Eircom says it wants to abandon its obligation to provide telephones to all homes and businesses in the State. The former Telecom Éireann says the provision the universal service required under its licence currently costs €40 million a year.
The company has proposed setting an upper limit on the amount it will spend to connect new users. The customers will then have to pay the balance.
This new measure, contained in a proposal put to the Commission for Communications Regulation (ComReg), would hit residents in certain rural areas who are not already connected to Eircom's network.
"Should the obligation be removed it would be the people in the most disadvantaged regions of the country - from a telecoms infrastructure point of view - who will suffer most," Mr Simon Coveney, the Fine Gael spokesman on communications, said.
"Eircom are now a private company with a private company mindset. There is an obligation on the regulator to ensure that people do not suffer as a consequence."
The former State-owned phone company moved to downplay the proposal. A spokesman said it was a "response to the issue which was raised by ComReg as part of a review of our universal service obligation".
In the submission, Eircom, which is now owned by US private investors and Sir Anthony O'Reilly, also says it wants to reduce further the number of pay telephones it operates and to have private developers fund the public's access to telecoms services in all new housing developments.
Eircom says these provisions should be included in a "fundamental review" of its existing universal service obligation - a set of conditions laid on the firm because of the monopoly position it enjoys.
The Eircom submission, which has been seen by The Irish Times, says its universal service obligation is a "significant cost burden" on the company. It says that while Eircom accepts a universal service obligation "for the present", a fundamental review of the framework should be undertaken by ComReg.
Eircom also proposes that mobile phone companies should also fall under a similar universal service obligation. The firm says ComReg's current approach which outlines a universal service obligation on just Eircom is flawed.
If mobile firms had an universal service obligation they would have to set up and operate schemes for disabled users and people living on low incomes.
Eircom has also proposed to ComReg that it should lobby that a prerequisite for all planning permission for new residential and commercial developments should be the construction of appropriate telephone access facilities to a public network by a developer.
Under the current regulatory regime, Eircom will not be able to change its universal service obligations unless it gets approval from ComReg. ComReg is reviewing the entire universal service regime and is expected to issue a decision notice shortly.
A spokeswoman for the Minister for Community, Rural and Gaeltacht Affairs, Mr Ó Cuív, said he had no comment to make "at this time". The matter was for the regulator to decide, she said.