ICCC authorises Telikom, DataCo merger

The Independent Consumer and Competition Commission has authorised the proposed merger of Telikom PNG Limited and PNG DataCo Limited.

ICCC Commissioner Paulus Ain made the announcement during a media conference yesterday.

The application was jointly lodged on the 05th of April 2017, by Kumul Consolidated Holdings Limited and Telikom.

KCHL also applied for clearance together with the authorization application, but subsequently withdrew it. As a result the review of this authorization application did not proceed until the 30th of January 2018, when KCHL formally advised the ICCC to recommence the assessment of its authorization application.

Commissioner Ain said the proposed merger has been carefully considered consistent with these requirements and it has been conducted through a transparent consultation process.

The ICCC listed the following benefits as per comments from stakeholders during the consultations:

  • Potential for Increased price competition and consequent retail price reduction to end users;
  • Innovation and increased investment in new technology, hence the technical and skills gained by national employees;
  • Improved backhaul networks and greater access to the use of the backhaul networks for retail operators which will benefit the end users of data and voice services;
  • Improved economic activity and efficiency for the parties in the long run;
  • As a result of more aggressive competition in retail service offerings, there will be greater penetration of higher bandwidth data and voice services into smaller towns and rural locations, which is currently enjoyed as a near monopoly by Digicel ( which provides services at a lower bandwidth).

On its consideration of the likely effects on competition, the ICCC knows that there is a real likelihood of the merged entity engaging in discriminatory pricing. However, the ICCC and NICTA have agreed to work together to address this concern by putting appropriate regulatory measures in place.

The ICCC further states the benefits outweigh the detriments thus its authorisation of the merger.

Author: 
Meredith Kuusa