The planned network sharing agreement between Telstra and TPG Telecom has been stopped by Australia’s competition authority.
The telcos’ flurry of late filings failed to persuade the ACCC that the agreement would benefit customers and have no negative effects.
In February, Telstra and TPG Telecom made a proposal to potentially share airwaves and cellular infrastructure for decades in remote Australia.
The proposed arrangements were thoroughly investigated, according to ACCC commissioner Liza Carver.
While there are some advantages, in our opinion, the proposed arrangements would probably result in less competition over time and worsen the situation for Australian mobile subscribers in terms of price and regional coverage.
The sharing of spectrum and mobile infrastructure by Telstra and TPG in rural Australia, according to Carver, would “significantly disrupt the market’s structure and have long-term effects.”
The parties had hoped that the ACCC would approve the transaction due to a number of concessions made throughout its assessment, including the right to veto it after eight years.
Nevertheless, the ACCC openly discussed potential alternatives to an agreement with Telstra that TPG Telecom might explore throughout that review time.
The possibility that TPG Telecom and Optus may agree to share some network assets was one strategy used to put doubt on the Telstra-TPG alliance.
An agreement with TPG Telecom was referred to as “a real commercial likelihood” by Optus, which is attempting to have the Telstra-TPG transaction stopped.
Days later, it was discovered that a deal with Optus had previously been pursued but that the parties were unable to come to terms. TPG Telecom had first deemed it “unlikely.”
