Economic Model for Monopoly Analysis in Telecommunication: Proposal to Demonstrate Uniqueness

The Telecommunications Act of 1996 sought to end the monopoly that once existed in the telecommunications industry. Since its adoption, the telecommunications industry has been undergoing a period of rapid change and development. The entry of new players into the market encouraged them to seek new ways to attract and keep customers. These changes have led to a rapid influx of new technology and services. Many times what defines a monopoly is not clear in every circumstance and there are many pending lawsuits for violations of antitrust laws in the courts today. Economic models are useful in resolving issues of whether a monopoly truly exists, or whether claims are unsubstantiated. Previous models were applicable only in certain situations. These models are unreliable in predicting monopolies outside the parameters for which they were designed. This research will develop and test an economic model that accurately predicts the existence of a monopoly in the telecommunications sector, based on the United States of America’s marketplace case, as the best representative example to deal with.