17, 32 (1st Cir. 1990) (Breyer, C.J.). Network Regulation Basics leading Supreme Court cases on vertical integration, 30 suppose that a shoe manu- facturer whose output composed ten percent of the overall shoe market decided to stop distributing its products through the 100 available independent shoe retailers. Instead, this manufacturer purchases ten of the available shoe retailers and sells its shoes only through those outlets. Would this decision reduce competition in either shoe manufacturing or shoe retailing? Although competing manufacturers will not be able to sell their products through the ten shoe retailers that now only sell shoes produced by the vertically integrated manufacturer, the ninety remaining indepen- dent shoe retailers should now have extra capacity from the withdrawal of sales from the vertically integrated manufacturer sufficient to provide distribution for all of the other manufacturers' output. The competitive manufacturers who produce ninety percent of the market are not excluded from the market at all, because they will still have ninety percent of the retail distribution capacity available to them. In this case, vertical integration only serves to realign the patterns of distribution without affecting the market shares of either the manufacturers or the retailers. Nor is it likely that the vertically integrated manufacturer could foreclose the retail market by purchasing more than ten percent of the available retailing capacity. In the absence of entry barriers, any attempt to lock out other manufacturers by tying up retailers or to extract supracompetitive returns in the retailing market would only stimulate entry by new retail outlets that would be ready and willing to dis- tribute the products of the other manufacturers (Director and Levi 1956; Stigler 1968; Peltzman 1969; Posner 1976; Bork 1978). The theoretical literature acknowledges the existence of exceptions to the one- monopoly-rent theorem under which vertical integration can be profitable. As noted earlier, a monopolist s