oyment of that input. The economic cost of producing network services in telecommunications includes the opportunity costs of such inputs as capital, land and land rights, wires, utility poles, towers and fixtures, switches, control systems, construction costs, operation and maintenance expenses, and management costs. The user costs of capital associated with owning plants and equipment is equal to the foregone return from the best alternative investment of expenditures made for the plant and equipment. For most productive inputs, the most accurate measure of opportunity cost is their market value, which is simply the current market price of the input less the avoidable direct costs associated with providing it. The best estimate is based on Pricing of Access to Networks the opportunity cost of the input. For example, if a company owns a plot of land that it could rent to another company for $500, the opportunity cost of using the land is $500. Replacement which refers to the cost of purchasing an input at current mar- ket prices, in turn provides a reasonable approximation of market value. Replace- ment costs are forward-looking costs of constructing the network and include all costs that the utility would incur to rebuild its system, including capital, land, labor services, and management. Accordingly, the market value of the inputs used to create a network includes the replacement costs of facilities and equipment, as well as the user cost of capital evaluated using the market cost of capital, land and land rights evaluated using current market rents, and current operation and maintenance expenses. A good proxy for replacement cost is the recent purchase cost of the input. Of course recent purchase cost is not a perfect measure, because the market price may have changed since the most recent purchase. Nonetheless, in the absence of indicia that more directly measure market value, replacement cost estimates based on comparable transactions provide a workable measure of market value. It is now generally accepted