Did AT&T Die in Vain? An Empirical Comparison of AT&T and Bell Canada

The Enduring Lessons of the Breakup of AT&T: A Twenty-Five Year Retrospective. \u27 Conference held at the University of Pennsylvania Law School on April 18-19, 2008. Did the Divestiture of AT&T achieve its purpose? It is helpful to turn to Canada, whose telecommunications industry and regulation were similar but which did not experience a divestiture. Since AT&T was split up in 1982-4, national telecom market concentration in the U.S. has bounced back to a national duopoly structure, with an HHI concentration index of 2,986, higher than for Canada\u27s similar national duopoly with an HHI of 2,463. Local telecom wireline competition is greater in Canada, as are broadband and wireless penetrations. Real revenue for all of AT&T\u27s successor companies grew only half as much as in Canada. AT&T successors\u27 combined market capitalization rose only one third as much as did Bell Canada. U.S. telecom prices are more favorable to business, low-use consumers, and mobile users, but less favorable to high-use consumers, especially those making long distance calls. AT&T\u27s research development sector was decimated while Canada has preserved some reduced in-house research. Employment in the U.S. declined slightly after 1997, whereas in Canada it rose over 20%. Taken together, this comparison does not indicate that the AT&T divestiture created advantages relative to Canada

Federal and State Roles in Telecommunications: the Effects of Deregulation

During the past decade, federal telecommunications regulatory policy has changed its focus from a goal of universally available and affordable residential service to one of economic efficiency. In changing its regulatory focus, the federal government has indirectly deprived the states of the means to accomplish their goal, which remains one of insuring universally available and affordable residential service. In his Article Professor Noam examines the evolution of the traditional federal-state coregulatory system, contrasts the emerging federal regulatory approach with the states\u27 policies, and discusses the reasons for federal predominance in telecommunications regulation.He argues that the reorientation in federal regulatory policy is creating administrative problems for state regulators and will impair their ability to attain universally available and affordable residential service. Professor Noam predicts that if the states abandon their policy goals in favor of the federal goals, they actually will weaken federally inspired entry into the telecommunications industry and thus hamper the federal government\u27s ability to realize its goal. He concludes that the current coregulatory system is probably not stable and that a new intergovernmental consensus is necessary to replace the present federal dominance