It might be fair to describe the Telstra Corporation Ltd (ASX: TLS) share price as being 'stuck in no man's land'. Today, Telstra shares lost 0.51% of their value, falling to $3.92 each by market close. But, as we looked at yesterday, this puts the Telstra share price at a 7% loss for the 2022 year to date.
After a stellar 2021, which saw Telstra shares gain an impressive 40% or so, this is certainly a change of pace.
One factor that could be weighing on investor sentiment is the ongoing feud between Telstra, its fellow ASX-listed telco TPG Telecom Ltd (ASX: TPG), and its arch-rival Optus.
Optus is not an ASX-listed company. In fact, it isn't even Australian, being owned in full by the giant Singaporean telco Singtel.
But that hasn't stopped Optus from raging against what it sees as a detrimental tie-up between Telstra and TPG.
Telstra caught up in Optus spat
As we reported back in July, Optus has taken umbrage with a deal between Telstra and TPG that was first flagged back in February. This will see Telstra give TPG access to around 3,700 Telstra mobile towers, mostly in regional and suburban areas.
This will allow TPG to increase its 4G coverage from 96% to 98.8% of the Australian population. For its trouble, Telstra will receive an estimated $1.6-$1.8 billion in revenues over the next decade from TPG.
But Optus cried foul, seeing the deal as detrimental to its own service provision in regional areas. As we reported in July, Optus stated that the deal would "lead to a loss of competition and material consumer and public detriment… [and] 'locking' competition out of the regional market and eliminating choice in regional Australia".
Well, we've now seen the latest chapter in this ongoing dispute. According to a report from itnews.com.au, Telstra and TPG have openly refuted Optus' claim that their scheme amounted to a 'merger' directly to the Australian Competition and Consumer Commission (ACCC). The report states that:
Telstra and TPG have unleashed a blizzard of expert reports in an attempt to refute Optus' opposition to their proposed spectrum and network-sharing deal.
Optus has already pulled out the big guns
The crux of these reports alleges that Optus would be unable to provide the same kind of arrangement to TPG that it has struck with Telstra. In addition, the reports refute Optus' other allegations. These include that the deal reduces competition and boosts Telstra's already dominant market share.
In contrast, senior Optus executives alleged back in June that the proposed deal would be "a backward step for millions of Australians".
That was none other than former New South Wales premier Gladys Berejiklian.
Berejiklian is now a senior executive with Optus. As we covered at the time, she went on to say:
Our regions need more telecommunications investment, better connectivity, and improved services – and the proposed Telstra / TPG network merger is a very big step backward.
The proposed merger risks these advantages and the future ones and with that, our nation's economic potential.
So lot's going on in the ASX telco space at the moment. We can't be sure of these ongoing spats are denting ASX investors' confidence in the Telstra share price. But it does not seem like they are helping, going off the company's lacklustre performance over 2022 thus far.