In order to realize the full potential of this evolving information age and make its capabilities available to the greatest number of consumers, the telephone companies must be permitted to participate fully in the information and information-related markets. Indeed, a principal issue during this period of rapidly changing market conditions is the form and degree of regulation required in order for the consumers, the industry, and the general economy to receive optimum benefits. Recently, economic and social forces have combined to increase the importance of efficient telecommunications service to the nation's economy, while at the same time, the demand for telecommunications has expanded in the increasingly competitive global economy. However, market foreclosure, regulatory constraints, and economically inefficient pricing arrangements have hampered opportunities for competition, and the telephone companies have not been able to respond fully to the needs of the marketplace. As a result, the United States is no longer in the forefront in the provisioning of information services. Regulators have now begun to examine their impact on the U.S. telecommunications industry, however, and it is hoped that an altered regulatory process capable of providing more earnings and market flexibility will be adopted in the near future. (KM)