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I think you have misunderstood the USO and how it works. It is indeed a subsidy to the bush. However Telstra is not obligated by the USO. Every five years Telstra (along with Optus and other telcos) respond to a government tender to provide service in the areas applicable to the USO. These are areas that would not normally be profitable for a telco. Each contender outlines the service they would provide and how much government subsidy they would require to do so. Optus put up a real stink last time when Telstra won the deal. They claimed government bias. They were keen to provide the subsidies USO services. This would suggest that Telstra is hardly disadvantaged by the USO as Optus would be keen to do the same job. The existance of the USO should have no impact on the privatisation of Telstra. Personally I think the USO is not necessary. Services such as those offered by Globalstar already offer affordable unsubsidised services to remote Australia. However the USO does not disadvantage Telstra. Some would argue that it actually gives them a leg up. http://www.globalstar.com.au/
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