Adaptive Regulation Contours of a Policy Model for the Internet Economy

1. Introduction For over a century, nations' telecommunications networks ─ whether privately or publicly owned ─ were established and maintained under monopoly regulatory regimes. In recent years, many nations have been transitioning from monopoly to competitive regimes and their telecommunications sectors are experiencing rapid rates of technological change. These changing circumstances are challenging nations' abilities to design and implement sustainable telecommunications policies-that is, rules that are politically adoptable and for which the desired policy goals are reasonably likely to be achievable given the conditions for economic viability in network investment. Notwithstanding losses in some forms of economic efficiency, monopoly tele-communication regimes have been sustainable and relatively stable over long periods of time. Given the then prevailing technological characteristics of supply, the economic conditions created by legal barriers to entry also permitted the pursuit of numerous social goals, such as universal service. Furthermore, once established, the institutions that developed to oversee and enforce the regime – which, in the U.S. consisted of federal and