An econometric analysis of the factors affecting the deployment of advanced telecommunications services

This study examines the decisions of all incumbent local exchange companies (ILECs) in the United States to deploy advanced telecommunications services within each of their wire center serving areas. The advanced telecommunications services examined are packet switching, digital signal level (DS) transport, and synchronous optical network (SONET) technologies. The study is unique in its level of granularity and the set of economic determinants controlled for in the econometric analysis.;Supplier, buyer, market and regulatory data has been collected at the wire center level that uniquely defines ILEC as well as its market including type of holding company, number of firms, number of competitors, and forms of regulation.;The implications from this study will provide policy insights on those economic determinants most conducive to the adoption of technological innovation and thus will provide answers to questions engendered by the implementation of the Telecommunications Act of 1996: Does competition and/or deregulation inhibit technological innovation? For economists, this study will go a long way in addressing the applicability of the Schumpeterian hypotheses---at least within the competition, most forms of alternative regulation may not be as effective as RBROR in introducing new technological services.