Virus impact over each market - telecom operators, government agencies and regulators' responses - revised forecasts for the next 5 years.
Last updated: 9 Jan 2013 Update History
Report Status: Archived
Report Pages: 88
Analyst: Paul Budde
This tables only report provides 142 statistical tables and 77 charts for fixed-line and mobile operations in Australia, together with summaries of company statistics.
Researchers:- Paul Budde, Stephen McNamara
Current publication date:- January 2013 (6th Edition)
National Broadband Network
Several things became clear during the privatisation process of Telstra in the 00s. Broadband quality was below the international benchmark; end-user and wholesale prices were above that mark; and there was no economically viable business case for high-speed broadband infrastructure for regional and rural Australia. At that time both sides of government were in favour of government intervention in order to rectify this situation. Telstra, however, was determined to maintain its monopoly and in the end the government had to step in. This led to the structural separation of the company.
At the same time, because of the GFC, the government decided to change its broadband infrastructure plan from a regional to a national one. They also linked that to the development of the digital economy and launched supporting policies in e-commerce, e-health, e-education and smart grid, all aimed at utilising the NBN for those purposes. The $36 billion plan includes a government investment of $27 billion and needs to be seen in the context of the $60 billion raised by the privatisation of Telstra.
Smart grids support the delivery of electricity to consumers using digital communications technology to improve efficiency and reduce costs. The major players building smart grids in Australia are mostly large energy retailers and producers supported by IT and telecommunications firms.
The mobile communications market in Australia has seen lots of infrastructure activity in the last year from the mobile network operators (MNOs), with some of the results of that activity still to come to fruition into 2013 and beyond. New investments are driven by a rapidly changing market led by consumer demand, handset saturation and the demand of faster-speed technologies in the fixed- broadband market. Competition in the mobile sector is driving the mobile market to a lower dollar value return on a user basis. This is being compensated by more data use on a variety of mobile devices and growth in the emerging M2M market.
With the mobile handset market being driven by smartphone uptake, this is also driving mobile broadband usage and the increase of over-the-top applications that are now depriving the mobile network operators from their traditional income streams. Mobile voice calls have now reached their peak and will start a slight level of ongoing decrease over coming years.
As the smartphone sector in Australia takes off, in mid-2012 we see that the Android market has overtaken the iPhone as the user’s choice as the top smartphone. But with the 4G handset market about to expand as users come off plans, the changing of leading brands may occur once again and we will see applications and data usage further increase placing strains on the limited spectrum availability.
While overall mobile services revenue growth by the mobile network operators over the last financial years has decreased on a year-on-year bases, in 2012 we are seeing a further slowdown in growth with revenue growth going negative for Vodafone.
Broadband is the facilitator for a range of services that are of great value to governments, businesses and people in rural and regional areas as well as in the cities. Mobile broadband can also increase this value even further. With around 5.5 million mobile broadband subscribers in Australia, the release of a 4G network by one mobile network operator saw uptake of more than 300,000 services in just over half a year.
The use of Long-term evolution (LTE) mobility broadband has boosted the uptake of mobile broadband usage and this is also likely to expand further as the National Broadband Network (NBN) use of wireless services commence. Australia will see the NBN connect around 7% of all premises in the country to fixed-wireless networks.
The availability of mobile broadband has seen social networking boom on the move, so we need a fast upload speed to allow the 35% of Australians who use Facebook on their mobile. The high uptake of these mobile services will also see more and more users adding to the mobile broadband user base.
Telstra is Australia’s largest telecommunications provider offering a full range of telecom services throughout Australia. The company provides basic access services to most homes and businesses, local and long-distance telephone call services, and mobile and Internet services including just under seven million fixed lines and more than 13 million mobile connections.
Wholesale services are also provided to ISPs and RSPs while advertising and subscription television services are provided through subsidiary companies. By September-2012 Telstra is seeing large increases in 4G LTE voice and mobile broadband services and is keen to expand in this growing area over the next couple of years. The last couple of years have seen extraordinary growth in prepaid mobile connections and in 2012 prepaid numbers now exceed postpaid services.
Optus provides a range of communications services that include mobile, national and long-distance services, local and international telephony, business network services, internet and satellite services, subscription TV and digital media services.
Into 2012 the company is aiming to expand its customer base through new services. These include the provision of MeTV, an IPTV service with FetchTV, expanded mobile coverage in Tasmania, refarming 2G to 3G, the launch of 4G services and an agreement providing interim satellite services in the National Broadband Network. These new and additional services will allow Optus to gain new subscribers across its coverage areas and to more remote and regional communities.
The numbers of wireless broadband subscribers continues to boom rising 28% year-on-year in mid-2012 and is continuing to deliver higher data revenue, although as the market rises to saturation levels BuddeComm believes that the rising returns will slowly diminish. The takeover of vividwireless from Seven Media will boost the amount of 4G spectrum and subscribers and market share in the markets where vividwireless operates. The restaurant review company Eatability purchased by the company in mid-2012 will add a digital media and content service flavour to the company.
Second tier telcos
Telecommunications regulatory reform will continue to feature into 2012 as the Telecommunications Consumer Protection (TCP) Code will see the power of pricing and usage monitoring become easier for consumers, with service providers possibly being overseen by the regulators. The other major feature will be the new regulations governing the transition period between now and the arrival of the NBN. Subsequently other smaller and niche market operators will look for opportunities to gain a greater market share of the telecommunications revenue streams to shore up their returns.
The second-tier market is making gains in broadband and they are gearing up for IPTV which will then be bundled into their other product offerings. Although the bundled market often sees overall revenues fall but it generally maintains a higher ARPU. Also in 2012 further consolidation is expected.
While the fixed-voice market revenue declines in the second-tier market so too are mobile and broadband revenues. Falling revenue reflects increased bundle value as well as consumers moving away from fixed-voice services, but it may also be a symptom of increased reliance on VoIP-based and naked DSL platforms in the second-tier market. Nevertheless, overall revenues in second-tier mobile services and data services (including internet access) continue to show growth.
Data in this report is the latest available at the time of preparation and may not be for the current year.
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