1Alfred E. Kahn, "Deregulation and Vested Interests: The Case of Airlines," in Roger G. Noll and Bruce M. Owen, editors, The Political Economy of Deregulation (Washington, D. C.: The American Enterprise Institute, 1983), p. 140.
2David B. Kopel, Access to the Internet: Regulation or Markets?, Policy Study No. 92, The Heartland Institute, September 24, 1999, p. 3 (hereinafter referred to as Heartland Policy Study).
3Broadband Today, A Staff Report to William E. Kennard, Chairman, FCC, On Industry Monitoring Sessions convened by Cable Services Bureau, October 1999, p. 9.
4"Cable Modem Market Stats & Projections," Cable Datacom News, accessible via Internet at http://www.cabledatacomnews/cmic/cmic16.html.
5These data are estimated from the "Breakdown of Online Universe" chart in the FCC Broadband Today report.
6See NetAction, "Broadband Cable: The Open-Access Debate," accessible via Internet at http://www.netaction.org/broadband/cable/current.html.
7See Broadband Today for some background on the OpenNet coaltion's position.
8See Broadband Today, pp. 14-15, for more details.
9Senate Bill No. 667, June 17, 1999.
10A portal is the first page the user sees when a connection is made. This page typically offers users many features like email, news, information organized by specific categories, and so forth.
12This distinction, which is based on access speed, is arbitrary and likely to change as current technologies improve and new and faster technologies emerge in the marketplace.
13Federal Communications Commission, Trends In Telephone Service, September 1999, "Household Telephone Subscribership in the United States," 17-3 (hereinafter referred to as Trends In Telephone Service report).
14Heartland Policy Study, p. 22. A brief survey of prices charged in several Michigan cities reveals that the price for broadband access is generally around $39.95. See Cable Datacom News at http://www.cabledatacomnews.com.
15See Broadband Today, p. 19.
16Heartland Policy Study, p. 22.
17The bandwidth capacity is also shared with the transmission of video programming.
18Nonetheless, cable firms are likely to address these problems as this technology becomes used more widely to provide access.
19Heartland Policy Study, p. 45.
20For example, AT&T/TCI's affiliate ISP is @Home and Time Warner's affiliate is RoadRunner.
21Cable firms are currently developing a new type of modem that can be easily installed by consumers. For more details, see Broadband Today.
22See Broadband Today for more detail.
23See "In a Race to the Web, Phone Upstarts Grab Turf," Wall Street Journal, October 18, 1999, p. B1.
24See United States Internet Council, "The Explosion of High-Speed Internet Competition," for some examples.
25Heartland Policy Study, p. 44.
26Economists refer to this phenomenon as "opportunistic behavior."
27Benjamin Klein, Robert A. Crawford, and Armen A. Alchian, "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, 21 (October 1978): pp. 297-326.
28Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996).
29Report to the Michigan Governor and Legislature on Public Act 1991 as Amended Section 353, Report on Local Telephone Interconnection, February 1998.
30See Trends in Telephone Service, 9-1, for more details.
31For an example of how firms can voluntarily cooperate in a market setting similar to the Internet access market, see Paul A. Cunningham and Robert M. Jenkins III, "Railing at 'Open Access,' " Regulation, Spring 1997.
32In this context, rent-seeking behavior refers to activities that reduce society's welfare, but improve the chances of the ISPs competing in the marketplace with assistance from the government.
33This quote by the NTIA is taken from Thomas W. Hazlett and Matthew L. Spitzer, Public Policy Toward Cable Television: The Economics of Rate Controls (The MIT Press: Cambridge, MA, 1997), p. 39.
34See Donald L. Alexander, "Laying Cable and Competition," Michigan Privatization Report, Summer 1999, Mackinac Center for Public Policy.