INTERNATIONAL TELECOMMUNICATION UNION
	
	Geneva,  7 November 2001	
	Publication Notice    No.  318-01	

Trends in Economics and Finance
Volume I:  Cost, Tariff and Interconnection Rate Calculation Methodology  –  Application to Case Studies		

via ITU Website    	
This publication is aimed in particular at network operators and regulatory authorities in developing countries who do not have very detailed data at their disposal on their costs or on the development of prices in their market. The first part describes a model for the calculation of telephone service costs, tariffs and interconnection rates. The second part shows how the application of this model in different situations (case studies) allows for the identification of national political demands concerning universal service obligations.
	
Date of publication:	English and French:	November 2001
Spanish:	Forthcoming 	
Language:	English, French and Spanish	
Paper format:	About 110 pages – A4 (21  29.7 cm)	
Electronic format:	Word for WindowsTM – Adobe AcrobatTM PDF	
Article number:	English:
French:
Spanish:	20539 
20540 
20541	
ISBN number:	English:
French:
Spanish:	92-61-09501-1
92-61-09502-X
92-61-09503-8	
Price in Swiss francs:	Catalogue Price:     CHF  50.–
Member States and Sector Members:     –15%
Least Developed Countries:      – 80%
Electronic Bookshop:    CHF  50.–    (No discount)	

Trends in Economics and Finance
Volume I:  Cost, Tariff and Interconnection Rate Calculation Methodology  –  Application to Case Studies

PART  I  –  Cost, Tariff and Interconnection Rate Calculation Methodology
	1	Objective
	2	Basic concepts
		2.1	The concept of cost2.2	Base costs
2.3	Guiding principles
	3	Services considered
		3.1	Telephone services
3.2	Network components3.3	Non‑telephone services
	4	Structure of the telecommunication network
		4.1	Organization of the network4.2	Delimitation of the network
	5	Considerations regarding available costs
		5.1	Analytical cost accounting
5.2	General accounting
	6	Traffic data
		6.1	Traffic data required
6.2	Estimation methods
	7	Cost attribution of components
		7.1	Geographical correction7.2	Direct costs
7.3	Indirect costs7.4	Common costs7.5	Special costs7.6	Spare capacity and inefficiency costs
	8	Cost of services
		8.1	Telephone services cost8.2	Interconnection costs8.3	Network components cost8.4	Reference (benchmark) costs
	9	Profit tax
	10	Universal service obligations
		10.1	Definition10.2	Contributions to universal service10.3	Access deficit
	11	Cost‑orientated tariffs
		11.1	Attribution of profit tax11.2	Attribution of universal service obligations
	12	Cost‑based tariffs
		12.1	Tariff rebalancing12.2	Considerations with respect to elasticity
	13	Consideration of exogenous costs

PART  II  –  Application to Case Studies
	14	Correlation studies
		14.1	Objectives14.2	Classifications14.3	Analysis based on GDP14.4	Analysis by class of fixed-line teledensity14.5	Consumption ratio14.6	Relationship of teledensity to GDP per capita
	15	Universal service obligations in developing countries
		15.1	Demarcation of the field
15.2	Factors involved in decision-making
15.3	General situation in developing countries
	16	Case studies
		16.1	Context and scope of the studies16.2	Results of individual cases: costs and tariff
	17	Necessity of tariff rebalancing and its limits
		17.1	Tariff rebalancing machinery
17.2	Limiting factors
17.3	The typical cases once again
	18	Tariff aspects of the formulation of national universal service policies
		18.1	Universal service obligations and efficiency18.2	Approaches to “availability”18.3	Approaches to “accessibility”18.4	Approaches to “affordability” 

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Article number:  20539	No.  318-01	
Trends in Economics and Finance
Volume I:  Cost, Tariff and Interconnection Rate Calculation Methodology  –Application to Case Studies

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