This paper analyzes whether repealing net neutrality (NN) improves ordecreases the capacity of a regulator to make internet service providers(ISPs) extend broadband coverage through universal service obligations(USOs). We model a two-sided market where a monopolistic ISP links contentproviders (CPs) to end users with a broadband network of a given bandwidth.A regulator determines whether to submit the ISP to NN or to allow it tosupply paid priority (P) services to CPs. She can also impose a broadbandUSO to the ISP, i.e. she can mandate the broadband market coverage. We show that the greater is the network bandwidth, the more likely the repeal of netneutrality increases ISP profits and social welfare. Regulation can still benecessary, however, as there are bandwidth ranges for which the ISP wouldbenefit from a repeal of NN while such a repeal is detrimental to society.
JEL: D21, K23, L12, L51, L96