backspace key not working on serial over network connection

using PortServer TS 16
we are connecting to a switch console via the portserver
using Console Management profile in the Serial Port Configuration

we then connect to a telnet of digi address with a special port per each serial

the connection works fine, but we cant use backspace to erase commands unless we move the cursor via the <- arrow key to the char we want to erase

i.e.
if i want to erase the word ‘config’ i have to move the cursor to the letter i want to remove via the arrows

I recommend trying the suggestion outlined in the following knowledge base article:

http://www.digi.com/support/kbase/kbaseresultdetl?id=729

Broken link.