Telstra, Optus, TPG say UOMO devised with unrealistic expectations

Telstra, Optus and TPG have told parliament that the federal government’s new universal mobile service obligation (UOMO) bill is built on unrealistic expectations about the maturity and commercial availability of satellite-to-mobile (STM) technology needed to meet its requirements.

The bill, which places an onus on them and rival mobile network operator Optus to provide competitive voice and text services over 5 million square kilometres of the Australia, including 37,000 kilometres of road, is scheduled to commence December 2027.

But all three carriers broadly agreed that the capability to use the technology for carrier-grade mobile service, particularly for emergency voice calls, won’t be available until late 2028 at the earliest.

Optus’ newly-appointed chief technology officer Sri Amirthalingam told a senate committee that the technical, commercial and regulatory requirements needed to meet the UOMO obligations “safely and in a sustainable fashion” would not be in place by the time of the bill’s default commencement date.

Telstra legal and regulatory executive Bill Gallagher told the committee that the bill should not commence until both the low earth orbit (LEO) satellite constellations and handsets needed to run satellite-to-mobile services are available and on commercially viable terms.

“In this regard we would like to make three recommendations: first, we propose the bill's default commencement date of December 1, 2027 be removed and instead that commencement be initiated by the decision of the minister based on the availability of required technology and compatible devices for voice and messaging, something that will only be will only be known closer to the time,” Gallagher said.

TPG Telecom’s chief technology officer Giovanni Chiarelli also told the committee that the carrier faced a range of technical hurdles establishing satellite-to-mobile services.

He said that TPG Telecom lacked spectrum rights compatible with LEO satellite services like SpaceX’s Starlink constellation and for associated ground stations, the latter of which would need planning lead times to establish.

He also said that the UOMO bill would not work until a critical mass of compatible handsets were available in the market.

“Starting before then risks confusion and poor user experience, including in public safety situations. Taking together the timing of a UOMO compliant service will be driven by a chain of dependencies that primary providers cannot simply choose or accelerate, our preferred approach is for the minister to set the start date by notifiable instrument once clear and transparent criteria are met,” Chiarelli said.

“If a default date remains, it should be no earlier than January 1 2030,” he added.

Reinforcing his argument, Chiarelli said that AST SpaceMobile, Lynk and Amazon Leo had all announced plans to offer satellite-to-mobile services, but that they wouldn’t be available until after 2027.

Optus did not directly tell the committee it had a preference for the bill to commence by ministerial direction, but Amirthalingam said that “having a rigid timeline, without any control of the technology, is not realistic.”

He told the committee that establishing earth stations in Australia was “trivial engineering” but that “that's not the key piece of the technology”.

“Any legislation that actually enforces obligations on the operators is not very effective because we don't control any of that … I think the question that we need to think about is how you set some realistic deadlines to ensure that we collaboratively bring in some kind of technology,” he said.

Optus’ rivals expressed similar concerns.

TPG’s Chiarelli said that the bill placed undue commercial pressure on the carrier to enter a deal with a LEO satellite provider such as Starlink.

“In essence, it would be like putting a gun [to] our head in order to have a deal, a sort of take or leave approach that will be made will make the satellite technology, probably, sub-optimal in terms of technical choices and definitely more challenging in terms of effectiveness and efficiency from an economical perspective,” he argued.

Telstra's Gallagher also said that there was a need to ensure that market competition was sufficient at both satellite and mobile network operator levels to deliver affordable pricing to consumers.

“Affordable outcomes, we believe, are best delivered through competition, so we believe UOMO policy objectives will best be served by ensuring there's competition at the satellite operator level and amongst mobile network operators,” he said.

Optus also warned of a potential “price squeeze” impacting consumers if competition in the LEO satellite market was not sufficiently mature at the commencement of the bill.

However, SpaceX vice president of satellite policy, David Goldman, told the committee that gouging mobile operators on pricing did not make commercial sense for the company.

“The best service for us is for as many Australians as possible to be on our system – that’s our best monetisation.

"It would not be in our interest to try to gouge because then that would actually undermine what  actually our best market position would be,” Goldman said.