Telstra and TPG Telecom’s planned network sharing arrangement has been blocked.

Australia’s competition watchdog, the ACCC, says it has not been convinced that the proposed arrangement would benefit customers, and would not create adverse impacts.

In early 2021, Telstra and TPG Telecom proposed sharing spectrum and cellular infrastructure in regional Australia, potentially for decades.

The plans went up for review by the ACCC, which is not allowed to grant authorisation unless it is satisfied the proposed arrangements would not be likely to substantially lessen competition, or that the likely public benefits from the arrangements would outweigh the likely public detriments.

The ACCC now says it was not satisfied under either of these tests and therefore cannot grant authorisation.

“We examined the proposed arrangements in considerable detail. While there are some benefits, it is our view that the proposed arrangements will likely lead to less competition in the longer term and leave Australian mobile users worse off over time, in terms of price and regional coverage,” ACCC Commissioner Liza Carver said.  

“Mobile networks are of critical importance to many aspects of our lives, including our livelihood, our wellbeing and our ability to keep in touch with friends and family. Any reduction in competition will have very wide-ranging impacts on customers, including higher prices and reduced quality and coverage,” Ms Carver said. 

“Mobile network operators compete on price and a user’s package inclusions, but importantly, they also compete on coverage, speed and other quality dimensions that are directly influenced by the nature and extent of their underlying network infrastructure,”

“Entering into the arrangements proposed by Telstra and TPG will represent a significant change to the structure of the market that would have long-term consequences.”

However, the key reasons for the decision remain shrouded in mystery, as the full list of reasons has only been made public with significant redactions.