What has changed?
Notable shifts in ownership structures means carriers no longer own or operate their own towers. This has disrupted the long-standing basis for regulation of these facilities. We have already seen some change in laws in response to this evolution, and we anticipate further regulatory reform, as the law keeps pace with further change in the industry landscape.
Further reform on the cards: ACCC’s Regional mobile infrastructure inquiry
In March this year, the Australian Government announced it had directed the ACCC to conduct an inquiry into:
- regional towers used to supply mobile telecommunications and other radiocommunications services; and
- the feasibility of providing mobile roaming during emergencies, including natural disasters.
Process
The ACCC is required to commence the inquiry no later than 1 July 2022 and must report to the Minister within 12 months. We expect the following process will likely apply:
Content
This review is broad in nature. However, the government has been at pains to note that this will not be an inquiry into domestic mobile roaming generally, and the ACCC seems to have heeded this message stating ‘We don’t currently see a need to reprosecute the arguments for and against broader domestic roaming’.
The review is expected to consider:
- the costs of providing towers and associated infrastructure, including land access;
- how these costs translate into the pricing structures for access seekers providing mobile and other wireless services;
- what factors determine investment in towers and improve mobile coverage;
- the technical feasibility of providing roaming during natural disasters or other emergencies;
- the kinds of business systems and processes that will be required and the associated time and cost involved to provide roaming during natural disasters or other emergencies;
- the effectiveness of current commercial and regulatory arrangements in enabling third party telecommunications providers and other likely users to access towers and associated infrastructure; and
- any implications for the provision of access to towers and associated infrastructure of mobile carriers divesting their tower and associated infrastructure businesses (such as price and non-price terms of access).
Of particular interest to non-telco businesses are the indications the review will consider imposing access obligations on structures that do not already have radiocommunications equipment installed on them. For example, the Ministerial Direction expressly requires the ACCC to consult with “providers of other infrastructure that could similarly be used in supplying mobile telecommunications and other radiocommunications services”, and “towers” is defined to include NBN towers, radio and television broadcasting towers and other suitable towers or similar structures that could be used to improve mobile coverage.
Commissioner Peter Crone has also indicated that the inquiry may also assess whether updates are needed to the Facilities Access Code. The Code currently applies to telecommunications towers and underground facilities, like ducts and pits.
While the ACCC is required to report its findings, the Government is not seeking recommendations from the ACCC.
Further information about the ACCC’s inquiry is available here.
Corporate control percentage
Our previous Alert flagged the ACCC consultation into an appropriate corporate control percentage in the context of the expanded facilities access regime. The submissions from industry received by the ACCC do not indicate a lot of consensus about whether the threshold should be low or high:
The ACCC is expected to provide its recommendation to the Minister in June. The Minister will then decide whether to change the threshold from the current default 15%. The expanded facilities access regime will then commence 60 days after the ACCC’s report is provided to the Minister.
Further information about the ACCC’s consultation is available here.
What next?
We expect the regulation of access to telecommunications towers and facilities to continue to change to keep pace with significant shifts in the ownership of these telecommunications assets.
Specifically, the new regime for access to non-carrier-owned or operated facilities will come into play and, depending on the outcome of the ACCC public inquiry, there could be further reform in areas like access to regional towers and possible changes to the Facilities Access Code. There could even be a move to regulate facilities that don’t currently host radiocommunications equipment, but might be suitable to do so.
Regulatory bodies will also continue to keep a close eye on the market as it continues to shift, and potential reforms can be expected to align with the public policy objective of preventing companies from restructuring to avoid regulation and ensuring bottleneck telecommunications infrastructure remain available to access seekers.
You should continue to keep an eye on developments changing the regulation of telecommunications towers and facilities to see what this means for your assets.
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