A LEGAL challenge against the consumer watchdog’s inquiry into mobile roaming has been lodged in the Federal Court.
Vodafone Australia has filed judicial review proceedings over claims of flawed processes in the Australia Competition and Consumer Commission’s (ACCC) roaming inquiry.
Roaming would benefit regional customers, who pay too much for poor coverage, the company said in a statement today.
“We feel so strongly about the impact on consumers, we are taking legal action… We do not believe the process has been carried out properly because a specific domestic roaming service has not been defined by the ACCC.”
Roaming would force telcos to accept pay from their competitors to share network access in areas serviced by one provider.
Vodafone argues it would benefit the patchy mobile coverage, and slow upload and download speeds, that are common problems in many regional areas across Australia.
If the Federal Court accepts Vodafone’s claim and launches a review, it will wade into a commercial standoff with former government monopoly telco provider Telstra, with the other roaming opponent Optus, pitted against the upstart market entrant Vodafone.
On 5 May, the ACCC issued a draft report on its inquiry into mobile roaming. It is taking public submissions until June 16, after which it will make a final determination.
It found that forcing telcos to share network coverage would not increase competition among telcos or push them into increased competition leading to greater network coverage.
“Monopolies don’t drive investment, competition does. Without domestic roaming, the opportunities for investment in areas where it is uneconomical to build more than one network are very limited,” Vodafone said in a response to the ACCC’s determination.
Telstra is opposed to roaming, and forecast a sudden end to its investment to extend its regional network if it were forced to share it with other telcos.
Telstra’s chief executive Andy Penn welcomed the ACCC’s draft determination.
“No company invests money, technology and talent if ultimately it will be required to provide that to its competitors, especially those with their own capital and capacity to invest but have chosen not to do so.”
ACCC chairman Rod Sims said he understood why other telcos would be “irritated” by the head start Telstra got as a government monopoly on mobile network building.
He also did not buy Telstra’s “scare campaign” that investment in network expansion would cease under roaming.
But roaming risked further investment “at the margins” of the network, where Telstra and Optus are engaged in healthy competition to extend their networks in certain rural and regional areas.
The ACCC’s draft report listed a number of concerns for roaming regulation.
ACCC concerns
- Access for all telcos to install network equipment on mobile towers built with taxpayers’ funds (currently, a telco that wins Mobile Black Spot funding to build a tower is permitted to build to a minimum specification, where the tower is too weak to support anything bar their equipment).
- Review the efficiency of the Mobile Black Spot Program
- Ensure the future allocation of spectrum frequency is well-managed
- Improve the accuracy of network coverage maps to allow consumers to make informed decisions.