The exercise of developing a 'bottom-up' cost model for the mobile terminating access service (MTAS) had been part of an extensive consultation process which began with the Mobile Services Review in 2003.
That consultation process informed the MTAS pricing principles determination for the period 1 July 2004 to 30 June 2007, which expired on 30 June 2007.
To support future MTAS pricing principles determinations, the Australian Competition and Consumer Commission issued a request for tender in March 2006 seeking the services of a consultant to construct a bottom-up cost model with specific economic and engineering parameters for mobile termination access services in Australia. WIK Consult was engaged in June 2006 and worked with the ACCC to develop a bottom-up cost model that would estimate the efficient cost of supplying the MTAS in Australia using a total services long-run incremental cost conceptual framework.
The ACCC issued a discussion paper and sought submissions from interested parties on issues relating to the WIK mobile network and cost model (WIK model) and the accompanying Mobile termination cost model for Australia report (WIK report). After considering interested parties’ submissions, the ACCC released the Draft MTAS pricing principles determination for the period 1 July 2007 to 31 December 2008.