Remembering What the Fight is About

Abstract

This essay argues that the core purpose of the Telecommunications Act of 1996 was never fundamentally about the deregulation of incumbents or to encourage incumbent investments per se (although certainly an intended eventual consequence) but, as the Supreme Court observed, to "reorganize markets by rendering regulated utilities' monopolies vulnerable to interlopers." As such, the author argues that if new capital is ever going to start to reflow to the telecoms CLEC industry, then it is high time for policymakers to return to first priciples and to refocus the debate back onto the still unresolved goal of the 1996 Act: how do we make entry economically attractive so as to allow us to "reorganize" the market so that we can move from by "one" (monopoly) to a market characterized by "many" (competition)?

Keywords: Telecommunications, Competition, Unbundling, Entry, 1996 Act

JEL Classification: K23, L10, L11, L12, L13, L16, L5, L96, 033