Summary: Most countries consider that variations of the long-run incremental costs (LRIC) model are still the appropriate way of determining costs of services including those offered by NGNs. There is, however, no consensus as to the necessity of adopting new models. Some countries consider that there is no need for new models because, in a competitive environment, prices are set freely and by agreement as regards interconnection. Other countries, on the other hand, consider that new cost and tariff models will be appropriate for NGN services.
Guidelines: Recognizing that cost models remain useful tools for regulation with a view to setting wholesale tariffs, identifying anti-competitive practices, estimating net costs of universal service obligations and establishing retail tariff control, countries must assess the level of development of NGN services in order to design suitable models.