Telecommunications companies have little incentive to expand mobile coverage in rural Australia, and their rapid sale of phone towers could limit better connectivity, the consumer watchdog has found.
The Australian Competition and Consumer Commission has been investigating access to mobile towers, and whether roaming can be provided during natural disasters and emergencies.
Rural Australians told the long-running inquiry mobile coverage was inadequate and they were concerned it would only get worse as regional populations grew.
Country residents said they needed consistent connectivity for their finances, health and education, while farmers increasingly relied on mobile service to operate machinery.
"There is clear demand in regional, rural and remote areas for better mobile coverage and more choice of network operator," ACCC commissioner Anna Brakey said.
Building more phone towers could improve coverage, but high costs, red tape and low returns meant mobile operators were not incentivised to invest, particularly in remote areas, the inquiry's report said.
Co-location of mobile services, in which two providers share a tower to improve coverage, may not be straightforward either after telecommunications companies rapidly sold off their infrastructure.
The commission's report said Telstra transferred more than 8000 towers to Amplitel, a communications infrastructure company it majority owns.
Optus's parent company sold off many of its towers in several deals, with 4300 sites held under a new entity called Indara Digital Infrastructure, while TPG also transferred its towers last year.
These sales could limit mobile tower sharing arrangements, Ms Brakey said.
"This has created a strong bilateral contractual relationship between the old owner and the new owner, which can create restrictions and impact whether infrastructure sharing options are pursued."
The inquiry also found temporary mobile roaming was possible during natural disasters and other emergencies, but commercial arrangements would need to be agreed upon.
