A battle between Telstra and city councils in Sydney, Melbourne and Brisbane is brewing over the telco's use of payphones as digital billboards and antenna boxes.
Sydney Lord Mayor Clover Moore is expected to call on the federal government to ban the country's biggest telco adding large advertising screens along with 5G small cells to booths.
The Australian Competition and Consumer Commission will also be asked to determine if Telstra's use of payphones for commercial ads is anti-competitive.
"It really is just a cash grab," Sydney Liberal councillor Craig Chung told AAP.
"It's adding to the clutter in the street and there's no thought about planning."
By law, Telstra is obliged to provide reasonable access to payphones for standard telephone services.
But it has recently started upgrading the sites to include 75-inch LCD screens.
Cr Chung said a motion passed by council on Monday night addressing Telstra's obligations and "the installation of unwarranted and unapproved infrastructure" has support from Brisbane and Melbourne.
The City of Melbourne in March refused 81 applications by advertising giant JCDecaux for permits to run commercial ads on the payphones' screens.
It also took Telstra to a Victorian tribunal to stop the telco bypassing planning approval to install more upgraded payphones.
"These new structures are more like digital billboards masquerading as phone booths on the footpaths of our city," Melbourne councillor Nicholas Reece said at the time.
City of Sydney is also expected to call on the federal government to force planning approval for all 5G small cells.
Currently deemed "low impact", the antenna boxes are used to boost 4G connectivity in CBD areas but will be extensively used for the 5G network.
Any change could slow the rollout of new networks being built by Telstra, Optus and Vodafone.
Cr Chung wants all councils to be allowed to install "carrier agnostic" 5G technology to prevent multiple telcos' small cells "cluttering our public domain and streetscapes".
"Let's remember, this is how our entire digital world will operate," he said.
"We're not talking about copper wires running down conduits in streets any more."
Telstra said any use of the screens for commercial advertising is subject to approval by the City of Sydney.
"Our vision for the new payphones is to ensure the technology offered to all users in the City of Sydney is comparable to other major cities such as New York City and Tokyo," it said in a statement on Tuesday.
