The subsidies that Telstra currently enjoys for providing rural and remote services cannot be justified according to reports due to be tabled to the government this week.
Telstra provides services to remote Australia under the Universal Service Obligation (USO). Other telcos must contribute to the costs, an amount which has been in dispute for several years.
The USO is a requirement that ensures telephone services across Australia adequately meet the needs and demands of people wherever they are. The government has appointed Telstra as USO provider but other carriers also contribute to the costs.
The independent reports into the USO are due to be presented to the federal government later this week.