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Aussie competition regulator opposes the formation of a super-telco

Publication: 
Editorial Staff
chiefofficersnet

The Australian Consumer and Competition Commission (ACCC) has issued a notice opposing a "merger" proposal involving TPG Telecom Limited (TPG) and Vodafone Hutchison Australia Pty Ltd (Vodafone). The reasons include that TPG has been "disruptive" in a complacent market and is "the best prospect Australia has for a new mobile network operator to enter the market." But it's a far more complex picture than that.

The response of Vodafone was, essentially, one of surprise. The deal, it pointed out, would create a combined company. The component parts of that company were not, in any meaningful way, competing to the benefit of consumers. Indeed, TPG's mobile service runs on VHA's tech, it was pointed out. TPG was incensed: "A combination of our companies would create a new, vigorous and vibrant competitive force. Left unchallenged, this decision will only serve to further entrench the enormous power of Telstra and Optus" it said in a statement.

Both companies have said that they intend to take the case to the Federal Court.

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Note: TPG's recent launch in SIN is a 4G LTE service. There is is the fourth carrier and in December last year reached the required threshold of 95% coverage.

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