TPG kept looking into 5G even though Teoh killed the project

Despite saying it was ending its mobile network at the start of the year, TPG's head of operations and products has revealed the telco continued to talk to mobile equipment vendors.

As the case between Vodafone and the Australian Competition and Consumer Commission (ACCC) nears its halfway point, ACCC counsel Michael Hodge QC continued his questioning of TPG's COO Craig Levy. 

During an excruciating period where the details of a scrapped phone plan were picked apart, Levy revealed that a planned AU$10 per month mobile plan on the company's proposed network would have given subscribers 1GB of data per day at the fastest speeds TPG's network could deliver, within its limited footprint.

The money shot was that the first six months of access would be free, allowing TPG to sign on customers and learn about its network performance.

But Levy revealed the mobile plan had been abandoned following TPG's decision to stop its network build, and "community concerns" regarding health issues and the provisioning of antennae in the small cell network. While the equipment was safe according to Levy, the concerns were enough to give Levy pause.

Read more: VHA under the spotlight as ACCC continues merger fight

With Telstra and Optus deploying 5G networks, combined with TPG's initial small footprint and the community concerns, this meant TPG's aspirations of becoming an independent mobile network operator were allegedly stymied. By the end of Levy's cross-examination, it seemed clear that TPG's plans to become a mobile network operator were in tatters by the beginning of this year -- or so it appeared.

Despite having cancelled their network build at CEO David Teoh's direction, TPG's head of operations and products, David Hanly, revealed in court that even though plans for the network were killed off, he had not told his team to stop looking into upgrading the equipment it had already deployed to 5G .

While TPG has been telling one story -- of its mobile network plans being killed off after the banning of Huawei's telco equipment -- the company continued to look into 5G by talking with other mobile equipment vendors.

With Hanly telling the court that his team was still looking into an upgrade to 5G with Ericsson, in addition to being in discussions with Nokia, Hodge QC has painted a picture that suggests the government's banning of Huawei equipment from Australia's mobile networks was less of a problem than previous witnesses have indicated.

The ACCC's case hinges on blocking the merger between TPG and Vodafone so that TPG creates a fourth network, which the competition watchdog believes would increase competition in Australia's mobile markets.  

With the ACCC dropping a late-night affidavit, TPG's counsel Dr Ruth Higgins said the ACCC's case was largely theoretical and the commission was playing whack-a-mole and changing what she called a theoretical case against the merger.

TPG's legal counsel calls ACCC's case "utterly theoretical" 

After almost two weeks of quite technical testimony looking at how mobile networks are designed and built, as well as a dissection of financial models, TPG's counsel Ruth Higgins QC kicked off proceedings with a stinging attack on the ACCC. 

Citing an affidavit from Ericsson that was delivered to TPG at 9:30pm on Tuesday night that significantly changed the solution Ericsson proposed to TPG, Higgins said the changes indicated that the ACCC's case against the proposed merger were "utterly theoretical".

The affidavit changes the context behind some of the evidence given by previous witnesses, which have since been dismissed by the court. Many of the technical details in the affidavit cannot be challenged by witnesses. 

Higgins also noted that a presentation that had not been previously in evidence was added as an exhibit to the ten-page affidavit, calling the changes to the evidence "deeply disappointing", saying the ACCC has failed to do the right thing by revealing information in a pragmatic and timely way.

Justice Middleton, who is presiding over the case, was only made aware of the document a few minutes before court resumed and has said the amiability of the affidavit is a matter he'll consider and rule on.

The case continues.

Updated at 12.40pm AEST, 18 September 2019: added information from Wednesday mornings proceedings

Related Coverage