Telephone Companies in Paradise
A Case Study in Telecommunications Deregulation
Computerization has generated dramatic advances In telecommunications, such as mobile telephones and video conferencing. Coupled with this are major changes in regulation, as telephone companies face new competitors. States are experimenting with new forms of utility regulation and deregulation in order to cope with the demands of rising competition. Here Mueller examines in detail the results of a radical telephone regulation law.In 1986, the state of Nebraska completely discarded traditional utility regulation, deregulating rates and profits of its local telephone companies. The Nebraska experiment has become a benchmark for reassessing the role of state regulation In the future of telecommunications. Using comparative data from five midwestern states, Mueller shows how deregulation affected rates, investment, infrastructure modernization, and profits. He uncovers both positive and negative results. Mueller found established telephone companies to be basically conservative, not aggressive and expansionist, and concludes that new competition, not regulation or deregulation, is transforming the telecommunications industry.This book is the first systematic empirical study of the controversial Nebraska law and its broader effects. It will be a significant addition to the much debated issue of telecommunications deregulation. Economists, policymakers, and telecommunications managers will find in this volume a substantial resource. According to Robert Atkinson, senior vice president of Teleport Communications Group: "Nebraska's experiences with telecommunications deregulation - the good, the bad and the ugly - need to be understood by all telecommunications policymakers across the country so that they can emulate Nebraska's successes and avoid its mistakes. Mueller provides the roadmap."