Vodafone's chilling attempt to monopolise spectrum

Vodafone's campaign to secure the remaining 700MHz spectrum shows it will pay whatever it takes to stall true competition in mobile.

2degrees CEO Stewart Sherriff says Vodafone's public comment this week that the spectrum should be sold to "the party that values it the most" adds to chilling reading in its Commerce Commission application for the scarce resource.

"Vodafone already has more spectrum than anyone else and is seeking to use its market power to gain even more. This is a once in a generation allocation and the outcome will impact the telecommunications market for the next 18 years," says Mr Sherriff. In an industry where the company with the most spectrum enjoys lower infrastructure build and operation costs, Vodafone is seeking to lock-in twice as much spectrum as 2degrees.

Mr Sherriff says Vodafone's October 9 clearance application to the Commerce Commission reveals its plans to ensure 2degrees does not continue to grow, preventing post pay and business customers from getting the value they deserve.

In seeking the remaining 5MHz paired of 700MHz spectrum, Vodafone concludes:

"¿all [operators] can continue to compete on the same basis as at present¿.Vodafone and Telecom would remain in broadly equivalent positions¿and there is no reduction in 2degrees ability to compete on the same basis as it currently does".

Mr Sherriff says these comments are aimed at ensuring 2degrees does not grow, ultimately undermining its ability to become a full service telecommunications provider that challenges Vodafone and Telecom in the fixed and mobile markets.

"We are investing in a national network, growing our customer base and launching new services. We've made it clear we intend to leverage the UFB to compete head on with Vodafone and Telecom in the total telecommunications market."

"Spectrum is the motorway of the industry and you can't give one player twice as many lanes and expect the market to be competitive. It's especially important in rural areas where Vodafone is attempting to create a new monopoly ¿ everyone, everywhere deserves a choice of three."

Mr Sherriff says the government needs to take stock of a complex and changing market, not make a decision based on a lack of information.

"All three players now have sufficient spectrum to deliver 4G services, with Vodafone and Telecom already holding more than 2degrees."

"Even Telecom agrees no one needs the additional spectrum immediately and that the government should not sell it to Vodafone."

"The Minister has commenced a review of the telecommunications market and that needs to play out. The review will reveal the true state of competition in the mobile market and provide information that enables good decision making."

"The unsold spectrum isn't needed right now and the market's changing fast. Let's take the time to get this right."