ACCC to scrutinise in-country mobile roaming

The Australian Competition and Consumer Commission has launched an inquiry into whether it should regulate in-country mobile roaming, where an individual outside the coverage footprint of their ‘home’ telco uses another telco’s network to make or receive calls.

The ACCC revealed today it would conduct an inquiry into whether to declare a wholesale domestic mobile roaming service. Declaring a service allows the ACCC to set default conditions under which an access seeker will be able to use infrastructure operated by a carrier or carriage service provider.

“Consumers are increasingly relying on mobile services and the issue of coverage and a lack of choice in some regional areas is a particular issue that has been raised by a number of groups,” ACCC chairperson Rod Sims said in a statement.

The federal government has attempted to boost mobile coverage in regional Australia through its mobile blackspot program, the first round of which helped fund 429 Telstra base stations and 70 Vodafone base stations.

The government has so far committed to three rounds of the program, which has come under fire after an Australian National Audit Office report. The audit found that the first round “did not sufficiently target funding toward the expansion of coverage where coverage had not previously existed”.

The Productivity Commission is currently conducting an inquiry into the future of a key subsidy of regional telecommunications, the Universal Service Obligation (USO), with some telcos calling for the USO to be replaced by an updated scheme that includes a focus on mobile access.

The USO scheme is intended to ensure that all Australians have access to a basic phone service. It is delivered by Telstra over its copper fixed-line network under a $300 million contract. Vodafone and Optus have both criticised the scheme, arguing that its focus on providing a landline service is outdated.

The ACCC has previously considered declaring a mobile roaming service. A report released in 2005 by the competition watchdog said that the organisation was “not satisfied that declaration of the domestic inter-carrier roaming service will promote the LTIE [long term interests of end-users]”.

However that report, which focussed on CDMA networks, noted “concerns regarding structural features in the markets within which CDMA domestic inter-carrier roaming is supplied”.

In the 2004-05 inquiry, neither Optus nor Vodafone supported the declaration of a roaming service.

The ACCC also considered the issue in a 1998 inquiry.

“A lot has changed since 2005,” Sims said. “We do think it’s time we look at the issue again in detail, and examine some of these key matters, including consumer demand, network investment, and barriers to competition. We consider the most efficient way to do that is to consider all of the issues carefully through a declaration inquiry.”

Telstra's corporate affairs chief, Tony Warren, said that the inquiry "will fundamentally determine whether or not regional Australians continue to benefit from investment in mobile communications."

"Where there is a lack of choice of operators for regional Australians, it is the result of decisions by our competitors not to invest in those areas," Warren said.

"Declaring mobile roaming would stop coverage being a differentiator in the Australian market and therefore remove the key rationale for investment in regional Australia for all operators."

Copyright © 2016 IDG Communications, Inc.

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