The Australian telecommunications industry is set for a shakeup with the announcement of a major network sharing agreement between Optus and TPG Telecom.
This deal will significantly expand TPG’s mobile network coverage and accelerate Optus’s 5G rollout in regional areas, potentially posing a significant challenge to the dominance of Telstra.
Boosting Regional Coverage
Under the terms of the agreement, TPG Telecom will gain access to Optus’s mobile network infrastructure, extending its coverage from 400,000 square kilometers to a whopping 1 million square kilometers.
This is a significant boost for TPG, which has historically had a limited mobile network footprint.
The expanded coverage will allow TPG to offer its mobile services to a much larger portion of the Australian population, particularly in regional and rural areas.
Accelerating 5G Rollout
The agreement also benefits Optus by allowing them to leverage TPG’s infrastructure to accelerate the rollout of its 5G network in regional areas.
This is a strategic move for Optus, as 5G is expected to be a major driver of growth in the mobile telecommunications market in the coming years.
By expanding its 5G reach, Optus will be better positioned to compete with Telstra, which has already begun its national 5G rollout.
Ramifications For Telstra
The Optus-TPG network sharing agreement is likely to have a significant impact on Telstra, the current leader in the Australian mobile market.
Telstra has long enjoyed a competitive advantage due to its extensive network coverage, including strong regional presence.
However, the expanded TPG network and Optus’s accelerated 5G rollout could chip away at Telstra’s market share, particularly in regional areas.
The deal is expected to commence in 2025, which does give Telstra time, to create better value plans for regional customers, in an attempt to lock down the marketshare.
Benefits for Consumers
Ultimately, the Optus-TPG network sharing agreement is likely to benefit Australian consumers by increasing competition in the mobile market.
This could lead to lower prices, improved service quality, and a wider range of mobile data plans for consumers to choose from.
For far too long, regional Australia customers have been locked in to Telstra with no other alternatives.
With this merger, regional Australian customers will now have the cheaper prices that metro Australia typically receive, due to the competition.
Additionally, the expansion of mobile network coverage and the acceleration of 5G rollout in regional areas will provide residents of those areas with better access to mobile services and the benefits that come with them.
This means customers who have been stuck on regional services such as Satellite, may be able to get 5G Home Broadband as a new alternative.
If we’re talking about pure price, TPG plans at times, are 50% cheaper than general Telstra Plans.
Telstra Mobile Plans commence at $62 per month and they have upped prices in recent times, with plan prices potentially rising annually, which they put down to CPI.
On the other hand, TPG Mobile Plans start at $20 per month and go up to $40 per month. Optus plans commence from $49 per month, both cheaper than Telstra.
Looking Ahead
The Optus-TPG network sharing agreement is a significant development in the Australian telecommunications industry.
It remains to be seen how Telstra will respond to this challenge, but one thing is certain: the Australian mobile market is about to become more competitive, which is ultimately good news for consumers in rural Australia.
