It is a non sequitur argument to suggest that had telco's not been deregulated in the '80s, we would still have had CLECs building out the dialin and ISDN Internet of the '90s; that argument leaves out the fact that the RBOCs the CLECs piggybacked on were themselves the product of deregulation.
I am not sure you understand what "deregulation" is. Certainly an antitrust & monopoly busting lawsuit from the US government is not deregulation. When a regulated monopoly is broken up into smaller, regulated regional monopolies, that is not deregulation. It is also not deregulation when state & federal law has to mandate that line sharing be allowed.
Deregulation is the removal or simplification of government rules and regulations that constrain the operation of market forces.
The break-up of AT&T & the 1996 Telecommunications Act were nowhere near deregulations.
Also I certainly do not believe that AT&T would have broken itself up or the regional operators would have opened their lines up, had it not been for government regulatory actions.