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The Advertiser
9 hours ago
- Business
- The Advertiser
How one decision could see us shortchanged on billions
The federal budget is under pressure, the global economic outlook is volatile and cost-of-living pressures continue to hammer Australian families. And yet the communications regulator is proposing the federal government adopt a policy that could forgo up to $3.2 billion in revenue. The approach would also reduce competition among telecommunications providers and hamper the introduction of new technologies. It all revolves around how the federal government approaches telecommunications spectrum licenses. Some 69 existing spectrum licenses across seven bands are due to expire between 2028 and 2032, 48 of which are held by three mobile network operators. Spectrum is a valuable public resource. It must be managed carefully to ensure the proper functioning of commercial, government, military and emergency communications - everything from mobile phones, to radios, to televisions, to satellites, to submarines utilise spectrum to communicate. It is the job of the regulator, the Australian Communications and Media Authority (ACMA), to assign spectrum. However, their approach to this issue is baffling and potentially costly. ACMA plans to renew expiring mobile spectrum licenses without a competitive auction, a decision that risks forfeiting between $2 billion and $3.2 billion in public revenue over the coming years. The cost has been estimated in independent economic analysis by Professor Richard Holden, Scientia Professor of Economics at UNSW Business School and editor of the Journal of Law and Economics. Professor Holden says the failure to hold a competitive auction for spectrum is "based on flawed economic reasoning (and) may significantly undermine public trust, market competition, and the integrity of the regulatory process". In his independent analysis, commissioned by ACCAN, Professor Holden argues that by granting renewed access to existing telcos without testing the market through an auction, ACMA risks entrenching incumbent dominance, limiting opportunities for new entrants, and failing to ensure fair market value for a critical public resource. Remember, this is a public resource that ACMA must manage in the best interest of the Australian people. You don't need to be an expert to understand that if you have an asset that multiple parties want to purchase, it makes sense to have a competitive process for its sale. Many of us act on this logic when we put our homes up for auction or other competitive sales approaches. The failure of the regulator, ACMA, to understand this is bewildering. One can only conclude that ACMA is more concerned about the welfare of the industry rather than the impact this proposal will have on the Australian public. As Professor Holden points out, if this proposed approach proceeds, it will likely be presented as "a textbook case of regulatory capture". Of course, it is not the first time this question as been asked. In January this year, the ABC cast doubt on the independence of ACMA over its practice of sharing press releases in advance of public dissemination with companies about whom it had taken regulatory action after an in-depth investigation. The ABC has also criticised ACMA as a "watch poodle" in regard to its enforcement of decently standards in the Radio Code in a Media Watch segment in 2024. Not only did the chair of ACMA seem unable to provide a straight answer about content suitability in front of the Senate - but the quantum of the fines it doled out was appropriately criticised as a "slap on the wrist". And yet, this is a time when we need a strong regulator to protect the public interest more than ever. Trust in our major telcos is brittle. Our research shows that 41 per cent of consumers have limited faith in their telco to act in their best interest -and almost a third said the coverage they received didn't match what they were told to expect. The latest Morgan Poll placed the telcos just behind the major supermarkets in public trust. This crisis of trust is not helped by news this month that the ACCC has fined Optus $100m, subject to court approval, for unconscionable conduct. Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed, allegedly preying on some of our most vulnerable communities and consumers, including Indigenous communities. The Telecommunications Industry Ombudsman has previously identified poor sales conduct - including misleading and high-pressure tactics - as the most common systemic issue it investigates. These concerns are not academic, they have a real-world impact every day for Australians. And it appears to me that the regulator is protecting Australian telecommunication consumers' interests. We believe a parliamentary inquiry into ACMA's recent decision-making should be initiated to assess the regulator's performance, ensure accountability, and restore public confidence in the regulation of communications in Australia. To safeguard public revenue and promote competition in the telecommunications sector, the government must consider whether ACMA's approach to conducting auctions for expiring spectrum licenses is suitable. Australia must have faith in its telecommunications and an effective regulator is critical to this. We must also have faith that a valuable public asset is delivering full value to taxpayers and will continue to deliver the best and most advanced technologies to consumers at affordable prices well into the future. The federal budget is under pressure, the global economic outlook is volatile and cost-of-living pressures continue to hammer Australian families. And yet the communications regulator is proposing the federal government adopt a policy that could forgo up to $3.2 billion in revenue. The approach would also reduce competition among telecommunications providers and hamper the introduction of new technologies. It all revolves around how the federal government approaches telecommunications spectrum licenses. Some 69 existing spectrum licenses across seven bands are due to expire between 2028 and 2032, 48 of which are held by three mobile network operators. Spectrum is a valuable public resource. It must be managed carefully to ensure the proper functioning of commercial, government, military and emergency communications - everything from mobile phones, to radios, to televisions, to satellites, to submarines utilise spectrum to communicate. It is the job of the regulator, the Australian Communications and Media Authority (ACMA), to assign spectrum. However, their approach to this issue is baffling and potentially costly. ACMA plans to renew expiring mobile spectrum licenses without a competitive auction, a decision that risks forfeiting between $2 billion and $3.2 billion in public revenue over the coming years. The cost has been estimated in independent economic analysis by Professor Richard Holden, Scientia Professor of Economics at UNSW Business School and editor of the Journal of Law and Economics. Professor Holden says the failure to hold a competitive auction for spectrum is "based on flawed economic reasoning (and) may significantly undermine public trust, market competition, and the integrity of the regulatory process". In his independent analysis, commissioned by ACCAN, Professor Holden argues that by granting renewed access to existing telcos without testing the market through an auction, ACMA risks entrenching incumbent dominance, limiting opportunities for new entrants, and failing to ensure fair market value for a critical public resource. Remember, this is a public resource that ACMA must manage in the best interest of the Australian people. You don't need to be an expert to understand that if you have an asset that multiple parties want to purchase, it makes sense to have a competitive process for its sale. Many of us act on this logic when we put our homes up for auction or other competitive sales approaches. The failure of the regulator, ACMA, to understand this is bewildering. One can only conclude that ACMA is more concerned about the welfare of the industry rather than the impact this proposal will have on the Australian public. As Professor Holden points out, if this proposed approach proceeds, it will likely be presented as "a textbook case of regulatory capture". Of course, it is not the first time this question as been asked. In January this year, the ABC cast doubt on the independence of ACMA over its practice of sharing press releases in advance of public dissemination with companies about whom it had taken regulatory action after an in-depth investigation. The ABC has also criticised ACMA as a "watch poodle" in regard to its enforcement of decently standards in the Radio Code in a Media Watch segment in 2024. Not only did the chair of ACMA seem unable to provide a straight answer about content suitability in front of the Senate - but the quantum of the fines it doled out was appropriately criticised as a "slap on the wrist". And yet, this is a time when we need a strong regulator to protect the public interest more than ever. Trust in our major telcos is brittle. Our research shows that 41 per cent of consumers have limited faith in their telco to act in their best interest -and almost a third said the coverage they received didn't match what they were told to expect. The latest Morgan Poll placed the telcos just behind the major supermarkets in public trust. This crisis of trust is not helped by news this month that the ACCC has fined Optus $100m, subject to court approval, for unconscionable conduct. Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed, allegedly preying on some of our most vulnerable communities and consumers, including Indigenous communities. The Telecommunications Industry Ombudsman has previously identified poor sales conduct - including misleading and high-pressure tactics - as the most common systemic issue it investigates. These concerns are not academic, they have a real-world impact every day for Australians. And it appears to me that the regulator is protecting Australian telecommunication consumers' interests. We believe a parliamentary inquiry into ACMA's recent decision-making should be initiated to assess the regulator's performance, ensure accountability, and restore public confidence in the regulation of communications in Australia. To safeguard public revenue and promote competition in the telecommunications sector, the government must consider whether ACMA's approach to conducting auctions for expiring spectrum licenses is suitable. Australia must have faith in its telecommunications and an effective regulator is critical to this. We must also have faith that a valuable public asset is delivering full value to taxpayers and will continue to deliver the best and most advanced technologies to consumers at affordable prices well into the future. The federal budget is under pressure, the global economic outlook is volatile and cost-of-living pressures continue to hammer Australian families. And yet the communications regulator is proposing the federal government adopt a policy that could forgo up to $3.2 billion in revenue. The approach would also reduce competition among telecommunications providers and hamper the introduction of new technologies. It all revolves around how the federal government approaches telecommunications spectrum licenses. Some 69 existing spectrum licenses across seven bands are due to expire between 2028 and 2032, 48 of which are held by three mobile network operators. Spectrum is a valuable public resource. It must be managed carefully to ensure the proper functioning of commercial, government, military and emergency communications - everything from mobile phones, to radios, to televisions, to satellites, to submarines utilise spectrum to communicate. It is the job of the regulator, the Australian Communications and Media Authority (ACMA), to assign spectrum. However, their approach to this issue is baffling and potentially costly. ACMA plans to renew expiring mobile spectrum licenses without a competitive auction, a decision that risks forfeiting between $2 billion and $3.2 billion in public revenue over the coming years. The cost has been estimated in independent economic analysis by Professor Richard Holden, Scientia Professor of Economics at UNSW Business School and editor of the Journal of Law and Economics. Professor Holden says the failure to hold a competitive auction for spectrum is "based on flawed economic reasoning (and) may significantly undermine public trust, market competition, and the integrity of the regulatory process". In his independent analysis, commissioned by ACCAN, Professor Holden argues that by granting renewed access to existing telcos without testing the market through an auction, ACMA risks entrenching incumbent dominance, limiting opportunities for new entrants, and failing to ensure fair market value for a critical public resource. Remember, this is a public resource that ACMA must manage in the best interest of the Australian people. You don't need to be an expert to understand that if you have an asset that multiple parties want to purchase, it makes sense to have a competitive process for its sale. Many of us act on this logic when we put our homes up for auction or other competitive sales approaches. The failure of the regulator, ACMA, to understand this is bewildering. One can only conclude that ACMA is more concerned about the welfare of the industry rather than the impact this proposal will have on the Australian public. As Professor Holden points out, if this proposed approach proceeds, it will likely be presented as "a textbook case of regulatory capture". Of course, it is not the first time this question as been asked. In January this year, the ABC cast doubt on the independence of ACMA over its practice of sharing press releases in advance of public dissemination with companies about whom it had taken regulatory action after an in-depth investigation. The ABC has also criticised ACMA as a "watch poodle" in regard to its enforcement of decently standards in the Radio Code in a Media Watch segment in 2024. Not only did the chair of ACMA seem unable to provide a straight answer about content suitability in front of the Senate - but the quantum of the fines it doled out was appropriately criticised as a "slap on the wrist". And yet, this is a time when we need a strong regulator to protect the public interest more than ever. Trust in our major telcos is brittle. Our research shows that 41 per cent of consumers have limited faith in their telco to act in their best interest -and almost a third said the coverage they received didn't match what they were told to expect. The latest Morgan Poll placed the telcos just behind the major supermarkets in public trust. This crisis of trust is not helped by news this month that the ACCC has fined Optus $100m, subject to court approval, for unconscionable conduct. Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed, allegedly preying on some of our most vulnerable communities and consumers, including Indigenous communities. The Telecommunications Industry Ombudsman has previously identified poor sales conduct - including misleading and high-pressure tactics - as the most common systemic issue it investigates. These concerns are not academic, they have a real-world impact every day for Australians. And it appears to me that the regulator is protecting Australian telecommunication consumers' interests. We believe a parliamentary inquiry into ACMA's recent decision-making should be initiated to assess the regulator's performance, ensure accountability, and restore public confidence in the regulation of communications in Australia. To safeguard public revenue and promote competition in the telecommunications sector, the government must consider whether ACMA's approach to conducting auctions for expiring spectrum licenses is suitable. Australia must have faith in its telecommunications and an effective regulator is critical to this. We must also have faith that a valuable public asset is delivering full value to taxpayers and will continue to deliver the best and most advanced technologies to consumers at affordable prices well into the future. The federal budget is under pressure, the global economic outlook is volatile and cost-of-living pressures continue to hammer Australian families. And yet the communications regulator is proposing the federal government adopt a policy that could forgo up to $3.2 billion in revenue. The approach would also reduce competition among telecommunications providers and hamper the introduction of new technologies. It all revolves around how the federal government approaches telecommunications spectrum licenses. Some 69 existing spectrum licenses across seven bands are due to expire between 2028 and 2032, 48 of which are held by three mobile network operators. Spectrum is a valuable public resource. It must be managed carefully to ensure the proper functioning of commercial, government, military and emergency communications - everything from mobile phones, to radios, to televisions, to satellites, to submarines utilise spectrum to communicate. It is the job of the regulator, the Australian Communications and Media Authority (ACMA), to assign spectrum. However, their approach to this issue is baffling and potentially costly. ACMA plans to renew expiring mobile spectrum licenses without a competitive auction, a decision that risks forfeiting between $2 billion and $3.2 billion in public revenue over the coming years. The cost has been estimated in independent economic analysis by Professor Richard Holden, Scientia Professor of Economics at UNSW Business School and editor of the Journal of Law and Economics. Professor Holden says the failure to hold a competitive auction for spectrum is "based on flawed economic reasoning (and) may significantly undermine public trust, market competition, and the integrity of the regulatory process". In his independent analysis, commissioned by ACCAN, Professor Holden argues that by granting renewed access to existing telcos without testing the market through an auction, ACMA risks entrenching incumbent dominance, limiting opportunities for new entrants, and failing to ensure fair market value for a critical public resource. Remember, this is a public resource that ACMA must manage in the best interest of the Australian people. You don't need to be an expert to understand that if you have an asset that multiple parties want to purchase, it makes sense to have a competitive process for its sale. Many of us act on this logic when we put our homes up for auction or other competitive sales approaches. The failure of the regulator, ACMA, to understand this is bewildering. One can only conclude that ACMA is more concerned about the welfare of the industry rather than the impact this proposal will have on the Australian public. As Professor Holden points out, if this proposed approach proceeds, it will likely be presented as "a textbook case of regulatory capture". Of course, it is not the first time this question as been asked. In January this year, the ABC cast doubt on the independence of ACMA over its practice of sharing press releases in advance of public dissemination with companies about whom it had taken regulatory action after an in-depth investigation. The ABC has also criticised ACMA as a "watch poodle" in regard to its enforcement of decently standards in the Radio Code in a Media Watch segment in 2024. Not only did the chair of ACMA seem unable to provide a straight answer about content suitability in front of the Senate - but the quantum of the fines it doled out was appropriately criticised as a "slap on the wrist". And yet, this is a time when we need a strong regulator to protect the public interest more than ever. Trust in our major telcos is brittle. Our research shows that 41 per cent of consumers have limited faith in their telco to act in their best interest -and almost a third said the coverage they received didn't match what they were told to expect. The latest Morgan Poll placed the telcos just behind the major supermarkets in public trust. This crisis of trust is not helped by news this month that the ACCC has fined Optus $100m, subject to court approval, for unconscionable conduct. Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed, allegedly preying on some of our most vulnerable communities and consumers, including Indigenous communities. The Telecommunications Industry Ombudsman has previously identified poor sales conduct - including misleading and high-pressure tactics - as the most common systemic issue it investigates. These concerns are not academic, they have a real-world impact every day for Australians. And it appears to me that the regulator is protecting Australian telecommunication consumers' interests. We believe a parliamentary inquiry into ACMA's recent decision-making should be initiated to assess the regulator's performance, ensure accountability, and restore public confidence in the regulation of communications in Australia. To safeguard public revenue and promote competition in the telecommunications sector, the government must consider whether ACMA's approach to conducting auctions for expiring spectrum licenses is suitable. Australia must have faith in its telecommunications and an effective regulator is critical to this. We must also have faith that a valuable public asset is delivering full value to taxpayers and will continue to deliver the best and most advanced technologies to consumers at affordable prices well into the future.
The Guardian
10-04-2025
- Business
- The Guardian
Trump's tariffs are rattling Australian markets. Here's what not to do to protect your investments
Global share markets, including in Australia, have recorded large swings ever since Donald Trump released his 'liberation day' tariff plans. Australia's benchmark S&P/ASX 200 witnessed its steepest one-day fall on Monday in five years, before registering its biggest one-day rise in two years on Tuesday. It then fell sharply on Wednesday, before rebounding strongly on Thursday, to around last week's levels. If you are anxious about the volatile market and the impact it's having on your investment or retirement portfolio, here are some common human reactions that need to be managed to avoid making a volatile situation worse. Investors are grappling with a fundamental question over whether the market ruptures are a temporary setback or a structural shift, which means shares need to be completely repriced. While investors will come to different conclusions, Elise Payzan-LeNestour, professor of finance at the UNSW Business School, recommends assessing what any dent in your investment performance means to you. 'Your first reaction should be to adopt a cognitive perspective and assess what does it mean given my situation, my investment horizon,' says Payzan-LeNestour, who researches how people perceive and react to financial risks. Sign up for the Afternoon Update: Election 2025 email newsletter She says if you need to access your investment relatively soon, such as for retirement or a home deposit, you may need to act fast. 'In your situation, hesitation is going to be inherently costly, and so reacting swiftly is just about everything,' she says. 'Don't freeze.' While markets can recover quickly, as seen in the quick rebound after the Covid sell-off, the lag can vary greatly. It took 15 years for the Nasdaq to recover its highs after the tech wreck of 2000, and more than 33 years for the Nikkei to get back to levels reached in 1990, when the Japanese asset price bubble finally burst. Investment firms have warned there are still significant risks to the global economy, even after Donald Trump's decision to pause steep tariffs against most nations ignited a share market rally. Multinational investment bank UBS said on Thursday the rebound in global markets offered investors an opportunity to 'take stock, diversify portfolios', and prepare for market volatility. On the flip side, Payzan-LeNestour says those with portfolios that don't need to be accessed any time soon should probably stop looking at their account balances. 'Their job is to exert restraint, which is extremely challenging from a psychological point of view, but don't let panic steer the wheel,' she says. 'That's why blissful ignorance is key, because if you track your portfolio every day, it's highly likely that you won't manage to endure.' The abundance of pricing information in the digital age has given people the ability to constantly track their wealth, including super balances, rather than wait for periodic paper updates. This has heightened both positive and negative emotions tied to short-term market movements. Phillip Bures, a financial planner with Nestworth Financial Strategists, says the investors most likely to be spooked are those with less experience and those without a thought-out strategy in place. When investors see the size of their account fall, there's a temptation to chase losses through wild trading. Financial adviser Gareth Colgan, the managing director at Wellbeing Wealth, says the human brain is 'not hardwired to remain rational at times like these', but he adds that the most successful investors are able to stay calm. Colgan says just as people shouldn't flock to the market when it's running really hot, the same applies when markets crash and 'everyone's losing their minds'. 'Investment, like a market cycle, is an emotional rollercoaster,' he says. 'Investors who are trying to remain rational, and be prudent, [and] buy assets when they represent good value and not follow the herd type of mentality – they will do very well from just riding through these market cycles.' Some investors will make the mistake of buying high and selling low. Others will try to trade themselves out of trouble by doubling down as markets fall– not always a terrific strategy, according to investment firms. The chief investment strategist at Saxo, Charu Chanana, says investors should seek investments that are 'fundamentally strong', showing signs of healthy profits, and stable cashflow. 'Buying the dip is one of the oldest instincts in investing – but when markets are being hit by policy shocks, forced selling, and macro uncertainty, it can be hard to tell a bargain from a trap,' Chanana says. The chief economist at Sydney-based Betashares, David Bassanese, says the rebound in share prices on Thursday could prove to be a 'cruel bear market rally' given the ongoing risks to the global economy. A bear market rally refers to a temporary lift in stock prices in an otherwise falling market. The current market chaos, led by fast-paced policy changes by Trump, is a good reminder that it's very difficult to pre-empt market movements. Even Deutsche Bank, which said earlier this week that the Reserve Bank would cut rates by a jumbo half percentage point in May, changed its view hours after Trump unveiled the pause on tariffs. Andrew Grant, a behavioural finance expert from the University of Sydney, says most investors should be taking a long-term approach to their finances, as opposed to making short-term bets. 'Generally speaking, knowing that you probably don't know a lot about what's going to happen is the best approach,' says Grant. 'Thinking that you know more than people who are trading professionally and trying to second guess what everyone else is going to do is probably not a sensible strategy. 'A lot of people can handle risk when things are going well, but not when things are going badly.'
