We are delighted to present this fourth edition of the International Telecommunication Union’s (ITU) World Telecommunication Development Report, this year on the theme of universal access to telecommunications. The report has been specially prepared for the second World Telecommunication Development Conference taking place in Valletta, Malta (23 March - 1 April 1998).

To an economist, most complex issues can be reduced to a simple equation of supply and demand. In the telecommunications sector, economists have rarely had to worry about demand because, as demonstrated in chapter two, it is abundant. Instead, it has been the supply of telecommunication services which has proved problematic.

Universal service is a concept that has increasingly become focused upon connection of individual households to the public telephone network. The objective of universal service has come to be equated with a telephone in every household. In most developed countries, this objective has come close to being achieved and those families who do not have a telephone are few in number: typically those in remote areas or inner cities, the very poor or those who, by choice or by misfortune are without a private telephone service.