Universal Service: When Technologies Converge and Regulatory Models Diverge
Posted: 22 Feb 2001
This article examines several instances where Congress and the Federal Communications Commission have created opportunities for stakeholders to exploit differences in regulatory treatment. Such asymmetry in regulatory requirements have destabilized or reduced the potential for full and fair competition, because they tilt the competitive playing field in favor of one class of stakeholder.
The article examines a number of semantically driven regulatory dichotomies, e.g., common carrier versus private carrier, basic versus enhanced services and incumbent local exchange carrier versus market entrant with an eye toward determining whether technological convergence and regulatory opportunism defeats the possibility of establishing a dual track regulatory regime. Additionally the article scrutinizes several marketplace anomalies resulting when a regulatory dichotomy triggers a diversion or inflow of funds based on an operator's regulatory classification and its adeptness at exploiting arbitrage opportunities. The article concludes with suggestions on how legislators and regulators might curb regulatory opportunism by abandoning the strategy of classifying carriers based on static technological or economic definitions.
JEL Classification: K23, L51, L86, L98
Suggested Citation: Suggested Citation