Abstract: This article probes into several basic problems existing in the establishment of telecom Universal Service policy in the development of China’s telecommunications. It contains the definition and goal of Universal Service, describes the status and its development and, based on the other countries’ experiences, comes up with the criteria of classifying its objects and areas. In the end, it provides the principles that should be followed in establishing China Telecom Universal Service fund.

Key words: telecomenterprises, UniversalService, compensationmechanism