Telstra Speaks Out Against Domestic Roaming
At the launch of its 100th mobile base station under the government’s Mobile Black Spot Program, Telstra has claimed that its involvement in the program would be at risk if domestic mobile roaming is declared.
Repeating previous statements by the company against other networks ‘piggybacking’ its network in rural areas, Telstra CEO Andrew Penn said the telco could not commit to additional co-funding in the program unless the ACCC decides to not declare mobile roaming.
“Roaming is not the model to solve coverage. If you implement roaming, that will, I think, undermine the black spots program,” Penn told The Australian Financial Review.
Telstra has already committed $229 million to building a total of 577 base stations in the first two rounds of the Mobile Black Spot Program, compared to $22 million worth of investment by Vodafone in both rounds and a $36.4 million by Optus in the second round. Additional contributions from the state and federal governments bring the total funding to almost $600 million.
In a report earlier this week by The Australian, a Goldman Sachs analyst claimed that declaring domestic roaming would plunge Telstra’s earnings down by $546 million in the 2018 financial year, despite payments from competitors Telstra would receive for their usage.
“The loss of price premium has a much more material impact on earnings, given lost subscriber earnings are partly offset by additional wholesale earnings,” Goldman Sachs analyst Kane Hannan said in a note to clients.
The ACCC is expected to make its decision on domestic mobile roaming by April.