ACCC investigates 3G ‘pacts’

26 Nov 2004

The Australian Competition & Consumer Commission (ACCC) will investigate the proposed AUD900 million 3G alliance between Telstra and Hutchison amid growing concerns about the structure of the deal and its implications for competition. The regulator is also reported to be concerned about the alternative alliance between Optus and Vodafone, which in effect could create a duopoly in the 3G market. According to The Australian, the central question the ACCC is seeking reassurance over is how the two alliances will deal with third parties wanting access to the 3G networks. When Telstra and Hutchison announced their alliance last week, Telstra Chief Executive Ziggy Switkowski hinted that the pair would not be inclined to offer access to Optus, nor indeed to any other third party. Telstra later clarified its position in light of the regulator’s comments, stating that 3G would be a ‘declared’ service – open to access from third parties – in the same way their existing 2G networks have been. But suspicion over the companies intentions with their 3G network have remained.

In a separate, but related story, Hutchison has launched an intensive marketing campaign in Australia, aimed at encouraging customers away from rival wireless and wireline companies. Hutch is reportedly offering AUD200 of calls per month for just AUD50 in the run-up to Christmas. At the end of August 2004 Hutch claimed 691,000 customers in Australia, adding between 5,000 and 7,000 new customers per week.