Trends in Economics and Finance

Cost, Tariff and Interconnection Rates Calculation Methodology and Application to Case Studies (Volume I)

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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 taxes. 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.




The whole question of tariffs is crucial to the development of telecommunications, since it is tariffs that will mercilessly make or break anyone setting out in this sector. Negotiating tariffs or rates is hence a delicate matter, whether for the new operator entering a liberalized market and fearful of finding itself lumbered with excessively high interconnection charges, or for the regulator wishing to set low tariffs for national calls without compromising the rules of competition among the various operators.


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