Review of Industrial Organization 16: 219–223, 2000.
© 2000 Kluwer Academic Publishers. Printed in the Netherlands.
Discussant Comments on Papers by Andrew
Joskow, Daniel Rubinfeld, and Janusz Ordover and
U.S. Department of Justice, Antitrust Division, Washington DC 20530, U.S.A.
Rather than attempting to discuss all three papers in detail, let me concentrate on a
few main themes. I will devote most of the discussion to Andrew Joskow’s paper,
which addresses competition in telecommunications since the 1996 Telecommuni-
cations Act – an issue of considerable interest to me given my prior and ongoing
work in this area.
The paper covers two main topics: entry into long-distance (interLATA) services by
the Regional Bell Operating Companies (RBOCs) under Section 271 of the Tele-
com Act; and mergers between large incumbent local phone companies (ILECs,
such as the RBOCs or GTE) that operate in non-overlapping local territories. I
agree substantially with the paper’s analysis and only wish to expand on a few
RBOC Entry into Long Distance. The DOJ’s standard for recommending FCC ap-
proval of an RBOC’s long-distance application in a state requires that the RBOC’s
local market in that state must ﬁrst be fully and irreversibly open to competition.
Economics Director of Enforcement, Antitrust Division, U.S. Department of Justice, and Pro-
fessor of Economics, Georgetown University (on leave). These discussant comments do not purport
to reﬂect the views of the Department of Justice.
Among other things, this entails showing that the new arrangements needed for local
competition (such as operations support systems through which competitors can interface elec-
tronically with the incumbent) are in place, and that a track record of their performance has
been established so as to prevent backsliding by an RBOC once it receives long-distance au-
thority. See Evaluation of the United States Department of Justice (DOJ), In the Matter of
Application of SBC Communications Inc. et al. Pursuant to Section 271 of the Telecommu-
nications Act of 1996 to Provide In-Region, InterLATA Services in the State of Oklahoma,
FCC, CC Docket 97-121, May 16, 1997 (www.usdoj.gov/atr/public/comments/sec271/sbc/sbc.htm).