ABSTRACT
This chapter examines the current conditions in the U.S. telecommunications sector (i.e., October 2002). It examines the impact of technological and regulatory change on market structure and business strategy. Among others, it discusses the emergence and decline of the telecom bubble, the impact of digitization on pricing, and the emergence of Internet telephony. The chapter briefly examines the impact of the 1996 Telecommunications Act on market structure and strategy in conjunction with the history of regulation and antitrust intervention in the telecommunications sector. After discussing the impact of wireless and cable technologies, the chapter concludes by venturing into some short-term predictions. There is concern about the derailment of the implementation of the 1996 Act by the aggressive legal tactics of the entrenched monopolists (the local exchange carriers), and we point to the real danger that the intent of the U.S. Congress in passing the 1996 Act to promote competition in telecommunications will not be realized. The chapter also discusses the wave of mergers in the telecommunications and cable industries.
