Regional telcos to pick up $6 million Telstra tab

Around 45 of Australia's smaller regional carriers are about to receive bills totalling more than AUD$6 million to subsidise Telstra's commitment to universal service.

The government body that oversees Teltra's four Universal Service Obligation, the Australian Communications Authority (ACA), yesterday opened a tender inviting applications from consultants to tally up the bill associated with that obligation and distribute it around the industry.

ACA spokesman Allan Major said the industry-wide contribution would total up to AUD$300 million.

Every registered Australian telco has been required by law to contribute to costs incurred by Telstra in satisfying its Universal Service Obligation since the 1997-98 financial year, because Telstra is the country's sole national universal service provider.

Major said Telstra would pay about 80 percent of its own USO bill this financial year, with a further 18 percent divided between the country's other large players, including Cable and Wireless Optus, Vodafone and AAPT.

The remaining two percent of the bill - about AUD$6 million - would be divided between smaller regional players, including Adelaide-based Airnet, which last year contributed just AUD$357 to the Telstra bill.

Airnet's business development manager, Chris Pearl, said the company resented paying the bill because it plugged gaps in service that Telstra ignored.

-We are only in business because we believe Telstra has been very heavy-handed in charging for low level service," he said.

He said Airnet objected to reimbursing Telstra's local operation, when the country's largest telco invested so heavily in experimental international activities.

-They should use their profits in their own backyard before jumping overseas," he said.

The ACA's Major said the USO bill was rising gradually, but that Telstra's portion of the payment was diminishing - from about 80 percent to about 75 percent over the next financial year - as smaller players commanded a larger slice of the market.

He said the amount charged to each carrier was proportional to the revenues and assets of each carrier. Around 35 carriers would not be asked to contribute to the cost.

The Universal Service Obligation, which came into effect around four years ago, dictates that Telstra make most telephony services "reasonably accessible to all people in Australia on an equitable basis, wherever they reside or carry on business".

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Talkback 1 comments

    Why is Telstra investing in ov ...Anonymous -- 11/09/01

    Why is Telstra investing in overseas infrastructure?

    Australian tax payers must be very upset about this, having paid all those years to build up what is now known as Telstra, which had the purpose of creating an maintaining Australian infrastructure.

    What do we get for this?
    * rediculous access
    * appalling service levels
    * unreliable service
    * substandard quality
    * false and misleading advertising
    * et cetera...

    In other words we pay taxes to build and maintain our infrastructure and Telstra gambles the funds away overseas.

    Absolutely amazing!

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