Vodafone warns Australians will continue to be ‘held hostage to Telstra’

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Telstra
A man uses his mobile phone in front of a Telstra logo in central Sydney, August 13, 2009. Reuters/Daniel Munoz

Vodafone warned that Australians from regional areas would still be “held hostage” over mobile phone plans. Cheaper prices, choices and greater coverage may not be accessible for some under a new decision from the competition watchdog not to "declare" wholesale domestic mobile roaming service.

The warning comes after the Australian Competition and Consumer Commission’s report into mobile roaming that denies competitors access to Telstra and Optus’ regional mobile phone networks. Dan Lloyd, Vodafone chief strategy officer, said the draft decision is a “missed opportunity” that would see many Australians “held hostage to Telstra.”

“This could have given every regional Australian a choice of provider so there’s competition in price and there’s innovation in services, but they’re missing out on the opportunities for extended coverage,” he said. He hopes that ACCC, which is set to release its final report in mid 2017, will alter its decision.

The draft report from the ACCC finds “insufficient evidence” that opening existing networks to other providers will result to better coverage outside the nation’s cities. ACCC chairman Rod Sims said the move would deliver greater competition in both regional and rural Australia. However, it may also make the mobile phone prices higher.

For Telstra chief executive officer Andy Penn, the ACCC’s draft decision is correct. Penn said it is the right decision not only for businesses, but also for the people and communities of regional Australia.

Last week, Sydney Morning Herald reported that Telstra shares rose after the competition watchdog ruled the Telstra must not be required to share its network infrastructure with its competitors. The telecommunications giant’s shares reportedly rose by almost 5.1 percent. If the decision was different, Goldman Sachs telecommunications analyst Kane Hannan estimated a $550 million loss for the company.

“If this decision is confirmed, I look forward to Telstra getting on with the job of supporting regional Australia and even more investment,” news.com.au quotes Penn. He said the draft decision guarantees that the industry still has the incentives to invest, adding that it means getting closer to an “exciting work” that will positively impact people who live, work and visit regional areas.

Andrew Sheridan, Optus vice president of corporate and regulatory affairs, said the company was "very pleased" with ACCC’s draft decision. In a statement, he mentioned that the mobile sector has been the stand-out success story in telecommunications competition. Meanwhile, TPG general counsel Tony Moffatt said they are somehow surprised at ACCC’s decision. For other news about Australia, see Al Jazeera English report below.

Al Jazeera English/YouTube

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