Why Universal Service Policy in Telecommunications?
Universal service goals exist in every developed country. This suggests that similar benefits for a widespread interconnectivity are perceived around the world, usually independently of the political party in power.6 What is the mechanism leading to such similarity? Perhaps the best way to look at a network is as a cost sharing arrangement  among several users. In telecommunications, fixed costs are high, marginal costs low, and a new participant C helps the incumbents A and B to lower their cost. Subscribers will find it attractive to join a well-sized network, because the high fixed costs of the network can be shared by many, making average costs low. At the same time, the number of subscribers n adds to positive utility, because the more people can be reached, the more useful is the network. This can be seen in Figure 1, where the utility of joining a network rises at first. (The horizontal axis shows the number of network subscribers; the vertical axis depicts average cost (i.e
