stors in the high- technology sectors of the economy. After enjoying a meteoric rise between 1998 and early 2000, most high-tech company stocks plum- meted, driving the NASDAQ index down by more than 70 percent in just 18 months. Telecommunications stocks played a major role in this high- tech "bubble," rising to unsustainable heights on the back of exaggerated expectations created by the Internet and falling dramatically in the wake of dashed expectations and a number of corporate scandals. A major change in U.S. regulatory policy coincided with this telecom- munications stock bubble. The 1996 Telecommunications Act opened all telecom markets to competition for the first time and placed regulators in the position of facilitating competition rather than presiding over pro- tected monopolies. This book analyzes the impacts of this tectonic shift in regulatory policy on consumers and telecom companies. I conclude that much of the new policy of assisting new, small-scale entrants was a failure, inducing investors to squander billions of dollars while producing little in the way of new services or innovation. In fact, the new entrants substan- tially depressed productivity growth in the sector. The major development in telecommunications since 1996 involves high-speed connections to the Internet. These "broadband" connections were not generally available to the mass market when the 1996 act was Preface passed and therefore did not feature prominently in the debate over future telecom policy. Nor had the new national wireless carriers, such as PCS Sprint, Nextel, or T-Mobile, begun to compete aggressively with the two established wireless carriers that had emerged earlier from the FCC's 1980s policy. The diffusion of broadband, particularly over cable television sys- items, and the rapid growth of "cellular" wireless systems created a compet- itive environment that could not have been foreseen in early 1996, when the new act was signed into law. Nine years after the passage of the Telecommunications Act, it is quite c