TWO YEARS AFTER THE ACT
The Telecom Act has spurred new competition throughout the marketplace.
Local Telephone Competition
- Competitive telephone companies (CLECs) tripled their customer lines in 1997 to about
1.5 million at the end of the year.
- CLECs now account for about 2.6% of all local telephone revenues.
- Top ten CLECs have switches in 132 cities in 33 states, nearly all of which have been
installed since the Act was passed.
Long Distance Competition
- Since 1995, smaller long distance companies have increased their share of the market from
under 17% to 24%.
Cable Television Competition
- Direct Broadcast Satellite systems have more than doubled their customers in less than two
years from 2.2 million to 5 million.
- Several local telephone companies are overbuilding cable systems.
- The market share of incumbent cable operators has fallen four percent in the last 18 months
- As a result of spectrum auctions held by the Commission, half of all Americans have a
choice of at least four wireless providers in their communities.
Consumers are benefiting from increased competition by receiving lower prices and better
- Since the Act was passed, retail prices for interstate long distance calls have fallen 5.3%.
- Rates for calls from the US to foreign countries have fallen from 84 cents/minute in 1995
to under 70 cents/minute in 1997.
- Cable overbuilds have prevented incumbents from raising their prices as compared to rates
in communities with only a monopoly cable supplier.
- In 1997, average cellular prices dropped 25% in markets where PCS firms began service.
Competition will continue to accelerate under the Telecom Act.
- Publicly traded CLECs have raised $14 billion in capital since the Act was passed and their
total market capitalization now amount to $20 billion.
- Through licensing actions by the Commission, digital television and digital satellite radio
are being developed.
The Commission has taken firm steps to bring the benefits of the Act to all Americans.
- Universal service reform will keep rates affordable for all Americans.
- Schools, libraries, rural health care providers and Americans with disabilities will all benefit
from Commission actions to bring them modern telecommunications facilities and services.