otocol conversion" (FCC 1983b, 1985b, 1985c, 1986a). Absent a waiver of the platform access mandate, the interoperability mandated by the Computer Inquiries would have obstructed this innovation from being deployed (FCC 1984, 1985b, 1986a, 1996e). It is impossible to conclude a priori that stan- dardizing on a single network architecture represents the optimal solution. The process is rendered even more challenging if the technology is undergoing rapid change. Under the best of circumstances, regulation will lock the existing interface into place, at least until the regulatory process can update it. At worst, such tech- nological decisions will be affected by the biases inherent in regulatory processes, in which the concerns of the incumbents tend to be overrepresented. The standardization implicit in platform also commoditizes network services and narrows the dimensions along which local telephone networks can complete. Networks in Telecommunications Product standardization and price transparency make both collusive and noncoop- erative oligopoly behavior easier to maintain. Commoditization also limits networks to competing solely based on price and network size, considerations that reinforce the advantages enjoyed by the largest players. Differentiation can play a particularly important role in industries such as telecommunications, in which the presence of fixed costs that are large relative to marginal costs forces network providers to produce on the declining portion of the average cost curve. As noted in Chapter 4, product differentiation can create stable equilibria with multiple producers, each producing on the declining portion of the average cost curve. Thus, smaller players can survive despite cost and size disadvantages by targeting subsegments of the market. Platform access also gives rise to significant transaction costs, both in terms of establishing the governing standards and in terms of establishing the interfaces and putting into place at those interfaces processes for monitoring and billing th