IT and telecommunications provider Inabox Group is making the most of its access to Telstra’s 4G network to inject a dose of competition in the telco market, with company CEO Damian Kay warning that further regulatory intervention in this space needs to be carefully thought through.
With Vodafone Australia and the Australian Competition & Consumer Commission at loggerheads on the domestic mobile roaming issue, Mr Kay said regulating the market was not a cut and dried affair.
“Did the ACCC assess the market correctly? From a purely competitive perspective I don’t think they did a great job and we have seen it before when they last year assessed the 121 point of interconnect (PoI) decision for the NBN and said that it didn’t hurt competition,” Mr Kay told The Australian.
“That was completely wrong. The regulator had all the proof and we know that only Telstra, Optus, TPG and Vocus can build into the 121 points, so how is that competitive?”
Telcoinabox has to rely on the big four telcos to address the needs of its NBN customers and Mr Kay said it was a complexity that together with high NBN wholesale prices was damaging the quality of NBN services delivered to customers.
“On NBN we are reliant on the upstream providers and if we have a customer that’s willing to pay an extra $20 to get a higher speed service, well we can’t provide that because of the 121 PoIs,” he said.
“We have thousands of customers, but we can’t provide them any details on the kind of service they get because we don’t have the data.”
On the mobile roaming front, Mr Kay is more charitable towards the ACCC, saying there’s considerable merit in taking long-term investment into account.
“If you take away one of the key reasons for Telstra to invest in greater coverage then those with poor coverage today will continue to get poor coverage in the future,” he said.
Vodafone in its latest submission to the ACCC has stated that domestic roaming could deliver up to $650 million in benefits. It is also taking the regulator to court, contesting the manner in which it had defined a specific domestic roaming service for its inquiry.
The other important consideration, according to Mr Kay, is that there is still a competitive spark to the mobile market, especially when mobile virtual network operators (MVNOs) are taken into account.
“I think the ACCC should just stay out of the mobile market, where competition is alive and well,” he said.
Telcoinabox was the first aggregator to launch Telstra Wholesale 4G network in August last year and has signed up a record 27 new retail service providers (RSPs) in the past five months.
It is a diverse bunch of RSPs, from the FiftyUpClub — a mobile and NBN provider to the over-50s demographic — to iNTTN — a telco focused on providing indigenous Australians with competitively priced telecommunications and IT services.
Mr Kay said that there was also a clear push by traditional IT and hardware service providers to develop a comprehensive telco offering.
“We are seeing record interest in from large consumer brands wanting to become telcos and from managed services providers,” he said.
A good example of this is West Australian outfit Commandacom, which has been providing technology and hardware services for more than two decades, but has signed up with Telcoinabox to spruce up its telco offering.
“Right now, customers buy their services (cloud, connectivity, IP Voice) from multiple providers and when something goes wrong there’s no clarity on where things have gone wrong,” Mr Kay said.
“The convergence of technology where all the services can sit on top of a network means that service providers are looking for a converged solution.”
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