ifferent when entry by alternative network capacity is feasible. In that case, the reduction in investment incentives may short- circuit the natural process by which markets diffuse bottlenecks. In the worst case scenario, mandating interconnection can itself have the perverse effect of entrench- ing the existing monopolies in place. Indeed, as discussed in Chapter 8, the absence of an interconnection requirement helped drive the rapid geographical buildout of the telephone network during the early years of the telephone industry, as the Bells and the independent telephone companies competed to satisfy customers. Empir- ical studies have failed to provide any support for claims that mandating access helps facilitate the emergence of facilities-based competition. Empirical studies of The Regulation of Broadband Networks and the Internet unbundling of broadband facilities have drawn similar conclusions (Howell 2002; Kim et al. 2003; Aron and Burnstein 2003; Garcia-Murillo 2005). It is also possible that entry by the new bridge would be wasteful if the welfare benefits did not exceed the fixed costs of creating the second bridge. The optimality of entry depends on how much of the volume captured by the new entrant consists of new surplus created either by better pricing caused by enhanced competition or by the provision of differentiated services that represent a better fit with particular consumers' preferences - called "demand creation" - or simply surplus cannibalized from the existing bridge - called "demand diversion" (Yoo 2004a). By now, the implications for broadband policy should be manifest. The central focus in deciding whether to mandate network neutrality should be on its effect on stimulating competition in the last mile. If it were subject to mandatory inter- connection, standardization, nondiscrimination, and rate regulation, any would-be last-mile entrant would realize that even if it were successful, it would be forced to make its platform available to all content and application providers under rat