Telstra will now allow "spectrum sharing" on its telephone line network, meaning other companies will be able to use the network to gain access to residential and business customers.
The move follows from the unbundling of Telstra's phone lines last year.
Telstra's group managing director infrastructure services and wholesale, Gerry Moriarty, said the industry needs to develop applications to encourage consumer demand for broadband, a key part of Telstra's broadband strategy.
Line unbundling comes when the incumbent in the telecommunications market, in this case Telstra, makes available to other providers individual components of its network, so that other providers can offer a full range of competitive services.
A Telstra spokesman said an example of spectrum sharing, would be Cable & Wireless Optus using the local lines to provide telephone services while a company like Primus Telecommunications could offer broadband services on the same line.
"The industry has gone from a monopoly, to a duopoly, to a situation where there are now more than 70 licensed carriers," Moriarty said.