ACCC may drop regulation of wholesale mobile voice/SMS

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The Australian Competition and Consumer Commission (ACCC) says it has 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 altogether.

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 OTT services such as WhatsApp, Messenger or Skype, and the introduction of VoLTE and VoWiFI calling by all mobile networks in Australia.

The goal of the public inquiry is to determine whether the MTAS should remain a ‘declared’, or regulated, service, said ACCC Commissioner Cristina Cifuentes.

“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,” 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 seeks to determine whether the service description remains fit-for-purpose and accurate, she added. “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.”

The discussion paper is available here. Submissions are invited by September 14, 2018.

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.

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