Universal Telecommunications Services: A brief history and analysis of the issues surrounding the new Australian legislation on the Universal Service Obligation

Australia’s largest telco, the former Government-owned and former monopoly Telstra, is required to fulfil the Universal Service Obligation. This entails: ensuring that all Australians have access to a basic telephone service at standardised and in some cases subsidised prices; providing payphones throughout Australia: answering calls to the 000 and 112 emergency services numbers and ensuring that these are passed on to the appropriate emergency services. Other telcos contribute to Telstra's costs in proportion to their ‘eligible revenues’. The legislative system governing the USO is being changed because of radical changes in the Australian telecommunications network that make the current scheme no longer appropriate. The Australian Labor Government has committed to building a National Broadband Network (NBN) that will connect 93 percent of premises with fibre to the premises (FTTP). The legacy copper pair access network owned by Telstra will be progressively shut down in FTTP areas and services provided over that network by Telstra and others will transition to the NBN. This paper examines the history of universal service in Australia, the new USO regime developed for the NBN era, Telstra’s role in it and the criticisms the Government’s chosen approach has attracted, with a particular focus on the standard telephone service.