Australia's competition watchdog begins informal review of TPG-Optus deal

ACCC Opens Review of TPG-Optus Network Sharing Deal

The Australian Competition and Consumer Commission (ACCC) has initiated an informal review of a network sharing agreement between TPG Telecom and Optus, a subsidiary of Singapore Telecommunications. This move comes under scrutiny as the watchdog examines the potential effects of this collaboration on both pricing and non-pricing aspects within Australia's mobile service infrastructure.

Under the terms of this agreement, first inked in April, TPG Telecom plans to significantly expand its regional coverage. The deal will see TPG increase its mobile network sites from 755 to 2,444 across regional Australia. Moreover, TPG will gain access to Optus' regional 5G network as it continues to be deployed.

One of the key financial aspects of this arrangement involves TPG avoiding substantial operating and capital expenses related to the maintenance and expansion of its regional network infrastructure. As part of the agreement, TPG is set to pay Optus A$1.17 billion ($791.39 million) over the span of 11 years.

This review comes in the wake of a previous decision in 2023, wherein both the ACCC and the Australian Competition Tribunal blocked a similar asset swap between TPG and larger telecom rival Telstra. The rejection was based on concerns over competition and the potential impact such a deal could have on Optus.

"In this arrangement, we have taken account of learnings during a similar process in 2023 and will work collaboratively with the ACCC throughout this approval process," stated a TPG spokesperson in an emailed response.

An Optus representative also acknowledged the ongoing review and expressed their commitment to cooperate with the ACCC, providing any necessary information for the evaluation. The deadline for submitting views to the regulator on this deal is set for July 26, with the ACCC slated to disclose its findings by September 13.