Vodafone Hutchison Australia critical of ACCC’s MTAS proposals

19 Sep 2014

Vodafone Hutchison Australia (VHA) has criticised plans put forward by the Australian Competition and Consumer Commission (ACCC) related to the pricing of the declared mobile terminating access service (MTAS). According to the Sydney Morning Herald, in its submission responding to the regulator’s discussion paper on the matter VHA has claimed that incumbent Telstra’s ownership of most fixed voice lines meant it had generated large amounts of money from the system, while also arguing that cutting MTAS charges would reduce the amount Telstra paid other networks for certain calls. ‘This is not an appropriate time to further enrich Telstra … The declaration of MTAS has been a succession of aspirations, gambles and ultimately missed opportunities. The spurious correlations the ACCC have used in its discussion paper … do not meet the basic standards for evidence commonly used in other legal or regulatory processes,’ VHA was cited as saying in its submission.

However, with VHA claiming that Telstra had not passed on lower wholesale fees to customers, arguing that the price of two-minute phone calls to other networks had actually risen since 2003, the fixed line operator was quick to reject such suggestions as being ‘totally incorrect’. Indeed, Telstra argued that the ACCC’s analysis actually showed that lower prices were being passed through, with the telco noting: ‘Prices for fixed-to-mobile calls have fallen every year for the past decade, including by over 10% each year for the past three years … Telstra has more than passed through the reductions in the MTAS rate to fixed-to-mobile pricing.’

As previously reported by CommsUpdate, last month the ACCC published a discussion paper on pricing the declared MTAS, with this consultation forming part of the MTAS final access determination (FAD) inquiry which got underway in May 2014. In this inquiry the regulator confirmed it would continue regulating terminating services for mobile voice calls until 2019, while also revealing it would begin regulating terminating SMS services for the first time. Having published the paper the ACCC said it was seeking stakeholders’ views on appropriate ways to determine efficient prices for both terminating mobile calls and SMS messages. Further, it also proposed setting a new regulated price for mobile voice termination services, which is currently AUD0.036 (USD0.033) per minute. Submissions from interested parties had to be submitted before the deadline of 29 August 2014.