2–11. Having received approval from the Justice Department and the Federal Trade Commission, Ameritech and SBC Communications received permission from the Federal Communications Commission to combine to form the nation’s largest local telephone company. The FCC gave its approval of the $74 billion transaction, subject to conditions requiring that the companies open their markets to rivals and enter new markets to compete with established local phone companies, in an effort to reduce the cost of local phone calls and give smaller communities access to appropriate phone service. SBC had considerable difficulty in complying with its agreement with the FCC. Between December 2000 and July 2001, SBC paid the U.S. government $38.5 million for failing to provide rivals with adequate access to its network. The government noted that SBC failed repeatedly to make available its network in a timely manner, meet installation deadlines, and notify competitors when their orders were filled. Comment on the fairness and effectiveness of using the imposition of heavy fines to promote government imposed outcomes, rather than free market outcomes.