Even worse, when the local exchange carriers were renting their infrastructure and trying to compete on the thinnest of margins, it allowed the baby bells to see who could survive and who couldn't. Those who didn't survive went under. The successful smaller CLEC's, were then bought by the baby bells for their customers.

They essentially created a test market for their competitors, then simply acquired the ones who presented any kind of competition or had decent enough management to properly manage the very thin margins they were working at.

So yeah, even when the govt thought they had leveled the playing field and allowed competition, all it did was give those baby bell companies another competitive advantage.