TWO YEARS HAVE ELAPSED SINCE CONGRESS PASSED THE Telecommunications Act of 1996 to "provide a pro-competitive, de-regulatory national policy framework designed to accelerate rapidly private sector deployment of advanced telecommunications and information technologies and services to all Americans." %n1%n
Today, however, telephone deregulation has reached an impasse. Few customers enjoy competitive alternatives for local exchange service. Concentration in long-distance markets appears to be increasing.
At its core, the Act still offers its quid pro quo - the Regional Bell Operating Companies would gain interLATA authority (for long-distance service) by allowing entry into their local markets. Nevertheless, that trade has not proven attractive enough to force open the local exchange. The two sets of players, the RBOCs and the interexchange carriers, have fallen into a war of words. Each side (and its paid experts) blames the other for the stalemate that has arisen.
So far, the RBOCs could count themselves fortunate to have found a sympathetic ear at the Eighth Circuit Court in St. Louis in their appeal of the Federal Communications Commission's local exchange market rules, which would have placed competition on a fast track. %n2%n However, the U.S. Supreme Court may not prove so obliging. Recently, it agreed to hear the appeal filed by the FCC and the IXCs challenging the eighth circuit's ruling. %n3%n The FCC's local competition rules may yet rise from the ashes.
The Supreme Court has scheduled arguments for fall 1998, but that may not be soon enough for some. In any case, the potential reincarnation of telephone competition cannot occur at least until sometime in 1999. Given the gridlock, observers have suggested another way out: Divest the RBOCs of their network assets.