Telstra guaranteed USO role for 10 more years, price to be agreed

Stuart Corner
Monday, 21 June 2010 15:57

IT Policy - Regulation

The Government has revealed more details of its plans for the new USO company, including that it will contract provision of services to Telstra for the first 10 years of its operation.

The formation of USO Co was announced on 20 June along the heads of agreement for Telstra's participation in the NBN. It is designed to replace the present scheme under which Telstra has prime responsibility for USO provision, in return for a subsidy from other carriers, the value of which will be determined by Government.

USO Co will receive direct Government funding of $100m per year and contributions from telecoms service providers. Additional details of the scheme have been provided on the DBCDE web site.

USO Co will be a wholly Government-owned entity whose functions will include the provision of funding for the delivery of: the USO for voice telephony services and payphones; public interest services such as emergency call handling functions ('000' and '112'); special services such as the National Relay Service; and the migration of voice only customers to a fibre-based service after their Telstra copper is decommissioned.


Starting from the date of its commencement, USO Co will contract with Telstra for the supply of USO services for 10 years. Funding arrangements for contracts between USO Co and Telstra "will be informed by advice from an independent consultancy based on a costing methodology developed in consultation with Telstra," according to DBCDE.

Industry will continue to contribute to the USO cost on eligible revenue principles similar to those used to determine industry contributions to the current USO. However unlike the current scheme where contributions are assessed on revenue from retail service, the new scheme will extract contributions from wholesale providers such as NBN Co.

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