Telstra says it's possible that schools in other states and territories will join NSW in having to pay more for their line rental if they remain with other carriers.
Schools in NSW have been told the cost of their line rental will almost double from $19 to $35 a month unless they take all phone business back to Telstra, News Ltd reported.
At least 150 cash-strapped schools have switched from Telstra to other providers to save money on phone charges.
But, in a bid to lure them back, Telstra is phoning the schools offering special deals on calls and rental.
Schools that decide to stay with an alternative carrier will be penalised through the higher line rental charge, controlled by Telstra.
Telstra spokesman Warwick Ponder said NSW was currently the only state or territory where the telco was increasing rentals.
"It is only in NSW where this process is underway," Mr Ponder told AAP.
This was because not all state governments allowed individual schools to access alternative carriers, he said.
"Each state and territory government has different contract arrangements, including whole of government centralised bulk discount arrangement," he said.
Asked if schools in other states and territories could also face a price surge he replied: "it's a possibility".
"It is possible in a state where schools are able to go to the market and source their contracts individually."
Mr Ponder also defended Telstra against criticism it's punishing schools for sticking with other telecommunications providers.
"Telstra's shareholders are being asked to subsidise competition, while these companies send their profits back to shareholders overseas," he said.
"It's like trying to get a fuel discount from a service station when you shop at the wrong supermarket, or asking for an upgrade with one airline, when you bought the plane ticket with another."
NSW Education Minister Carmel Tebbutt said her department had written to Telstra to ask it not raise line rentals.
"We are urging Telstra to continue with existing line rental rates and I'ld like to see the federal government step in as the majority shareholder and make sure Telstra isn't exploiting public schools," she told Southern Cross Broadcasting.
An Optus spokeswoman said Telstra was not playing fairly by pushing other competitors out of the market.
"Telstra's latest actions come as no surprise. It is yet another example of Telstra threatening and intimidating customers in order to damage its competitors," the spokeswoman said in a statement.
"We make it a point to deal with our customers fairly and we would expect the incumbent to exercise the same behaviour."
msn Sep 14, 2006
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