Question 29/III - Methodology to be followed for determination of costs
and establishment of national tariffs (continuation of Question 29/III
studied in 1985-1988)

Reasons for the study

Considering

(a) the increase in the cost of network development and in the
obsolescence of telecommunication equipment as a result of rapid
technological progress;

(b) the steadily increasing share of expenditure on network operation;

(c) the fact that an appropriate tariff policy determines the
equilibrium of administration's budgets,

What are the practical methods for determining the cost of
telecommunication facilities and establishing appropriate tariffs,
particularly for use by administrations of developing countries?

Note 1 - The study of this Question should encompass national tariffs,
and the results of the studies should preferably be published in the
form of a manual.

Note 2 - Supplement No.2 to the D-Series Recommendations could be taken
as a
basis for the study of this Question.

Note 3 - The studies conducted during the 1985-1988 study period
resulted in the preparation of Supplement No.3 to Fascicle II.1 of
Volume II of the Blue Book.

The cost determination model proposed and the general principles for the
establishment of public tariffs relate to the telephone and telex
services only; further studies are required in order to extend the model
and principles to other services, and in particular the public telegram
service and specialized networks.