The Australian Competition and Consumer Commission (ACCC) has launched an inquiry into whether it should continue regulating mobile voice and SMS termination.
At the moment the ACCC sets the default pricing that a mobile network operator can charge another telco when customers make a call or send an SMS message to one of the MNO’s subscribers.
The regulation has historically been necessary because each MNO effectively has a monopoly when it comes to accessing its customers, the ACCC believes.
The ACCC first declared the Domestic Mobile Terminating Access Service (MTAS) in 1997 — regulating voice call termination charges on Australia’s first mobile networks. In 2014, MTAS was expanded to include SMS messages.
The commission’s 2014 decision said that telcos had an “incentive to deny, or set unreasonable terms of access to these termination services in the absence of declaration.” (“Declaring” a service is the ACCC’s mechanism for regulating a service.)
Unless the ACCC decides otherwise, the current MTAS declaration will lapse on 30 June 2019.
“Increasingly, consumers are choosing over-the-top services to make calls and send messages,” ACCC commissioner Cristina Cifuentes said in a statement.
“These fall outside the MTAS service description and we are interested in knowing whether the ability of consumers to choose these ways of communicating means that declaration of the MTAS is no longer necessary.”
An ACCC discussion paper issued as part of the inquiry states that OTT services “are not yet considered to constitute a full substitute for voice services” and that the competition watchdog has not “seen any basis for regulating the originating or terminating functions of OTT services”.
In submissions to the ACCC’s Communications Sector Market Study, Telstra and TPG indicated that they believed there was less need for SMS termination regulations, while Macquarie Telecom, Vodafone and MessageMedia supported continuing ongoing regulation.
“The entry of OTT voice and messaging services has provided some competitive pressure on traditional fixed and mobile voice and messaging services by providing consumers with a low cost alternative, and likely influenced the movement towards unlimited call and message inclusions for relevant services,” said the Communications Sector Market Study final report, which was released in April.