The Telecommunications Act of 1996

Paper Summary:

This paper examines the impact of the Telecommunications Act of 1996 in terms of the industry standards that it broke and reset. The paper focuses on AT&T in order to show how a large company can receive benefits by breaking into smaller markets under the Act. The paper explores the various implementations of the Act in terms of mandated standards of operation, focusing upon generalized advantages, as well as disadvantages in the theoretical and real-world dynamics of the Act.

From the Paper:

"The increase in technological sophistication available to the customer through dynamic competition, and the increase in customer service, are stated goals of the Telecommunications Act of 1996. Economically, the individual customer as well as group clients can also expect competition to continue to drive down prices. On a grand scale, the act is about showing people that regulated monopolies are not superior to the basic forces of supply, demand, and competition. And in many ways the act has succeeded in putting this message forth loud and clear. New players can enter the marketplace locally, prices have dropped substantially, and investment in new technology and equipment have increased. In many ways, the act is presented "as radical deregulation under which the country will move toward a brave new world of telemedicine, distance learning, and movies-on-demand. According to the hype, such wonders will be created by the competitive forces that have been set free by the new act" (Gasman). There are also disadvantages to the system, however, due to the fact that local carriers are not always eager to open their markets in a deregulated atmosphere."

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