Page 173 - Communication Commerce and Power The Political Economy of America and the Direct Broadcast Satellite

Capital, Technology and the US in an 'Open Market' 163

rates it charged in local monopolies. In sum, new open-market
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opportunities granted to one sub-sector generated demands for similar
opportunities by others.
More than twenty years after the Department of Justice antitrust
suit against AT&T, Congress passed what arguably is the most sweep-
ing piece of market liberalization legislation in US history - the
Telecommunications Act of 1996. Similar to the divestiture, the Tele-
communications Act is designed to further the interests of mostly
large companies, some seeking opportunities to seize market share
from rival communications and information interests, others also
aspiring to consolidate existing market positions. Long-distance tele-
phone interests- AT&T, MCI and Sprint- sought and obtained more
opportunities to become full service communications and information
corporations. This was achieved, for instance, through their direct
access into local markets involving the Act's legalization of competit-
ive cable television and other services. Similarly, the regional tele-
phone companies (th~ RBOCs) were granted the right to provide
customers with long-distance and other services, including television
(or 'video'). Cable television companies also have been given permis-
sion to offer telephone and other services. From a legal perspective,
the Telecommunications Act thus signals the start of a period of
intensified corporate jockeying, deal-making and, in some instances,
direct competition.
This is not to say that the Act is a precursor to the development of
some sort of seamless and competitive national and perhaps interna-
tional communications and information infrastructure. Long-distance
telephone companies now appear well positioned to forge seamless but
largely non-competing full-service infrastructures. RBOCs, on the
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other hand, while free to provide long-distance services, now face
direct competition locally and more legal restrictions relative to
long-distance companies in servicing regional markets. As for the
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cable television companies, their well-known debt-loads, when viewed
in relation to the costs of upgrading infrastructures, will probably
compel them to consolidate their positions through mergers, acquisi-
tions and creative partnerships. 8
Out of the complexity of the 1996 Telecommunications Act, and the
political-economic ramifications of its implementation, come new
opportunities and insecurities. For most of the large-scale corporations
directly involved in communications and information commodity activ-
ities, more competition is not an end in itself, but it is the means through
which new markets potentially can be dominated. In addition to these