ACCC commences inquiry into regulation of wholesale mobile voice and SMS services

The ACCC has today commenced a public inquiry to decide whether to extend, vary or revoke the domestic mobile terminating access service (MTAS) declaration, or whether to make a new declaration.

The MTAS is a wholesale service that allows consumers on different mobile networks to make calls or send SMS to each other. The ACCC regulates the MTAS to ensure that calls can be made between consumers on all mobile phone networks.

The Australian mobile industry has changed significantly even since 2014 when the current declaration was made.

Changes include the increase in the use of ‘over-the-top’ services such as WhatsApp, Messenger or Skype, and the introduction of Voice over Long Term Evolution (VoLTE) and Voice over WiFi (VoWiFI) calling by all mobile networks

The public inquiry will assist the ACCC to determine whether the MTAS should remain a ‘declared’, or regulated, service.

“Increasingly, consumers are choosing over-the-top services to make calls and send messages. 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,” ACCC Commissioner Cristina Cifuentes said.

“Regulation of wholesale mobile termination has, in the past, helped to lower retail prices for mobile services for the benefit of consumers. This inquiry will consider whether continued regulation is needed to deliver this result.”

“Given the pace of technological change in mobile networks, the ACCC will seek to determine whether the service description remains fit-for-purpose and accurate. We also intend to test what effect the declaration of SMS services in 2014 has had on relevant markets, in particular its impact on consumers,” Ms Cifuentes said.

The discussion paper is available at: Mobile terminating access service declaration review – 2018

Background

The Competition and Consumer Act 2010 requires the ACCC to review the current MTAS declaration in the 18 months before it expires on 30 June 2019.

MTAS is a wholesale service which mobile network operators offer each other so that voice calls and SMS originated on different networks can be connected. It is provided by a mobile network operator to connect or ‘terminate’ a call or SMS on its network. The network originating the call (whether fixed or mobile) pays the network receiving the call or SMS for the MTAS.

The originating network recovers the costs of the MTAS in the retail price it charges its customers for providing the call.

Submissions are invited by 14 September 2018.

A draft decision is expected to be issued for public consultation before a final decision is announced.

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