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Why Adco? Why Now? An Econmic Exploration Of Industry Structure For The "Last Mile" In Local Telecommunications Markets, T. Randolph Beard, George S. Ford, Lawrence J. Spiwak

Federal Communications Law Journal

This Article discusses important economic characteristics of local exchange markets. First, this Article explains that entry into the market requires large fixed and sunk costs, making entry risky and necessitating scale economies. Consequently, only a few local access networks can supply the market. These networks cannot be small, however, because a large market share is required to realize sufficient scale economies to effectively compete with the ILEC and survive. Secondly, acquiring the needed market share may be difficult for entrants who either attempt to purchase unbundled network elements from the incumbent or attempt to build their own network from the …