TY  - JOUR
AU  - Greenstein,Shane
AU  - Mazzeo,Michael
TI  - Differentiation Strategy and Market Deregulation: Local Telecommunication Entry in the Late 1990s
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9761
PY  - 2003
Y2  - June 2003
UR  - http://www.nber.org/papers/w9761
L1  - http://www.nber.org/papers/w9761.pdf
N1  - Author contact info:
Shane Greenstein
The Elinor and Wendell Hobbs Professor
Kellogg School of Management
Northwestern University
2001 Sheridan Road
Evanston, IL  60208-2013
Tel: 847/467-5672
Fax: 847/467-1777
E-Mail: greenstein@kellogg.northwestern.edu

Michael Mazzeo
Northwestern University
Kellogg School of Management
2001 Sheridan Rd
Evanston, IL 60208
E-Mail: mazzeo@kellogg.northwestern.edu
AB  - The authors examine the role of differentiation strategies for entry behavior in markets for local telecommunication services in the late 1990s. Whereas the prior literature has used models of interaction among homogenous firms, this research is motivated by the claim of entrants that they differ substantially in their product offerings and business strategies. Exploiting a new, detailed data set of Competitive Local Exchange Carriers (CLECs) entry into over 700 U.S. cities, the authors take advantage of recent developments in the analysis of entry and competition among differentiated firms. They test and reject the null hypothesis of homogeneous competitors. They also find strong evidence that CLECs account for both potential market demand and the business strategies of competitors when making their entry decisions. This suggests that firms' incentives to differentiate their services should shape the policy debate for competitive local telecommunications.
ER  -