Strategic behavior and competition in cable television: Evidence from two overbuilt markets

This article uses evidence from case studies of Montgomery, Alabama and Paragould, Arkansas to examine the strategic behavior of firms in these markets. Incumbents use a variety of tactics including price cutting and litigation to deter entry by a rival. These tactics and their effects impact on the ability of entrants to come into a market and compete. These findings have implications for policymakers particularly in light of the passage of the Telecommunications Act of 1996.