The decision on the rate for receiving SMSs maintains the rate proposed in the ACCC’s draft decision in May and is based on the network capacity and equipment used to carry SMS messages on Australian networks.
The ACCC says the rate of 0.03 cents is well below current commercial rates for SMS termination.
As well as setting a price on receipt of SMS messages for the first time, the ACCC today released its final decision on the wholesale price that mobile network operators should charge each other and fixed-line network operators for receiving calls on their mobile network – confirming the rate at 1.7 cents per minute, reduced from the current rate of 3.6 cents per minute.
“The ACCC does not regulate retail charges, either for mobile calls or SMS, but expects these savings from these two decisions will be passed onto consumers either by way of lower charges or through improved call and SMS inclusions in retail plans,” ACCC Commissioner Cristina Cifuentes said.
“The final regulated rates reflect the costs of terminating calls and SMS messages on Australian networks and is based on benchmarking the costs of these services against those in other countries,” Ms Cifuentes said.
“In Australia, the majority of mobile calls and SMS are carried on 3G networks, which are more efficient than the 2G networks which are used to a larger extent overseas. The mobile networks in Australia also carry a much larger amount of data traffic than overseas networks. These features reduce the cost of terminating calls on Australian networks and have been taken into account in the decision.”
The ACCC says voice over 4G technology (voice over long term evolution (VoLTE)) is also expected to reduce the costs of terminating mobile calls and SMS messages and that, voice over 4G has not yet been commercially rolled out in Australia and “its actual impact on the costs of terminating calls and SMS is uncertain”.
“The ACCC will monitor the planned roll out of voice over 4G technology, which could be as soon as later this year. If there is evidence of voice over 4G take-up which affects the costs of terminating calls on Australian networks, the ACCC may review the regulated rates,” Cifuentes said.
The regulated prices for both mobile voice and SMS termination announced today will apply from 1 January 2016 to 30 June 2019, and the ACCC has released a revised report from WIK-Consult detailing the international benchmarking study undertaken to inform the regulated prices.