2012 Australia - Mobile Broadband Market

Mobile broadband ups the speed and user base with LTE

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.

Just as BuddeComm previously predicted, the use of Long-term evolution (LTE) mobility broadband would boost 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. We provide details on the nearly 500,000 premises that will receive this fixed-wireless service, as those covered by it will be beyond reach of fast-fibre. The first fixed-wireless release sites are under construction with this network finalised by end-2015. The satellite services are currently coming from an interim satellite service and then will be delivered from two new KA-band satellites at the cost of around $2 billion.

Even though the cost of mobile broadband is still markedly expensive as compared to fixed broadband, in the publication we provide information on the increased usage that is being led by smartphones. With around 60% of smartphone users using a mobile phone to access the internet and then make product purchases, usage will only continue upwards as more users take on the use of mobile broadband.

As the smartphone sector in Australia sits in mid-2012, the Android market has now overtaken the iPhone as the user’s choice as the top smartphone. Nokia, Samsung and HTC are all seeing their market share change and with the 4G handset market about to expand as users come off plans, the changing of the brands may see applications and data usage increase once again. We will see the smartphone market continue to increase to more than 60% penetration by end-2012.

In this publication we also provide a brief global overview of the mobile broadband market. We update information on the rapid development of low-cost smartphones that are projected to go below $50 soon, and with tablets now already under $200, meaning that many people in the world who are not PC literate or have the ability to buy a PC - will be able to experience broadband internet for the first time through a mobile phone.

Traditionally SMS was the ‘cash cow’ for the mobile network operators. But in 2012 many mobile phone plans now also include free access to social networking sites or low cost using of over-the-top messaging services. So we are seeing mobile subscribers using iMessage and other apps including mobile email to keep connected and communicate, rather than the previous operator only method of SMS.

But SMSs also provide instant user attention as opposed to an email that may be unread for a number of hours or days. So SMSs will remain part of the culture. In this publication we provide an overview of the trends in SMS data revenue and messages with statistical background information.

The availability of mobile broadband has seen social networking boom on the move. So as we need a fast upload speed to allow the 35% of Australians who use Facebook on their mobile. The high uptake of these mobile service will also see more and more users adding to the mobile broadband user base.

The mobile broadband infrastructure in Australia at times often becomes data saturated and to ease the congestion the mobile network operators are progressively updating, expanding rolling out faster networks to support the data explosion. Two of MNOs have long-term evolution networks, Telstra deployed LTE commercially with Optus still in trial mode as at mid-2012, but with plans for the rollout by year end.

Meanwhile Vodafone has been updating its 3G network infrastructure and is expected to move into LTE area sometime in 2013. The Vodafone and Optus network sharing agreement that is to take effect in 2013 will allow greater coverage by these MNOs and may put pressure on Telstra users to return to these operators.

The mobile apps, mobile media and PMS markets are profiled in the publication with apps-based mobile content and communication services. The MNOs portals are profiled together with a snapsot of the major mobile media providers.

Market highlights:

• BuddeComm estimates that mobile broadband users will exceed six million by end-2012 with growth rates still over 10%.
• Facebook user growth is now slowing down with more than 11 million Australians with accounts.
• Meanwhile around 35% of Facebook use is on a mobile device.
• Smartphone penetration now exceeds 50% penetration rate, with 60% estimated by end-2012.
• Revenue from SMS still continues to be the largest component of mobile data revenue for all the major mobile operators in Australia in 2012, but its share and value is decreasing.
• Mobile broadband ARPU starts falling for 3G services.

Data in this report is the latest available at the time of preparation and may not be for the current year.