UNITED STATES TELECOM ASSOCIATION, et al., Petitioners,
v.
FEDERAL COMMUNICATIONS COMMISSION аnd United States of America, Respondents.
Bell Atlantic Telephone Companies, et al., Intervenors.
United States Telecom Association, et al., Petitioners,
v.
Federal Communications Commission and United States of America, Respondents.
AT&T Corporation, et al., Intervenors.
No. 00-1012.
No. 00-1015.
No. 00-1025.
No. 01-1075.
No. 01-1102.
No. 01-1103.
United States Court of Appeals, District of Columbia Circuit.
Argued March 7, 2002.
Decided May 24, 2002.
On Petitions for Review of Orders of the Federal Communications Commission.
Michael K. Kellogg argued the cause for petitioners and supporting intervenors in 00-1012 & 00-1015. With him on the briefs in 00-1012 were Mark L. Evans, Sean A. Lev, James D. Ellis, Paul K. Mancini, Roger K. Toppins, Gary L. Phillips, Lawrence E. Sarjeant, Linda L. Kent, Keith Townsend, John W. Hunter, Julie E. Rones, William P. Barr, Michael E. Glover, Edward H. Shakin, John P. Frantz, Richard M. Sbaratta, and James G. Harralson. With him on the briefs in 00-1015 were Mark L. Evans, Sean A. Lev, David L. Schwarz, Lawrence E. Sarjeant, Linda L. Kent, Keith Townsend, John W. Hunter, Julie E. Rones, Sharon J. Devine, Robert B. McKenna, William T. Lake, John H. Harwood II, Jonathan J. Frankel, James D. Ellis, Paul K. Mancini, Roger K. Toppins, Gary L. Phillips, Michael E. Glover, Edward H. Shakin, William P. Barr, John P. Frantz, Jonathan B. Banks, Richard M. Sbaratta, and James G. Harralson. Donna M. Epps entered an appearance in 00-1012. Daniel L. Poole and William R. Richardson, Jr. entered appearances in 00-1015.
Laurence N. Bourne, Counsel, Federal Communications Commission, argued the cause for respondents in 00-1012. With him on the brief in 00-1012 were Charles A. James, Assistant Attorney General, Daniel M. Armstrong, Associate General Counsel, John E. Ingle, Deputy Associate General Counsel, James M. Carr, Counsel, Catherine G. O'Sullivan and Nancy C. Garrison, Attorneys, U.S. Department of Justice. Lisa S. Gelb, Counsel, Federal Communications Commission entered an appearance in 00-1012.
Richard K. Welch, Counsel, Federal Communications Commission, argued the cause for respondents in 00-1015. With him on the briefs in 00-1015 were Charles A. James, Assistant Attorney General, Daniel M. Armstrong, Associate General Counsel, John E. Ingle, Deputy Associate General Counsel, Laurence N. Bourne and James M. Carr, Counsel, Cathеrine G. O'Sullivan and Nancy C. Garrison, Attorneys, U.S. Department of Justice. Lisa S. Gelb, Counsel, Federal Communications Commission, entered an appearance in 00-1015.
Jonathan Jacob Nadler argued the cause for intervenors AT&T Corp., et al. in 00-1012. With him on the brief in 00-1012 were David W. Carpenter, Peter D. Keisler, James P. Young, Mark C. Rosenblum, Lawrence J. Lafaro, Richard H. Rubin, Donald B. Verrilli, Jr., Maureen F. Del Duca, Michael B. DeSanctis, Thomas F. O'Neil III, William Single, IV, Theresa K. Gaugler, Charles C. Hunter, Catherine M. Hannan, Albert H. Kramer, Robert McDowell, Jay C. Keithley and H. Richard Juhnke. John J. Heitmann, Jonathan E. Canis and Roy E. Hoffinger entered appearances in 00-1012.
David W. Carpenter argued the cause for intervenors AT&T, Corp., et al. in 00-1015. With him on the brief in 00-1015 were Peter D. Keisler, James P. Young, C. Frederick Beckner III, Mark C. Rosenblum, Lawrence J. Lafaro, Richard H. Rubin, Donald B. Verrilli, Jr., Maureen F. Del Duca, Michael B. DeSanctis, Thomas F. O'Neil III, William Single, IV, Rodney Joyce, Christy C. Kunin, Russell I. Zuckerman, Francis D.R. Coleman, Richard E. Heatter, Marilyn H. Ash, Douglas G. Bonner, Albert H. Kramer, Charles C. Hunter and Catherine M. Hannan. Rоy E. Hoffinger, Lawrence G. Acker, John J. Heitmann and Jonathan E. Canis entered appearances.
Before: EDWARDS and RANDOLPH, Circuit Judges, and WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge WILLIAMS.
WILLIAMS, Senior Circuit Judge:
Petitioners in these two cases — certain incumbent local exchange carriers ("ILECs") and the U.S. Telecom Association, representing approximately 1200 such carriers — seek review of two rulemaking orders of the Federal Communications Commission. One order requires ILECs to lease a variety of "unbundled network elements" ("UNEs") to competitive local exchange carriers ("CLECs"), and the other unbundles a portion of the spectrum of local copper loops so that CLECs can offer competitive Digital Subscriber Line ("DSL") internet access. We grant both petitions, and remand both rules to the Commission.
I. Background
Congress passed the Telecommunications Act of 1996, Pub.L. 104-104, 110 Stat. 56, codified at 47 U.S.C. § 151 et seq. (the "1996 Act" or the "Act"), to "promote competition and reduce regulation in order to secure lower prices and higher quality services for American telecommunications consumers and encourage the rapid deployment of new telecommunications technologies." 1996 Act, preamble. In pursuit of that goal, § 251 of the Act requires that ILECs "unbundle" their network elements — that is, provide them on an individual basis to competitive providers on terms prescribed by the Commission. 47 U.S.C. § 251(c)(3). To guide the Commission in deciding which network elements are to be unbundled, the Act goes on to specify:
(2) Access standards
In determining what network elements should be made available for purposes of subsection (c)(3) of this section, the Commission shall consider, at a minimum, whether —
(A) access to such network elements as are proprietary in nature is necessary; and
(B) the failure to provide access to such network elements would impair the ability of the telecommunications carrier seeking access to provide the services that it seeks to offer.
47 U.S.C. § 251(d)(2) (emphasis added).
In its first effort at implementation, Implementation of the Local Competition Provisions in the Telecommunications Act of 1996, First Report and Order, CC Docket No. 96-98,
The term "impair" means "to make or cause to become worse; diminish in value." We believe, generally, that an entrant's ability to offer a telecommunications service is "diminished in value" if the quality of the service the entrant can offer, absent access to the requested element, declines and/or the cost of providing the service rises. We believe we must consider this standard by evaluating whether a carrier could offer a service using other unbundled elements within an incumbent LEC's network.
Id. at 15643, ¶ 285 (emphasis added). In AT&T Corp. v. Iowa Utilities Board,
In Iowa Utilities Board, the Supreme Court also addressed the Act's provisions on rates for UNEs, reversing the Eighth Circuit's holding that the Commission had no authority to set such rates. Id. at 377-86,
Following the Supreme Court's remand on the "impairment" standard, the Commission again tackled that issue in the rulemakings now on review. In what we will call the "Local Competition Order," Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, Third Report and Order and Fourth Further Notice of Proposed Rulemaking,
Of particular importance to this case, the Commission decided to make its unbundling requirements (except for two elements) applicable uniformly to all elements in every geographic or customer market. We return in detail to this issue аfter a survey of the elements unbundled by the Local Competition Order:
• Local loops, defined as "all features, functions and capabilities of the transmission facilities, including dark fiber and attached electronics (except those used for the provision of advanced services, such as DSLAMs [DSL Access Multiplexers]) owned by the incumbent LEC, between an incumbent LEC's central office and the loop demarcation point at the customer premises."
• Subloops, i.e., those "portions of the loop thаt can be accessed at terminals in the incumbent's outside plant."
• Network Interface Devices, which include all "features, functions, and capabilities of the facilities used to connect the loop distribution plant to the customer premises wiring, regardless of the particular design of the NID mechanism." Id. at 3801, ¶ 233; 47 C.F.R. § 51.319(b). This broad definition is intended to make the unbundling requirement "flexible and technology-neutral," so as to apply to any new NID technologies that may develop.
• Circuit switching, defined as the "basic function of connecting lines and trunks," including "all the features, functions and capabilities of the switch." Id. at 3805, ¶ 244; 47 C.F.R. § 51.319(c). The Commission made one nаrrow exception to circuit switch unbundling, which we discuss below.
• Packet switching under some circumstances. Packet switches perform "the function of routing individual data units based on address or other routing information contained in the units."
• Dedicated transport, defined as "facilities dedicated to a particular customer or carrier that provide telecommunications between wire centers owned by incumbent LECs or requesting telecommunications carriers, or between switches owned by incumbent LECs or requesting telecommunications carriers." Id. at 3842, ¶ 322; 47 C.F.R. § 51.319(d)(1)(i). The Commission expanded this traditional definition so as to include all high-capacity transmission facilities of specified types and "such higher capacities as evolve over time,"
• Shared transport, defined as "transmission facilities shared by more than one carrier, including the incumbent LEC, between end office switches, between end office switches and tandem switches, and between tandem switches in the incumbent LEC's network."
• Signaling networks and call-related databases. Signaling networks include signaling transfer points, to which each local switch must be connected.
• Operations support systems. These are the "functions supported by an incumbent LEC's databases and information," including "pre-ordering, ordering, provisioning, repair and maintenance, and billing."
So far as we understand, this list is narrower than that which the Court reversed in Iowa Utilities Board only in its exclusion of some circuit switches, as well as of operator services and directory assistance. See
In what we call the "Line Sharing Order," In the Matters of Deployment of Wireline Services Offering Advanced Telecommunications Capability and Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, Third Report and Order in CC Docket No. 98-147 and Fourth Report and Order in CC Docket No. 96-98,
In the "Line Sharing Order" the Commission decided that the high frequency portion of copper loop spectrum should be unbundled as to those loops on which ILECs are currently providing telephone service. The Commission defined the "high frequency" portion as simply any frequency "above the voiceband on a copper loop facility used to carry analog circuit-switched voiceband transmissions." Line Sharing Order,
Such unbundling means, of course, that CLECs and ILECs would share the same copper loop to provide two different services at once. See, e.g.,
The Commission also required ILECs to condition loops, that is, to remove loading coils, bridge taps, and other voiceband transmission enhancing equipment that tends to interfere with DSL service. Id. at 20917; 20952-54, ¶¶ 81-87; 47 C.F.R. § 51.319(h)(5). An ILEC can escape this obligation by demonstrating that conditioning would significantly degrade analog voice service. The Commission explicitly recognized that such a showing would be practically impossible for loops under 18,000 feet.
II. The Local Competition Order
We note at the outset the extraordinary complexity of the Commission's task. Congress sought to foster competition in the telephone industry, and plainly believed that merely removing affirmative legal obstructions would not do the job. It thus charged the Commission with identifying those network elements whose lack would "impair" would-be competitors' ability to enter the market, yet gave no detail as to either the kind or degree of impairment that would qualify. We review the two orders with this in mind.
A. Unvarying Scope
As to almost every element, the Commission chose to adopt a uniform national rule, mandating the element's unbundling in every geographic mаrket and customer class, without regard to the state of competitive impairment in any particular market. As a result, UNEs will be available to CLECs in many markets where there is no reasonable basis for thinking that competition is suffering from any impairment of a sort that might have the object of Congress's concern.
One reason for such market-specific variations in competitive impairment is the cross-subsidization often ordered by state regulatory commissions, typically in the name of universal service. This usually brings about undercharges for some subscribers (usually rural and/or residential) and overcharges for the others (usually urban and/or business). Petitioners' opening brief in the Local Competition Order case cites testimony of a former FCC Chairman for the proposition that 40% of telephone service is charged below cost, Petitioners' Br. at 35 & n.16, and the Commission and its supporting intеrvenors do not demur. See also, e.g., Robert W. Crandall & Thomas W. Hazlett, Telecommunications Policy Reform in the United States and Canada, at 18, Working Paper 00-9, AEI-Brookings Joint Center for Regulatory Studies (Dec.2000) (chart showing that in many American cities, businesses are charged substantially more than residences for single lines); see also generally ROBERT W. CRANDALL & LEONARD WAVERMAN, WHO PAYS FOR UNIVERSAL SERVICE? WHEN SUBSIDIES BECOME TRANSPARENT (2000).
Competitors will presumably not be drawn to markets where customers are already charged below cost, unless either (1) the availability of UNEs priced well below the ILECs' historic cost makes such a strategy promising, or (2) provision of service may, by virtue of economies of scale and scope, enable a CLEC to sell complementary services (such as long distance or enhanced services) at prices high enough to cover incomplete recovery of costs in basic service. The Commission never explicitly addressеs by what criteria want of unbundling can be said to impair competition in such markets, where, given the ILECs' regulatory hobbling, any competition will be wholly artificial. And, although it offers an explanation as to why it is desirable as a general matter that CLECs should have "ubiquitous" unimpaired access to network elements, see Local Competition Order,
But it is in the other segments of the markets, where presumably ILECs must charge above cost (at least above аverage costs allocated in conventional regulatory fashion) in order to offset their losses in the subsidized markets, that the gap in the Commission's reasoning is greatest. In finding that the CLECs' lack of access to each of the many elements "materially diminish[ed]" their ability to provide service, the Commission nowhere appears to have considered the advantage CLECs enjoy in being free of any duty to provide underpriced service to rural and/or residential customers and thus of any need to make up the difference elsewhere. As a matter of pure language, perhaps, one might regard as an "impairment" any cost disadvantage that the CLECs suffer in markets where ILECs are hampered by regulatory redistribution, even if the disadvantage is fully offset by the exigencies faced by ILECs. But the Commission has never explained why such a view makes sense. Indeed, pointing to evidence of considerable investment by CLECs in facilities for service in what are evidently the relatively overcharged markets, see, e.g., Petitioners' Br. at 16 (noting that as of 1999, CLECs had deployed transport facilities in all of the top 50 markets), the petitioners argue that there has been little or no real net impairment. The Commission responds with an expression of doubt whether these "data accurately reflects [sic] the extent to which alternatives are actually available to competitors." Local Competition Order,
We now turn to the reasons offered by the Commission for adopting an undifferentiated national rule for each element (with narrow exceptions). Having found legal authority to adopt such a rule, it said that it would help achieve the goals of the Act, to wit: (1) rapid introduction of competition, (2) promotion of facilities-based competition, investment and innovation, (3) certainty in the marketplace, (4) administrative practicality and (5) reduced regulation. See Local Competition Order,
We first address the third and fourth justifications, both of which seemingly turn on how clear any non-universal rule can be. The Commission appears simply to assume that any such rule would be unpredictable and hard to apply. Yet the Commission itself, in regard to circuit switches, chose a partial rule, denying unbundling for local circuit switches serving customers with four or more lines in the highеst-density zone in any of the top 50 Metropolitan Statistical Areas ("MSAs"). See Local Competition Order,
As to reduced regulation, the Commission says that a national list "will result immediately in reduced regulation." Id. at 3762, ¶ 143. It does not elaborate on this counterintuitive proposition. It goes on to say that a national list is consistent with "the deregulatory goals of the Act":
Reduced regulation will occur as we remove elements from the list as requesting carriers are no longer impaired without access to those elements, and it otherwise does not further the goals of the Act to continue requiring incumbent LECs to unbundle them.
Id. We understand that elimination of an entire universal mandate at one whack will achieve more deregulation than removal of a partial mandate. But imposition of a national mandate does not itself entail national elimination, and in any event we cannot see how imposition and then retraction of a national mandate is more deregulatory, overall, than imposition and retraction of a partial one.
This leaves the more substantive justifications — the ideas that universal rules would promote the goals of the Act by leading to rapid introduction of competition, Local Competition Order,
But the Commission never makes the argument in quite so stark a form, unwilling to embrace the idea that such completely synthetic competition would fulfill Congress's purposes. Thus it turns to the argument that universal rules promote investment and facilities-based competition.
The Commission says that "adoption of a national list" will "facilitate the deployment" of competitive facilities. Id. at 3757, ¶ 134. There are plainly two sides to the effects on investment of ubiquitously available UNEs at Commission-mandated prices. On one side, the more widespread the availability of elements that can be more efficiently provided by the incumbent (presumably because of econоmies of scale and scope — an issue to which we'll return), the quicker competitors will set about providing the other elements and offering of complete competitive service, including long distance service. Compare Iowa Utilities Board,
On the other side, the petitioners argued before the Commission that mandatory unbundling at Commission-mandated prices reduces the incentives for innovation and investment in facilities. Their reasoning, of course, is that a regulated price below true cost will reduce or eliminate the incentive for an ILEC to invest in innovation (because it will have to share the rewards with CLECs), and also for a CLEC to innovate (because it can get the element cheaper as a UNE). Indeed, many prices that seem to equate to cost have this effect. Some innovations pan out, others do not. If parties who have not shared the risks are able to come in as equal partners on the successes, and avoid payment for the losers, the incentive to invest plainly declines.2 See Iowa Utilities Board,
The Commission's only response is to point to evidence that both CLECs and ILECs have built facilities since passage of the 1996 Act (thе same evidence invoked by the ILECs to show the existence of many markets where unbundling is unneeded), despite the Act's obviously having created a prospect of unbundling. Local Competition Order,
In the end, then, the entire argument about expanding competition and investment boils down to the Commission's expression of its belief that in this area more unbundling is better. But Congress did not authorize so open-ended a judgment. It made "impairment" the touchstone. The Commission argues that § 251(d)(2), directing it to consider necessity and impairment "at a minimum," clearly allows it to consider other elements. We assume in favor of the Commission that is so. But to the extent that the Commission orders access to UNEs in circumstances where there is little or no reason to think that its absence will genuinely impair competition that might otherwise occur, we believe it must point to something a bit more concrete than its belief in the beneficence of the widest unbundling possible.
Besides the analysis described above, the Commission addressed the question whether Iowa Utilities Board precluded its adoption of universal rules for each network element. It concluded that nothing in thаt opinion would require it "to determine, on a localized state-by-state or market-by-market basis which unbundled elements are to be made available." Local Competition Order,
B. Kinds of Cost Disparities
Petitioners complain that the Commission myopically focused on "cost differences," thereby skеwing its inquiry to produce the maximum unbundling.
Of course any cognizable competitive "impairment" would necessarily be traceable to some kind of disparity in cost. Indeed, the ILECs argued before the Commission and the Supreme Court that Congress intended that the impairment standard embody the criteria of the "essential facilities" doctrine, see Iowa Utilities Board,
Petitioners' position here is fundamentally that the Commission relied on cost disparities that, far from being any indication that competitive supply would be wasteful, are simply disparities faced by virtually any new entrant in any sector of the economy, no matter how competitive the sector. See Petitioners' Br. at 28. Indeed, the Commission's order does reflect an open-ended notion of what kinds of cost disparity are relevant.
For example, in the discussion of local switching, the Commission notes that there are economies of scale in switches, Local Competition Order,
The Commission of course has recognized that marketplace changes and increases in competition may justify later reductions in unbundling mandates. See, e.g., Local Competition Order,
Each unbundling of an element imposes costs of its own, spreading the disincentive to invest in innоvation and creating complex issues of managing shared facilities. See Iowa Utilities Board,
Petitioners here do not explicitly attack the Commission for its refusal to incorporate the essential facilities doctrine, and we do not intend to suggest that the Act requires use of that doctrine's criteria.4 But what we do say is that cost comparisons of the sort made by the Commission, largely devoid of any interest in whether the cost characteristics of an "element" render it at all unsuitable for competitive supply, seem unlikely either to achieve the balance called for explicitly by Justice Breyer or implicitly by the Court as a whole in its disparagement of the Commission's readiness to find "any" cost disparity reason enough to order unbundling. The Commission's addition of a materiality notion, see Local Competition Order,
Because the Commission's concept of "impairing" cost disparities is so broad and unrooted in any analysis of the competing values at stake in implementation of the Act, we cannot uphold even the two non-universal mandates adopted by the Commission (for circuit switches and packet switches).
Petitioners also attack the rules on specific elements. Some of these attacks parallel the universality and cost-disparity issues already discussed. Petitioners' critique as to advanced services equipment coalesces with the issues they raise about the Line Sharing Order (see below). This leaves two issues, neither of which we need address here. First, petitioners attack the Commission's requirements of certain information disclosure and "loop conditioning." After remand, these issues may well be moot, and if they recur will do so in a different context. Second, petitioners argue that the "enhanced extended link" condition to the exception to the switch unbundling mandate is in reality a mandate to combine otherwise uncombined network elements, and is therefore invalid. The Supreme Court appears to have definitely removed the basis of this claim, holding that the Commission has authority to require such combinations, affirmatively — that is, not merely as a condition to an unbundling exception. See Verizon,
III. The Line Sharing Order
Petitioners primarily attack the Line Sharing Order on the ground that the Commission, in ordering unbundling of the high frequency spectrum of copper loop so as to enable CLECs to provide DSL services, completely failed to consider the relevance of competition in broadband services coming from cable (and to a lesser extent satellite). We agree.
The Commission's own findings (in a series of reports under § 706 of the 1996 Act) repeatedly confirm both the robust competition, and the dominance of cable, in the broadband market. The first § 706 report found that "[n]umerous companies in virtually all segments of the communications industry are starting to deploy, or plan to deploy in the near future, broadband to the consumer market," including "cable television comрanies, incumbent LECs, some utilities, and `wireless cable' companies." In the Matter of Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of the Telecommunications Act of 1996,
Relying on the Commission's repeated findings, petitioners argue that it is "antithetical to the 1996 Act's language and deregulatory objectives" to mandate unbundling in a market that "already has intense facilities-based competition." DSL Petitioners' Br. at 3. They note the Supreme Court's observation that a proper "impairment" standard should be limited by the "goals of the Act." Id. at 23 (quoting Iowa Utilities Board,
The Commission's response to this argument is to say that it was "merely adhering" to the letter of the statute: Thus it quotes the instruction of § 251(d)(2)(B) that it consider whether "failure to provide access to such network elements would impair the ability of the telecommunications carrier seeking access to provide the services that it seeks to offer." DSL Respondent's Br. at 20, quoting 47 U.S.C. § 251(d)(2)(B) (emphasis added by Respondent). On this theory the Commission believes it was justified in focusing solely on DSL because that is what "CLECs seek to offer when they request line sharing." Id. at 21. The Commission thus appears to acknowledge that it adopted the Line Sharing Order with indifference to petitioners' contentions about the state of competition in the market.
The Commission's inference from § 251(d)(2)(B)'s allusion to the services the requester "seeks to offer" strikes us as quite unreasonable. See Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc.,
Accordingly, the Line Sharing Order must be vacated and remanded. Obviously any order unbundling the high frequency portion of the loop should also not be tainted by the sort of error identified in our discussion of the Local Competition Order and identified by petitioners here as well.
Petitioners аlso claim that the Commission without explanation reversed a prior decision that a portion of the spectrum of a loop cannot qualify as a "network element." The Commission urges that any language suggesting such a view is explicable as simply reflecting a judgment on technical feasibility, which it here reversed on the basis of a reexamination of the facts. Line Sharing Order,
Finally, petitioners attack the Commission's pricing rule, which limited an ILEC's charges for access to the high frequency portion of the loop to the value the ILEC "allocated to [asymmetric] DSL services when it established its interstate retail rates for those services," even where this rule would reduce the charges below the level derived from the Commission's general UNE pricing principles. Line Sharing Order,
* * *
We grant the petitions for review, and remand both the Line Sharing Order and the Local Competition Order to the Commission for further consideration in accordance with the principles outlined above.
So ordered.
Notes:
Notes
There are numerous types of DSL technology: ADSL (asymmetric DSL, in which upstream transmissions are much slower than downstream), HDSL (high-speed DSL), UDSL (universal DSL), VDSL (very-high-speed DSL), and RADSL (rate-adaptive DSL). See Line Sharing Order,
The Commission's standard for deciding that a network element should be unbundled — whether lack of access to it "materially diminishes" the requesting carrier's "ability" to provide the services in question — implicitly builds in a relation to the prices at which CLECs get access to UNEs. (The Commission is rarely clear on precisely what costs are being compared, but in saying that lack of access to unbundled elements would cause a material increase in cost it often uses terms implying that the comparison is to the Commission-mandated price of unbundled elements, i.e., at present TELRIC. See, e.g.,
Compare William J. Baumol,On the Proper Cost Tests for Natural Monopoly in a Multiproduct Industry, 67 AMER. ECON. REV. 809 (1977) (proposing concept of "subadditivity" for ascertainment of natural monopoly), and WILLIAM W. SHARKEY, THE THEORY OF NATURAL MONOPOLY (1982) (further development of subadditivity).
We note that scholars have raised very serious questions about the wisdom of the essential facilities doctrine as a justification for judicial mandates of competitor access, and accompanying judicial price setting. See, e.g., Areeda & Hovenkamp,supra, at ¶ 771c. But a doctrine that is inadequate for that purpose may nonetheless offer useful concepts for agency guidance when Congress has directed an agency to provide competitor access in a specific industry.