This study concentrates on new entry by airlines with low cost operating strategies. Low cost strategies have been the most successful in competing with network carriers whose very size confers certain competitive advantages. The purposes of this study are to report in detail on the very rapid growth and competitive successes of low cost carriers, the resulting consumer benefits, to identify where low cost service has not yet succeeded and the higher prices consumers are paying there as a result, and to reaffirm the Department's resolve that new entrants be given a fair chance to compete and to examine why low cost new entry is more successful at some cities than others. The data contained in this study provide insights about the traffic stimulation effects and related potential economic effects on various airline constituencies of low cost service, and implications for continued industry restructuring. 45p.