Regional Mobile coverage and competition under the microscope as ACCC considers TPG and Telstra coverage sharing

The ability for over four million Australians to shop around and find a better mobile deal is under scrutiny from the Australian Competition and Consumer Commission which is looking into the proposed network sharing agreement between Telstra and TPG.

Telstra as we all know is Australia’s biggest telco, with the most impressive mobile network of the three. TPG which operates the third network under the Vodafone and other brands has entered into a commercial agreement with Telstra which looks to give its customers access to Telstra’s 4G and 5G network in regional areas.

That “Regional Coverage Zone” as described by the ACCC contains around 17% of the Australian population – that’s around 4.4millon people who, let’s face it – have no other choice for their mobile phone plan than Telstra.

And that is at the very core of this whole situation.

The ACCC has been looking into this as it does any large corporate merger, and although the two companies are not merging, the tight knit nature of the agreement would see the two operating hand in hand in regional areas, with Telstra essentially allowing TPG/Vodafone to compete using its own network, and at the same time Telstra benefiting financially and through access to valuable “spectrum” which TPG owns.

Behind the scenes it’s a fascinating situation, something I don’t think anyone would have expected, not the least Optus.

Optus, among many others made submissions to the ACCC on this proposal, which the ACCC has released a Statement of Preliminary Views on. That statement is wordy to say the least, but it doesn’t in my view show any clear likelyhood that the ACCC will rule in favour or against the proposal.

Having taken numerous corporate and individual submissions, the ACCC is now calling for “interested parties” to make submissions based on their Statement of Preliminary views.

Full disclosure, I made a personal submission in the first round of ACCC investigations because I am passionate about people saving money on their mobile plan. In that submission I said – and still beleive – this will dramatically increase the level of competition and potential for savings for the millions in those regional areas.

EFTM now encourages you to make your own submissions to the ACCC. It’s really quite simple for you to play a role in this, something that we all should do given it is our hip pocket at play here. You simply email  mergerauthorisations@accc.gov.au with the subject being “YOUR NAME: MA1000021 – submission“

In particular, your personal views on competition between mobile networks is requested. With the ACCC asking the following questions on that:

1. the importance of each factor (e.g. price, geographic coverage, network reliability, speed) on competition between MNOs (Mobile Network Operators such as Telstra, Optus and TPG);
2. whether MNOs’ network investments (including in expanding coverage or densification of sites, and the acquisition of spectrum) have been influenced by investments by their competitors, and if so, the extent to which they have been;
3. the extent to which an MNO’s geographic coverage in regional areas influences its overall success in acquiring and maintaining customers in metropolitan and regional areas;
4. the importance of MNOs being able to supply 5G in metropolitan and regional areas in acquiring and maintaining customers, and alternatively, the significance of the competitive detriment to an MNO if it was to not supply 5G;
5. the degree to which MVNOs (Mobile Virtual Network Operators – such as Kogan, Amaysim, Moose Mobile etc) competitively constrain MNOs.

It would be fascinating for the ACCC to receive submissions from large numbers of everyday Aussies who are living or travelling to those regional areas.

Those questions are just a small number of those asked by the ACCC but from our view, they are the only ones that apply to the general public. The rest appear to be based around network investment, spectrum and other things which are really quite outside the view of the avearage user.

Interestingly, the Australian Trucking Association made a submission in the first phase which supported the Telstra and TPG agreement in which it said, in part “The proposal would improve the quality of regional mobile connectivity and increase competition and choice for regional mobile phone customers.”

It’s really quite simple.

What I find most fascinating is that there’s a huge conversation about regional coverage and investment in that. What should be remembered here is that the Federal Governement has invested hundreds of millions of taxpayers dollars in what are called “mobile blackspot” areas which part funded the MNO’s building towers to provide coverage. Weirdly, those investments never forced the telcos to share those new mobile coverage zones, so many or most were simply benefitial to a single telco.

It appears to me that the ACCC is looking more likely to deny the network sharing agreement, focussing on highly technical arguments and losing sight of what really matters here – competition for consumers.

Imagine living in an area where Telstra is your only network choice. You don’t get Kogan, Felix, iiNet, TPG as price comparisons – under this deal you’d get to choose and likely save BIG dollars.

How that isn’t at the very core of what the ACCC is meant do do, I don’t know.

If you live in regional Australia, take 30 mins of your day to write to the ACCC. You don’t have to be a scholar to do it, just write what you think about the competition in your area now, and how you think that might change.