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Competition watchdog eyes mobile termination rates

The Australian Competition and Consumer Commission is questioning whether it needs to continue to regulate the charges that mobile telecommunications companies impose on each other for calls made between competing mobile networks.
Written by Josh Taylor, Contributor

The Australian Competition and Consumer Commission (ACCC) has launched an inquiry into the Mobile Terminating Access Services (MTAS), which regulates how the mobile telecommunications companies charge each other for calls made from one network to another.

The ACCC regulates this service to ensure that the larger telcos do not overcharge smaller telcos, or prevent those telcos from connecting calls to their network entirely. Following a review in 2009, the declaration of this service was extended to June 2014.

But given the rise of over-the-top players like Skype, where voice calls are made over data, and the rollout of 4G long-term evolution (LTE) networks by Telstra, Optus, and Vodafone, which will eventually see all voice calls made over data, the ACCC has questioned whether MTAS still needs to be a declared service.

The regulator has sought the views of the industry on whether MTAS still needs to be a declared service, as well as if it should be extended to LTE services and other parts of the mobile network interoperability, including SMS.

The ACCC has also questioned whether voice calls made on the National Broadband Network (NBN) would need to be considered as part of any new MTAS declaration, given that the calls would also be delivered over IP.

ACCC chairman Rod Sims said that the review would look at how much the industry has changed since the last review in 2009.

"Network quality and performance have become important considerations for consumers choosing a mobile provider. This inquiry will examine the impact of changes to the wholesale termination services, and whether regulation is needed to ensure that consumers can connect with other networks," he said in a statement.

The telcos have been staunch defenders of mobile termination rates in the past. In 2011, despite objections from Optus and Vodafone, the ACCC lowered the MTAS charge from 9 cents to 6 cents per minute. Optus and Vodafone have each said since the change that the decision to reduce the charge has had significant negative impact on their profits.

Telstra, Optus, and Vodafone have been approached for comment.

Submissions for the inquiry will be accepted until July 5, 2013.

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