TPGs decision to cease its mobile rollout reduces the prospects for a 4th mobile operator in Australia
The MVNO market is highly competitive in metro regions and looks set to become stronger
We expect the ACCC to turn its focus on the ongoing competitiveness of the MVNO market
On 29th January 2019, TPG announced that it had ceased the rollout of its mobile network due to the ban of Huawei equipment in 5G networks. While TPG’s network is currently 4G, the company has stated that “the design of TPG’s network was that there was a simple upgrade path to 5G”, meaning that any potential ban on its 5G supply would affect its current rollout. TPG has been using Huawei for its current small cell network, which has already 900 small cells fully or partially rollout, as these contracts were signed before the government ban on Huawei in August 2018.
To date, TPG has spent $100 million in CAPEX and committed another $30 million to roll out its network, with equipment for 1500 sites already purchased. These costs are part of a $600 million CAPEX budget for its entire mobile network. This excludes the $1.2 billion TPG paid for spectrum in April 2017 which was initially supposed to support their envisioned mobile build, previously planned for a late 2018 launch. TPG has not announced what its plans are for its existing spectrum holdings and network.