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Regional communities would miss out under regulated roaming

Regional

Posted on October 26, 2016

4 min read

Australia’s regional communities would not benefit from regulated roaming – in fact it could mean they miss out, writes Telstra Corporate Affairs Group Executive Tony Warren.

The Australian Competition and Consumer Commission (ACCC) has just released a Discussion Paper on the issue of regulated mobile roaming.

This issue means a lot to regional communities as they are the ones who have the most to gain from ongoing investment or to lose through regulated roaming.

The ACCC has set out some of the potential risks that regulated mobile roaming would bring, and we will keep working to set out our concerns about an intervention into Australia’s successful and competitive mobile market.

Australia has one of the best mobile markets in the world. That has not happened by accident but we know there’s always more to do, particularly expanding coverage across regional Australia. This expansion of coverage takes serious investment. At the moment competition between mobile network operators drives investment, investment grows the network, and the result is Australians are able to use their phones and other devices to do more things, in more places, than ever before.

This competitive dynamic has particularly benefited people in regional Australia. Expanding coverage is their number one priority and that’s been our focus too.

Telstra’s investment in our mobile network is heavily skewed towards regional and remote Australia. Over the last 10 years, 15 per cent of our investment in the mobile access network has gone to provide services to the most remote 2 per cent of the population.

This weighting towards regional areas is part of our desire to provide a strong point of difference through our unique national coverage. Even though regional sites may not make a commercial return on their own, their contribution to regional communications and our national coverage claim is vital.

Mobile services are also priced on a national basis, so all customers benefit equally from strong network-based competition. Whether you’re in Bunbury or Brisbane, competition has lowered mobile prices by around 50 per cent (in real terms) since 1998. Data allowances have also tripled in the last 2 – 3 years.

This competitive dynamic would be put under threat by regulated mobile roaming. That kind of intervention would allow our competitors to utilise the Telstra network in areas where we have invested to provide coverage and they have not. Even regulating older mobile technologies like 3G will have an impact on the decisions we make to extend 4G and develop 5G.

Other organisations share these concerns. Representative from regional Australia like the Western Australian Farmers Federation have said “enforcing regulation of mobile roaming, telecommunications companies would be provided with further reason not to invest in regions, which is the opposite of what is needed for people living in rural areas”. Optus – Australia’s second largest telecommunications company – has called regulated roaming “an opportunistic ploy to get access to existing infrastructure without investing its dollars.”

It begs the question – why would anyone invest in maintaining or upgrading their regional networks when they can hitch a ride on someone else’s network and there is no longer any competitive differentiation from greater network coverage?

The number one advocate for regulated mobile roaming is a multi-national company that has chosen not to invest to the extent Telstra has. In fact, they argued against roaming in other countries, where it suited them to do so.

Some of our competitors may say they would be willing to pay a ‘fair price’ to access our network, but that is just a smoke screen to hide their real aims. Regulated roaming means our competitors could instantly claim the same coverage as us, immediately removing our competitive coverage advantage without having to invest a cent. That is not a ‘fair price’ for something we have invested billions of dollars to build over many years.

We will work with the ACCC and regional communities to ensure the consequences of regulated mobile roaming are well understood.

Tags: regional, Roaming,