ACCC releases final MTR ruling; government outlines plan to update spectrum legislation

25 Aug 2015

The Australian Competition and Consumer Commission (ACCC) has published its final decision on mobile termination rates (MTRs) for the period 1 January 2016 to 30 June 2019. As per its ruling the regulator has said that the wholesale price of terminating calls on an Australian mobile network should be AUD0.017 (USD0.012) per minute, less than half the current rate of AUD0.036 per minute. Meanwhile, operators will now be required to charge AUD0.030 per SMS to receive such messages, with this price said to have been based on the network capacity and equipment used to carry SMS, while it was noted it was ‘well below current commercial rates for SMS termination’. However, with voice-over-LTE (VoLTE) technology expected to reduce the cost of terminating both mobile calls and SMS messages, the ACCC has said it will monitor the planned rollout of such services and may review the regulated rates if there is evidence that it is affecting costs.

Commenting on the rulings, ACCC Commissioner Cristina Cifuentes was cited as saying: ‘The ACCC does not regulate retail charges, either for mobile calls or SMS, but expects these savings … will be passed onto consumers either by way of lower charges or through improved call and SMS inclusions in retail plans. The final regulated rates reflect the costs of terminating calls and SMS messages on Australian networks and is based on benchmarking the costs of these services against those in other countries.’

Meanwhile, in separate but related news, Australia’s communications minister Paul Fletcher has announced the government has agreed to implement the recommendations of the Department of Communications’ Spectrum Review, which was published in May 2015. The state is now planning to: replace current legislative arrangements with new legislation that removes prescriptive process and streamlines licensing; ensure better integration of the management of public sector and broadcasting spectrum; and review spectrum pricing. The government has published a timeline for what it calls the key implementation milestones, with expectation that the new framework will commence from mid-2017.