYERS
    TRENDS
    VALUE CHAIN
    INDUSTRY ANALYSIS
    The backdrop to the net neutrality story
    Net neutrality was set up for good reasons
    Regulatory policies always have unintended side effects
    Both sides of the net neutrality debate have strong arguments
    It now looks like net neutrality may fall in the US under President Trump
    Implications if net neutrality falls
    US telecom operators and cable operators may benefit
    Large US Internet companies who use substantial bandwidth may lose
    Global telecom equipment makers could benefit
    European and Asian telecom operators may see some benefit in the medium term
    If implemented sensibly, a world without net neutrality may not be so bad
    TELECOM AND CABLE OPERATORS - SECTOR SCORECARD
    Thematic screen
    Valuation screen
    Risk Screen
    TELECOM EQUIPMENT - SECTOR SCORECARD
    Thematic screen
    Valuation screen
    Risk Screen
    APPENDIX: OUR “THEMATIC” RESEARCH METHODOLOGY

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