Telecommunications and IT company TPG has announced today in a statement to the Australian Stock Exchange (ASX) their intention to build a mobile network in Australia.
The network would use current advanced technology and be worth $1.9 billion, using a license for 700MHz spectrum to be purchased in addition to their existing spectrum in the 2.5GHz and 1800MHz range. The 700MHz spectrum license includes 2x 10MHz spectrum blocks in the 700MHz band with the licenses going live from the 1st of April 2018, and expiring on the 31st of December 2029.
The TPG mobile network would reach 80% of the Australian population, being built over the next three years. TPG intends to roll out between 2,000-2,500 mobile sites, as well as small cell sites as part of the rollout.
CEO of TPG,David Teoh said of the acquisition of the spectrum:
This acquisition of 700MHz spectrum in Australia is a tremendous development for the long-term future of TPG. We are uniquely positioned to leverage our success in the Australian fixed-line broadband market to drive the next phase of growth for TPG’s shareholders and bring new competition to the Australian mobile market,
The announcement of the TPG acquisition of licenses for blocks in the 700MHz spectrum comes on the same day as Vodafone announced their acquisition of 2x 5MHz blocks of 700MHz spectrum.
TPG currently offers mobile offerings through an MVNO relationship with OptusVodafone to offer 4G mobile service. This move to their own network would allow TPG more options.
In terms of sustainability, TPG says they expect to reach breakeven earnings before interest, tax, depreciation and amortization (EBITDA) from their network with only 500K subscribers – a market share of ~2%.
TPG will begin trials next year, before the full rollout. It’s an interesting move, and well, more competition is always good.
Will you try out TPG’s network?
I would think they are likely to offer some very good deals but have the same terrible service and no actual speed to offer due to way over subscribing. So I would probably stay away from them unless they can prove they can offer something decent which I very much doubt.
Why didn’t TPG just buy or merge with Vodafone and extend its coverage.
Giving Vodafone a fixed Internet market and TPG a mobile network. I
doubt this will have much of an impact now as Telstra has more than 50%
of the NBN connections (remember people get a discount for Intenet and
mobile together) and TPG has no real brand presence or trust so most
people will be warry of using them unless they offer way lower prices
and then can’t get the money back from building the network.
good point! having three power players (telstra,VodaTPG and to a lesser extent,Optus) would be great for shaving a buck off the odd Telstra mobile deal
No thanks! In the past 18 months Vodafail’s customer service levels have fallen into a hole as all it’s resources have been shifted into fixing the network which is now good/great. The last thing those of us stuck on contracts at VFAU need is TPG’s “Customer Service Kiss of Death”.
Competition is what has brought my Telstra plan down in price and extra value. TPG doing this would be so that they can offer better quota plans on there network and pull in other telco customers. Add in broadband bundles then they have a good shot at it, provided they have enough bandwidth.
Currently 70% of Australians live in Capital cities. Throw in some regional cities, and you have 80%. That is an insanely small network for a huge country like Australia. TPG had better have some roaming agreements, or you’ll be out of luck if you travel anywhere apart from major cities.
Good for numbers, but yes travel may be an issue. They’ll have some sort of roaming agreement you’d hope.
I believe TPG have an ownership share in Vodafone (hence the shift from Optus to Voda) so you’d imagine they’d continue to leverage off their network for roaming purposes.
I thought TPG uses Vodafone not Optus.
Yep, you’re right. They used to be Optus, but moved to Vodafone. Updated.