The Study Of Chinese Telecommunication Universal Service

According to western classic economics theory, the core features of the telecommunication industry can be summed up as follows: high degree of market concentration, unsymmetrical information, externality and public goods. In this industry, the market will be failed and the government must intervene to ensure the validity of the market. Therefore, many countries have established a telecommunication regulatory system, and have made detailed prescription of telecommunication service, of which universal service policy is a very important one.The definition of universal service is "all people can gain basic telecommunication services at affordable price". Since 1990s, Chinese telecommunication industry has experienced several rounds of large-scale reform, whose market structure and regulatory mechanisms has undergone tremendous changes. Before the split reform of telecommunication, our telecommunication universal service obligations were undertaken only by China Telecom, by cross-subsidies among different regions and different businesses. But in recent years, with the further telecommunication reform, competitive intensification of the universal service in many high-cost areas made cross-subsidies continue or develop difficultly. How to establish a new mechanism is an urgent issue in competitive environment.Based on the changes of the market structure in Chinese telecommunication industry, the thesis collects and analyses the data of some countries and regions, in which telecommunication universal service accomplished successfully, moreover, it specifically addresses four points as follows, by using traditional western economic theories and econometric tools.Firstly, combining the public networks development model theory from Noam, the externality of public network theory, the transaction cost theory and econometric tools, the article demonstrates that implementing Chinese telecommunication universal service is indispensable, which can play an important role in the internality of the network externality, the realization of income redistribution and the improvement of regional economic imbalance. Secondly, by comparing the compensation mechanism of cost, compensation mechanism of revenue, compensation mechanism of price subsidies, and subsidy for mobile communications, the paper advises that should persist in the compensation mechanism which performs the revenue compensation mechanism and the cost compensation mechanism simultaneously, and that should persist in the design...