Newark, New Jersey -- "Verizon, the state's dominant phone carrier, is threatening to drop plans to install a $250 million fiber-optic network because state regulators will not let it charge competitors more to lease its local lines."
Over the long term, the Bells need to deploy fiber in order to compete with the cable TV companies which have much higher bandwidth cable networks. (The cable operators' coaxial systems have 10 to 20 times as much bandwidth capacity as the Bells' twisted pair infrastructure.)
The cable companies own video to the home. They dominate broadband to the home. Starting in 2005, they'll start taking away a lot of voice customers with Voice over IP (VoIP).
The Bells can let this happen or they can respond by going after the cable companies with all 3 services. Excluding Qwest, the Bells are (for now), much better capitalized than the cable companies. They can do this in theory, but in reality they don't have the savvy or the stomach.
I think of the Bells as dinosaurs marking time waiting for the big meteor strike that's headed their way. They'll join Western Union in the ranks of former communications giants. Perhaps they should start studying the money order business now ...