Strategic Challenges in a Global Market
Chapter 8: International Structural Adjustment: The Case of the Baby Bells
8. International strategic adjustment: the case of the Baby Bells 8.1 INTRODUCTION The previous chapter has drawn attention to the changing nature of the US telecommunications industry. Intense competitive pressures have emerged as regulatory and technological developments have encouraged industry consolidation and substantial infrastructure investments. In contrast to the previous chapter, the focus here is on the international activities of the USbased Baby Bells.1 Whilst it may be tempting to consider the domestic and international strategic adjustments in isolation from one another, they are in fact two sides of the same coin. They are, in other words, interrelated with the regulatory framework under which they laboured initially, encouraging their internationalisation and more recently their de-internationalisation. By recognising that the domestic and international are linked and adopting a longitudinal approach to the analysis, we are able to make an assessment of Baby Bell internationalisation that is more accurate than previously has been the case. Chan-Olmstead and Jamison (2001), echoing earlier commentators such as Hausman (1993), Kupfer (1991) and Watson (1993), argued that they had developed signiﬁcant international holdings while Ratner (2001) suggested that the Baby Bells were abandoning their international markets in favour of the United States. Ratner proved to be the more accurate of the two assessments, though the extent to which they de-internationalised was underestimated. With this in mind, the chapter begins by oﬀering a brief overview of the Baby Bells before turning its attention to their internationalisation and subsequent deinternationalisation. 8.2 THE BABY BELLS In early...
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