The third edition of the authoritative ITU/TeleGeography Inc. “Direction of Traffic” publication focuses on the transition in international telecommunication traffic away from the bilateral regime, based on accounting rates, to a new, multilateral, trade-based regime. Specifically, the report looks at the impact that the changing telecommunication environment will have on developing countries.This report examines traffic trends; the transition of the international telecommunications environment and its move towards cost-orientation; cost and price trends; developing country concerns; transit traffic and profits and losses.