ive to share with a broad definition of "network element" will tend to produce widespread sharing of entire incumbent systems under regulatory supervision - a result very different from the competitive market that the statute seeks to create. (535 U.S. at 550-51) Networks in Telecommunications A majority of the Supreme Court would ultimately endorse all aspects of Justice Breyer's reasoning in the Trinko decision, which we discuss at greater length in Chapter 9. As we noted earlier, empirical studies have demonstrated the negative impact that unbundled access has on investments in local telephone facilities. It is for this reason that the unbundled access provisions of the 1996 Act contain some limiting principles. Specifically, it limits UNE access to proprietary elements to which access is "necessary" and without which a new competitor would be "impaired" in its ability to offer competing services (47 U.S.C. $ 251 (d) (2) (A) & (B) (emphasis added)). These limitations recognize that little is to be gained and much is to be lost by compelling access to elements available on the open market for other sources. The FCC has faced nearly insuperable difficulties in construing these limita- tions in a way that makes economic sense. As noted earlier, the FCC needed four tries to develop rules that could withstand judicial scrutiny. And by this time, the unbundling rules had largely become moot, as the FCC had deregulated unbundling of network elements providing service to large business customers and had dereg- ulated key network elements needed to provide local telephone service to small business and residential customers. 6. Regulatory Arbitrage As first noted in Chapter 5, the absence of a unified approach that is consistent across all of the different types of access leaves the regulatory regime vulnerable to regulatory arbitrage. A brief review of the way that access to local telephone networks is priced underscores the nature of the problem. Retail access is regulated by state public utility commissions employing