Here’s proof: Telstra’s USO model is wasting millions says Vodafone

Here’s proof: Telstra’s USO model is wasting millions says Vodafone

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The Productivity Commission's latest report is the final nail in the coffin for the Australia's telecommunications universal service obligation model says Vodafone

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Nobody outside Telstra has any true idea how nearly $300 million a year in universal service obligation funds is being spent, says rival phone company Vodafone's chief strategy officer, Dan Lloyd.

Nobody outside Telstra has any true idea how nearly $300 million a year in universal service obligation funds is being spent, says rival phone company Vodafone's chief strategy officer, Dan Lloyd.

Vodafone wants immediate action by the federal government to ensure regional Australia receives the voice and broadband services it needs following the Productivity Commission’s final report into the Universal Service Obligation (USO).

Vodafone chief strategy officer, Dan Lloyd, described the report was the final nail in the coffin for the current USO model which provides almost $300 million in public and industry funding a year to Telstra, supposedly to fund its copper network and payphones.

“Regional Australia deserves better,” he said

“The calls for USO reform have been growing louder and stronger over recent years, and the need for change is now urgent.

“The final report has confirmed it’s all over for the USO, and the transition to a 21st century framework needs to start now.

“Almost $1 million a day is currently going into a black hole.

“This is a staggering sum of money which could be delivering real benefits for regional Australia.

“The final report not only confirms the fact the USO is well past its use-by date, but highlights the alarming lack of transparency, accountability and controls around the arrangement.

“It is scandalous that nobody outside Telstra has any true idea how nearly $300 million a year, which includes $100m of direct taxpayer funding, is being spent.”

He said it was unacceptable to taxpayers, and to the rest of the telecommunications industry which contributed tens of millions of dollars annually to the scheme, that there are no accountability obligations on Telstra.

The national telco did not even report on how much of the copper line and payphone infrastructure it has actually been shutting down, let alone the actual costs of services supplied under the USO.

Mr Lloyd said the final PC report set out a clear plan and timetable for delivering 21st century voice and broadband services to regional Australia.

“The time for debate and reports is over, and the federal government must act quickly to adopt and implement the Commission’s recommendations,” he said.

Mr Lloyd said Vodafone acknowledged the government had established a USO taskforce to examine the report’s findings.

It must get to work immediately, he said, so the government could soon release detailed plans about how it would transition to a model which delivered the best outcomes for regional Australia and taxpayers.

The story Here’s proof: Telstra’s USO model is wasting millions says Vodafone first appeared on Farm Online.

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