Shadow Communications Minister Malcolm Turnbull has accused Communications Minister Stephen Conroy of attempting to squeeze every cent out of mobile telecommunications providers in upcoming spectrum licence renewal negotiations.
In a blog post, Turnbull cited a report in today's Australian Financial Review that said the government has given mobile phone operators until early next year to commit to paying billions of dollars for licence renewals or face bidding for the spectrum at an auction.
"There is a legitimate debate about how the renewal fees should be calculated and concern expressed by the industry that if the prices are set too high it will inhibit carriers in making the investments to deliver new wireless broadband services," Turnbull wrote. "Wireless spectrum is a scarce resource and of course governments should aim to allocate it in a way that maximises the return to the taxpayer."
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Turnbull said that after passing telecommunications reform legislation and "ensuring there is no fixed-line competition" to the National Broadband Network (NBN), Conroy was attempting to make wireless a less competitive alternative.
"So from his distorted and confused perspective, squeezing the last dollar out of the wireless operators is no bad thing — the more they pay the government for spectrum, the more they will have to charge their customers and the less competitive wireless broadband will be with the NBN."
Turnbull's concerns were echoed in a recent report commissioned by the Australian Mobile Telecommunications Association. The report was authored by United Kingdom Apex economics expert Dr Chris Doyle who urged the government to consider "conservative" pricing for spectrum renewal or risk higher prices and reduced infrastructure investment.
"However, there is a worry in the current fiscal climate that government may be tempted to set a fee at the higher end of estimates. This would run the risk of inefficiency by causing scaled-back investment and higher customer prices for mobile services," Doyle said. "The knock-on effect would pose a serious risk to digital productivity objectives."