Universal service is an economic, legal and business term used mostly in regulated industries, referring to the practice of providing a baseline level of services to every resident of a country. An example of this concept is found in the US Telecommunications Act of 1996, whose goals are:
to promote the availability of quality services at just, reasonable, and affordable rates to increase access to advanced telecommunications services throughout the Nation to advance the availability of such services to all consumers, including those in low income, rural, insular, and high cost areas at rates that are reasonably comparable to those charged in urban areas Universal service was widely adopted in legislation in Europe beginning in the 1980s and 1990s. For instance, under the EU Postal Services Directive (97/67/EC), the Electricity Market Directive (2003/54/EC) and the Telecommunications Directive (2002/22/EC). The language of "universal service" has also been used in proposals by the US Democratic Party for the reform of health care. When the practice is applied to providing media content, a term must-carry is typically used.
Origins of universal service
The concept of universal service appears to have originated with Rowland Hill and the Uniform Penny Post which he introduced in the United Kingdom in 1837. Though Hill never used the term "universal service", his postal system had the hallmarks of early universal service; postal rates were reduced to uniform rates throughout the nation which were affordable to most Britons, enabled by the postage stamp (first introduced here) and a General Post Office monopoly on mail. Hill's reforms were quickly adopted by postal authorities worldwide, including the United States Post Office Department (now the United States Postal Service) which already held a monopoly through the Private Express Statutes. The service obligations of USPS under current law are commonly referred to as the "universal service obligation" or "USO". Universal service is also a key objective of the Universal Postal Union.
Interconnection between telephone exchanges (1907-1960s)
Bell system
In the early history of the telephone up until the early 20th century, telephone service was fragmented. The ability to make a telephone call depended on not just on both parties having telephones, but that their telephone companies used the same standards and that there was a physical interconnect of their networks. The term "universal service" originated with Theodore Newton Vail, president of American Telephone & Telegraph (the original AT&T) and head of the Bell System, in 1907 with the corporate slogan "One Policy, One System, Universal Service". It was intended as a contrast to the "dual service" that had become common since the original Bell telephone patents expired in 1894, where independent telephone companies operated not only in non-Bell System markets, but also as a competitor in Bell markets. These independent phone companies did not interconnect to the Bell System; though modern commentators suggest Bell refused to do so as an excuse for monopolization, it was argued then that phone systems of that day could not interconnect unless all phone companies used the same technology, as the Bell System did. This required many businesses to maintain phones with both companies, or else risk losing customers who subscribed to the other phone company. Vail argued that an interconnected phone system (the Bell System), operated by one company (AT&T) and with rates regulated by the government, would be superior to the dual system and would produce great social benefits, much like Hill's postal reforms. Eventually, Vail prevailed in his views, first through state laws and ultimately through the Kingsbury Commitment of 1913, where AT&T agreed to several measures, including interconnection with non-competing independent phone companies, to avoid antitrust action, thus formalizing the Bell System monopoly. Meanwhile, the Mann-Elkins Act of 1910 made AT&T subject to regulation by the Interstate Commerce Commission. By 1913, AT&T had favored status from U.S. government, allowing it to operate in a noncompetitive economic environment in exchange for subjection to price and quality service regulation. The government asserted that a monopolistic telephone industry would best serve the goal of creating a "universal" network with compatible technology country-wide for telephone consumers. Regulators emphasized limits on profits, enforcing "reasonable" prices for service, setting levels of depreciation and investment for new technology and equipment, dependability and "universality" of service. "Universal" was originally used by AT&T to mean, "interconnection to other networks, not service to all customers". After years of regulation, the term came to include infrastructural development of telephony and service to everyone at a reasonable price.
Willis Graham Act of 1921 The Willis Graham Act of 1921 was called into action in order to resolve pressing issues in the debate about the merits of interconnectivity of telecommunication. The act marks the first piece of legislation in the history of telecommunication to tackle the increasingly difficult challenges of the telecommunication industry in the 20th century. Before the Graham act was passed the commonly expressed opinion was, such as by the Senate Commerce Committee, that telephone service fit the definition of a natural monopoly. The central practical problem, according to the committee, with the Willis Graham Act was competing telecommunication services serving one individual market. The act was in favor of a monopoly, which aimed to exempt competing telephone companies from the antitrust laws and allow them to unify the service by merging competing telecommunication service providers. The main principle behind the act was that there should be only one system in each community through which all users communicate. The focus was exclusively on local service rather than long-distance service, as no independent long-distance lines were able to compete with AT&T.
Communications Act of 1934
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