The landmark Telco Act aimed to spark competition in part by opening up access to the local loop. Instead it triggered corporate anxiety, especially among local phone companies, which feared they were being asked to sell off the family jewels in exchange for permission to enter new markets, like long distance. The response was a slew of megamergers as major local and global service providers bulked up on corporate calories in the face of what they feared would be a fight for survival. Little has been seen of the lower prices or new services envisioned by Congress.

No one knows this better than the PC companies. Increasingly they sell systems because they attach to the Net. In fact, one of the few new areas where desktop makers can turn a profit these days is in delivering new users to Internet service providers. But PC makers are hitting a wall in their abilities to deliver fast Internet access because the local telcos are dragging their feet in providing fast digital-subscriber-line services, fearing they will not be able to recoup their costs if they have to grant all comers access to these lines. That's why Compaq, Gateway, Intel and Microsoft are joining with local phone companies to ask for a new deal from the FCC. In brief, their petition requests a simplification of the rules so that telcos can immediately enter some long-distance services in exchange for a pledge to offer a kind of basic access to available pieces of their copper infrastructure and central-office systems. The request falls short of requiring telcos to share any enhanced systems, like DSL.

This is an interesting compromise, but it warrants scrutiny. For instance, it's not clear how regulators would enforce the requirement that local telcos open their systems to all comers. And the telcos still need to demonstrate they will support competitors with access at a fair price-down to letting them plug circuit boards into their existing systems. The FCC needs to hold its resolve about cracking open this legal logjam, and in doing so get to the point where real competition can put the Web back on Internet time.