Aus mobile networks are competitive: Sims

Vodafone's dreams for additional government regulation in the mobile space have been given a hard blow by new ACCC comments.

In contrast to comments made by Vodafone Hutchison Australia's (VHA) new CEO Bill Morrow, Australian Competition and Consumer Commission (ACCC) chairman Rod Sims has said that Australia's mobile networks are very competitive.

Late last month, when announcing that Vodafone had lost 178,000 customers and reported a loss of AU$260.2 million for the first six months of 2012 , Morrow said that the government needs to step in with greater regulation of the mobile industry.

"We are going to be looking for the government to be somewhat sympathetic with us and help us, from a regulatory point of view, of making sure that they keep competition here in Australia," he said.

"Telstra is a great company, and [CEO David Thodey] is doing a nice job there, but they have had an advantage, they have had some regulatory favour and I think it's important that the consumer have choice, and we're going to be looking to the government to see if there isn't something else that can be done to balance that out in a little bit of a better way."

But in a speech to the Independent Pricing and Regulatory Tribunal in Sydney today, Sims said that the "greatest success" in fostering competition in the telecommunications industry has been achieved by the mobile networks.

"Perhaps the greatest success has been in relation to mobile services, where the relatively lower cost of network roll-out (compared to fixed-line networks) has led to greater infrastructure competition," he said. "The functionality of mobile phones and internet connections have improved significantly."

Sims said that there are more services and capacity on mobile networks, and that competition between the providers offers good services to customers.

"The competition between network operators and the high levels of demand from consumers has created incentives for them to expand coverage, upgrade to more capable networks and more generally increase the availability of services," he said. "Better still, competition has emerged without the need for much regulatory intervention — this is certainly a preferred option for the ACCC."

Telstra announced yesterday that it now has 13.8 million mobile customers; more than double the 6.8 million mobile customers that Vodafone has. Optus is expected to reveal its customer numbers in its financial results announcement on Tuesday.


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