The Australian Competition and Consumer Commission has issued a draft decision requiring Telstra to give competitors direct access to its customer access network.
Access to the network, which incorporates the copper lines linking customers to local exchanges, would "allow competitors to provide both local calls and high speed data and other enhanced services to customers for the first time", ACCC officials said.
At present, competitors are restricted in where they can connect into Telstra's network, which artificially inflates their costs, the ACCC said.
"With the proposed decision, the ACCC would enable competitors to connect into Telstra's local network, reducing their reliance on Telstra's infrastructure and therefore minimising their access costs.
"As well, the ACCC would secure the rights of service providers to resupply local calls, that is, to sell to retail customers calls they buy in bulk from Telstra".