Ten-year-old Sam Boulding, who lived with his family on a property near Kergunyah in north-eastern Victoria, died while the family phone was out of order, despite his mother allegedly begging Telstra to fix the phone for 10 days beforehand.
Mrs Boulding reportedly blames Telstra for her son's death, saying emergency services would have been able to offer medical assistance over the phone and tell the family what to do.
The Australian Communications Authority (ACA) was ordered to carry out the investigation into the national carrier last night by the Minister for communications, Senator Alston.
"The investigation will be completed as quickly as possible and I expect the full co-operation of Telstra," ACA acting chairman Dr Bob Horton said in a statement.
Telstra CEO Ziggy Switkowski confirmed that the company would fully co-operate with the investigation.
"I am deeply saddened for the family and very disturbed by the tragedy," Switkowski said in a statement.
The country's incumbent has ordered its own review of the case and auditors PricewaterhouseCoopers will report its findings to Switkowski within a week.
"We are reviewing this tragedy with the utmost seriousness and urgency. We will take whatever action is found to be necessary," he said.
The report by PricewaterhouseCoopers will be shared with the ACA.
The ACA investigation is being conducted under Part 2b of the Telecommunications Act 1997
The terms of reference of the investigation will be finalised today.
The ACA will report to Senator Alston.
Perhaps Telstra SHOULD outsource its maintenance and repairs...just another in a long line of corporate mishaps by this telco, only this time it has led to tragedy. Add this to the top of the Hall of Shame list!