In calling for the deployment of high-capacity telecommunications infrastructures, the Clinton Administration is relying on market forces to drive demand toward self-sustaining development. There is little doubt that many firms will embrace the new telecommunications services for a variety of reasons including market differentiation, vertical market integration, and other organization-specific factors. However, there is little evidence at the firm level that adopting the use of increased-capacity telecommunications technologies is associated with improvements in firm profitability. This study seeks to identify the presence of impacts on firm income that can be associated with the adoption of T1 telecommunications services.