ACCC "NO" to Telstra/TPG cooperation in regional Australia

Electronics & Technology NBN
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I’ve just received the below content in Charlie Brown’s weekly Life & Technology newsletter.
I’d be interested to know if anyone disagrees with his analysis of the ACCC decision and can explain why? All I heard was the ACCC said it could reduce competition.

"ACCC Says No To TPG/Telstra Regional Tie Up

The ACCC has been deciding whether Telstra and TPG (Vodafone) should be allowed to have a mobile network sharing arrangement in regional Australia.

It would mean, you take ALL the Telstra and Vodafone towers in regional Aus, remove the ones where there is duplicate coverage (two towers in one location) and let customers that subscribe to both companies use this new network. Its a bit more complicated than that, but you get the gist of the suggestion.

The benefit? Better regional coverage in the bush. Even better than the current Telstra network now. But there is more benefits here. Some of the cheapest phone plans are available by sim card resellers of the Vodafone network (think Kogan mobile and tpg telecom). These services give customers access to the Vodafone network at the lowest cost. The problem is that while Vodafone regional coverage is rubbish (we just drove from Sunshine Coast to Sydney – its pretty bad between Byron and Grafton, then bad again Coffs to one hour north of Newcastle) so customers in regional Australia don’t buy them because the service is not as good as the Telstra network (that costs more to access).

So customers in the bush pay more as they stay with Telstra.

Now its no secret that since the merger of Vodafone and TPG, the new company needs to earn a profit (in short, it’s basically not – at least not from selling mobile sim plans!!!) and the new company decided to form a network sharing agreement with Telstra for regional Australia. It meant less Vodafone customers (and their resellers) could access the Telstra network in the bush (which is the best one) on their Voda network accessing sim.

It would also have meant that a customer (like me) who has Vodafone and enjoys their $5 a day international roaming would have also had the benefit of accessing Australia’s best regional network, but at the lower price that Vodafone is offering today.

BUT ACCC says ‘NO’. So customers in the bush need to keep using Telstra – Optus gets the biggest Christmas present since a hacker decided to only release 10k stolen data records and we all get to hear about it a week before Christmas when we are not really thinking about stupid decisions made by Government departments.

One might suggest that as soon as Vodafone gets access to a better regional mobile network they could pump up their prices. Maybe. Maybe. But there is still Optus out there offering good plans and if Vodafone bump up their rates it would be ‘see ya’ to an alternate provider.

Also, satellite is just around the corner. The idea your phone will be able to talk to a satellite provider in the next few years. So, would it not be a good idea to sure up the first part of the mobile network that will be less commercially viable once customers from the city can begin regional roaming on satellite? It appears not.

Its nuts and I don’t get it."

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I don’t have a comment on this except perhaps the ACCC sees it as being anticompetitive. And it would not take long for them to want it elsewhere as well.

Have you tried Boost? https://boost.com.au/. Its the cheapest full Telstra Coverage available except I do believe speeds may be somewhat capped (but still better than Aldi and Woolworths which are on the Telstra Wholesale network and don’t get full coverage…)

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Rather than taking the view of a pundit I would first review the ACCC reasoning.

It is a bit dry reading but recognises a regional ‘gain’ that it deems would be short lived, and would eventually result in Telstra becoming more dominant than it is today.

You can get sat phones today if you are willing to pay.

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It’s a Charlie Brown Christmas?

They have been around for at least a decade, for those prepared to pay. Satellite is not always the answer, though - high latency and limited bandwidth.

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There is no Real Competition and no real brakes on Inflation as the Reserve Bank and the ACCC have no powers to stop Price Gouging. Telstra charges me for a Landline I haven’t used in 6 years and it has a subsidiary company Belong which has a cheaper plan for the same service (No Landline charge). But my point here is Monthly charges for all Services should be Half if not less. We the Taxpayers paid for the Copper, the NBN, Towers and even Satellites then it was handed over to the Private sector to charge us again. The Covid Pandemic showed how the Internet was vital to keep Society and the Economy Ticking over. It’s a Necessity like Water and Electricity and should really be in the hands of Government or a Non Profit private enterprise. Greed has no Rules eg; Current Inflation driven by Price Gouging on all Necessities.

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That is interesting. Is the landline on your NBN plan, if so why not change to another, such as the subsidiary that doesn’t charge for it?

I would like free beer on my birthday.

copper: Yes we did but our glorious leaders then privatised it, so it ain’t ours anymore. Not that it was worth much, it is a stranded asset.
NBN: Yes but it was never going to be free, it was only ever a wholesale service.
Towers: Which towers did the public pay for?
Satellites: The public paid for the satellites for the NBN remote areas (which is a crock) but that service is sold under the NBN rules. There are others in private hands that do better that you can join if you like.

Agreed. It is in government hands at the moment.

Generally no but centrally controlled economies are not a fairyland either if China and DPRK are any example.

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Haven’t changed as I would like to see Telstra change and the Government to regulate the whole Industry more. Free beer equates with a Necessity how? The Copper and NBN were paid for by Us. We are being charged twice because the Private companies are paying to use it then adding bigger profits than they need to maintain it. Had it stayed as a Government ISP we would be charged just for the running costs. What is in Government Hands certainly not the Price Gouging of ISP’s? So to explain unchecked (by Government and the Media) Greed in a predominately Capitalist Society you use Communist Dictatorships as examples. We could just have laws against Price Gouging especially essential Services like the Internet. Lets see Price Hikes on Petrol every Holidays. Or is it privatise the Profits and Socialise the Debts eg: GFC the 2008 Global Fraud Crisis.

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Welcome to capitalism. It may not be perfect, but it’s the system we keep voting for in our democracy - which may not be perfect, but…

A very brief search found no laws specifically against price gouging at the state/territory or at the Commonwealth level. There are laws against collusion in setting prices, and against ‘unconscionable conduct’. It is much more difficult to define ‘price gouging’ - it’s like pornography, you know it when you see it. Most regulators use other terms to describe specific behaviours.

Price gouging is a crime in some other countries (notably the US), but the laws largely apply only during emergencies.

If you feel that RSPs in your area are colluding or are operating unconscionably, your first stop should probably be your state consumer body.

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So you pay for a service you don’t want or need rather than take some action to save money and then add this to the list of things to blame others for.

Perhaps you would be better off overall if you sought out better deals.

It doesn’t in the slightest, it was just a wish that popped into my head like wishing my bills were all halved, it has no reason behind it.

You assume that would be cheaper, it might, it might not.

No they were examples of command and control, ie non-capitalistic economies.

How would that be defined? How would it be measured and enforced? If the price structure of large industries was all artificial what would happen to competition? Are you sure you would be better off?

I get it that you think you are hardly done by. In this society the distribution of wealth has been flowing towards the more wealthy for some time. The problem is that crude measures like price control are not the solution.

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So Raising Interest Rates and Unregulated Price Gouging to bring us to a Recession is Better than doing something about it? Also Capitalism is supposed to pay it’s own Debts hence it’s only reason for supporting the Status Quo Democracies that Bow to the Needs of Multi-nationals eg: Little or No Tax, Fairly loose Regulation, rarely investigated and All Media promoting their Propaganda Daily. They send their Manufacturing to China or Poor third World Countries to minimise Tax and Maximise Profits. This would be acceptable if the Workers had normal working rights and a liveable wage which is not always the case. Even though Fascists are trying to take Democracies not all companies want it because they always use the Military to get the Power for their select few. They need Democracies to finance trillions for things like the WMD War for Oil in Iraq.

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Interesting take on this. Clear to me that Telstra should never be allowed to become or seek to become again the telco bully it was in past years.

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Very interesting article Gregr. Thanks for digging it up and sharing.

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Why should Telstra be singled out?
Governments commencing with the privatisation of Telstra have regularly changed policy, or intervened with ministerial decisions. Is it more convenient to point the finger at the now non-government entity than the succession of ministers and governments which have shaped its existence.

It’s never been a level playing field. That the ACCC has been required to adjudicate is one more reminder.

If Telstra is unworthy, what should be said of that other nationalised asset the Commonwealth Bank’s competitive behaviour? Also the subject of regular attention from the regulators and a Royal Commission. Caught out but largely overlooked by shareholders due to the fantastic returns over time.

Did mum and dad investors in Telstra get a dud deal?

It’s just one of many privatisation decisions affecting consumers directly or otherwise. Consider the sell off of our airports, the establishment of port operation monopolies and progressive privatisation of the national energy assets.

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Because that is the subject of this topic. :roll_eyes:

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The topic opened with discussion of the ACCC decision on the proposed merger. It’s a divided discussion with points raised for and against the decision.

Is it at all possible for the IT News report to be critical of Telstra?
As a partner in the proposal is TPG (the originator?) any less sinful?
“Full reasons published by the ACCC after blocking the proposed Telstra-TPG Telecom tie-up last week are so heavily redacted in key sections that it’s not clear what swayed the regulator in its decision-making.”

There are many reasons for consumers to dislike Telstra. The dislike is not universal.

Was Telstra really a bully or was it simply acting in accordance with the law to protect its competitive advantage and shareholder value?

One only needs to look at how enterprise, the law and governments are related to show the complexity of competition law. Consistency is not assured?

Perhaps the ACCC made a good decision with the TPG and Telstra proposal. It’s not final.

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Mark_m thanks for those interesting articles too. Light Reading is a good new source. FR article is only available to subscribers.

I’d like to agree with your understanding that my reason for posting the original question was not to “single out” Telstra or any other company, but to understand the ACCC’s ruling.

If people would like to share their negative views of Telstra with like-minded people, there is an therapeutic forum available on Facebook they can join Telstra Problems and Complaints

And yes, for the mums and dads that invested in the Telstra privatisations, particularly T2, was an educational evolution. Government privatisations run the gauntlet among different prime ministers and CEOs over time. Who can forget Kevin Rudd’s ‘Adios’ to Sol Trujillo From the Archives: Sol Trujillo's $11.1 million farewell?

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Airports and sea ports are natural monopolies that simply should not be in private ownership.

Our national energy assets have strangely never really been considered ‘ours’ and so Australia often gains very little benefit from them even when prices are high. This of course was one of the reasons behind a ‘super-profits’ tax, but when resources are controlled by a few with loud voices they can apparently persuade our politicians that such taxes are not in ‘our’ interests.