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In fact, that's why they should invest in their own facilities.

Until structural separataion happens, ILECs get to define "cost" in the most anticompetitive way possible.

Won't happen until all competitors are paying the real price of the underlying network, and not hiding behind regulatory and union incumbency enhancements. That is the idea behind structural separation.

Until structural separataion happens, ILECs get to define "cost" in the most anticompetitive way possible.

I'm not sure I follow. First, the ILECs already paid for their networks and continue to do so. Second, the ILECs DON'T get to define cost. The FCC defines the cost of the ILEC networks for purposes of setting the rates the CLECs have to pay. And those "costs" are measured by constructing a hypothetical least-cost network. In other words, the ILECs don't get to charge the cost of the equipment that's actually in place and being used by the CLECs but instead have to charge what the cost would be if their network were instantly rebuilt with state-of-the-art, least-cost technology. Read the Supreme Court's decision upholding the FCC's rules (not because they were right or economically sound, but because they fell within the range of possible interpretations of the statute that the FCC could adopt). The decision is Verizon v. FCC, 535 U.S. 467 (2002), and can be found here. I think you'll agree that the ILECs don't set their own network costs. And again, please tell me how structural separation will promote facilities-based competition.

Until structural separataion happens, ILECs get to define "cost" in the most anticompetitive way possible.

Say what? It appears you are misinformed. The ILECs don't get to define the "cost" CLECs are charged when they rent the ILECs' networks. The FCC does. And the FCC requires those costs to be measured not with reference to the actual equipment that is in the network, but with reference to a hypothetical network that assumes the entire network is rebuilt with state-of-the-art, least cost technology--that is, “measured based on the use of the most efficient telecommunications technology currently available and the lowest cost network configuration, given the existing location of the incumbent[’s] wire centers.” 47 CFR §51.505(b)(1). The Supreme Court describes it here. And again, tell me how structural separation or reducing the cost of reselling the same services over the same wires creates real competition or the benefits it produces (higher output, technological innovation, lower prices). The MVNO example is interesting, but that is a completely different model, IIRC. Specifically, the facilities-based wireless carriers are NOT obligated to make their services available for resale, nor does a regulator set their wholesale prices. If I am right, the reason the MVNO model works (I assume it does) is that all parties to the transaction are free to make rational economic decisions, and have done so. In this sense, your MVNO example proves my point: forced sharing, expropiration, and price controls don't work; allowing economic actors freedom of choice within the bounds of the rule of law does.