2015 Australia - Fixed Broadband Market - Insights, Statistics and Analysis

Publication Overview

This report provides statistics and analyses on Australia’s fixed-line broadband sector, including recent developments affecting the NBN as well as DSL and HFC networks. The report assesses overall market dynamics, and the key operating performance of the principal players. It also covers developments in NBN Co’s efforts to extend the footprint of the NBN by utilising the existing copper infrastructure of Telstra and Optus, and examines the likely trends which will develop into 2015 and further ahead as the broadband sector adjusts to the introduction of OTT and SVoD services from providers including Presto TV, Stan and Netflix..

Researchers:- Henry Lancaster, Paul Budde
Current publication date:- June 2015 (14th Edition)

Executive Summary

NBN makes deployment progress as soaring SVoD traffic places extra demands on networks

This report provides statistics and analyses on Australia’s fixed-line broadband sector, including recent developments affecting the NBN as well as DSL and HFC networks. The report assesses overall market dynamics, and the key operating performance of the principal players. It also covers developments in NBN Co’s efforts to extend the footprint of the NBN by utilising the existing copper infrastructure of Telstra and Optus, and examines the likely trends which will develop into 2015 and further ahead as the broadband sector adjusts to the introduction of OTT and SVoD services from providers including Presto TV, Stan and Netflix.

Focus still on a second-best FttN infrastructure

The changing political landscape in Australia since 2013 has resulted in a fragmented broadband policy, with a national network based predominantly on FttP having been ditched for a multi-technology mix utilising existing and aging copper infrastructure. The country has fallen further in international league tables for broadband speed, a situation which will become more pronounced as its main trading partners and economic competitors ramp up their own FttP networks, and so pull further ahead as they capitalise on opportunities provided in the digital future.

DSL and HFC networks still of value

With the broadband sector now dependent on a multi-technology NBN, the DSL and HFC sectors have gained a reprieve of sorts. At the end of 2014 NBN Co struck a deal to incorporate copper infrastructure owned by Telstra and Optus within the NBN in areas where copper would provide the best service.

While much of the cable infrastructure has been upgraded to provide data at up to 100Mb/s, this is an interim measure. The DOCSIS 3.1 standard has scope to deliver 1Gb/s, and so meet the anticipated overall data needs of the average household in coming years. NBN Co in April 2015 revealed plans to trial new HFC technologies in several suburbs of NSW and Queensland by mid-year, with a potential to incorporate DOCSIS 3.1 technology within the NBN’s multi-technology mix from 2017. DSL could also potentially benefit from the recently standardised G.fast technology, though in both cases copper remains a solution for high density areas only.

Residential and business sectors requiring faster data

A growing number of businesses with access to the NBN have switched to fibre services in a bid to compete in the global economy more effectively, and make use of such services as cloud computing, online interaction, and media conferencing. Businesses connected with fibre generate far more traffic than their copper-based counterparts. The same trend is seen in the residential sector, where the launch of Netflix in March 2015 immediately showed the strains of popular video-on-demand on aging copper infrastructure.

Slow but promising growth in greenfield fibre

The deployment of FttP has been supported by a recent framework agreement under which new major housing sites are to be supplied with FttP infrastructure, or to be made ready for such deployment. Regulations proposed in late 2014 outlined the responsibilities of NBN Co and Telstra for the provision of fibre in these developments, and some of the aspects effective became effective from March 2015. These are aimed at improving competition, minimising costs, and providing a level playing field for operators. NBN Co is the operator of last resort for housing developments where a commercial solution is not economically viable, while Telstra fills that role under certain conditions. As a measure of progress since the slow impetus seen in 2011, in the third week of April 2015 alone almost 17,000 lots or premises were passed by the NBN, of which about 13,980 were in brownfield and 1,870 in greenfield areas.

Key developments:

  • Average traffic per user on NBN reached 83GB per month at end-2014;
  • Draft standards published related to vectored VDSL2 services on the NBN;
  • Government adopts a multi-technology mix for the NBN;
  • DSL vectoring developments;
  • HFC looks to potential of DOCSIS 3.1;
  • Telcos’ operating data to Q4 2014;
  • ACMA market report 2014;
  • ABS data to December 2014;
  • Recent market developments.

Companies mentioned in this report:

Optus, Telstra, Quickflix, Presto TV, Stan, NBN, TransACT, Exetel, Vodafone, Sensis, NBN Co, iiNet, TPG

Table of Contents

  • 1. The Market in 2015
    • 1.1 Broadband changing telco business model from retail to wholesale
    • 1.2 Low cost economy depends on ubiquitous affordable high speed broadband
    • 1.3 Australia vs America – what leaders say about broadband speeds
    • 1.4 Downstream speeds vs upstream speeds
    • 1.5 Broadband services in rural Australia worse than we thought
    • 1.6 Whatever happened to the rollout of the fixed wireless NBN in regional Australia?
    • 1.7 The Minister for Lost Opportunities
    • 1.8 Revised NBN with multi-technology architecture sees further use for DSL and cable networks
  • 2. General Overview and Market Insights
    • 2.1 Overall size of the market
      • 2.1.1 Total broadband subscribers
      • 2.1.2 Market shares
    • 2.2 Access revenues
      • 2.2.1 Statistical overview
      • 2.2.2 Average Revenue per User (ARPU)
    • 2.3 Other surveys and statistics
      • 2.3.1 Australian Bureau of Statistics (ABS) Survey – update December 2014
      • 2.3.2 Statistical information by technology
      • 2.3.3 Broadband speeds
      • 2.3.4 Broadband traffic
    • 2.4 ISP market overview
      • 2.4.1 The market going forward
      • 2.4.2 Data limiting
      • 2.4.3 ISP market statistics
      • 2.4.4 Consolidation in the ISP market
      • 2.4.5 Digital Media – Triple play business models
      • 2.4.6 Voice over Internet Protocol (VoIP) added to naked DSL
    • 2.5 Benchmarking with other countries
      • 2.5.1 Fixed broadband
      • 2.5.2 Wireless broadband
  • 3. Statistical Overview of the DSL Market
    • 3.1 Brief overview of the NBN
    • 3.2 Regulatory environment – analysis
      • 3.2.1 The impact of fibre optic networks on digital subscriber line (DSL) regulation
      • 3.2.2 Unbundling of the local loop (ULL) and Bitsream Access
      • 3.2.3 Wholesale DSL pricing
    • 3.3 DSL infrastructure
      • 3.3.1 Overview
      • 3.3.2 Tool for competitors
      • 3.3.3 DSLAM infrastructure
      • 3.3.4 Street cabinet IP DSLAM2 upgrades (Top Hat)
      • 3.3.5 VDSL developments
      • 3.3.6 VDSL vectoring
    • 3.4 Brief overview of broadband providers market
      • 3.4.1 Market consolidation
      • 3.4.2 The shrinking number of ISPs
      • 3.4.3 Market share statistics
  • 4. Statistical Overview of the HFC Market
    • 4.1 Technology
      • 4.1.1 Hybrid Fibre Coax (HFC)
      • 4.1.2 The DOCSIS standard
      • 4.1.3 The next development for DOCSIS
      • 4.1.4 HFC DOCSIS vs. fibre
    • 4.2 Market statistics and estimates
    • 4.3 Telstra
      • 4.3.1 Background information
      • 4.3.2 Network upgrades
    • 4.4 Optus
      • 4.4.1 Overview
      • 4.4.2 Network upgrades
    • 4.5 IiNet/TransACT
      • 4.5.1 Overview
    • 4.6 BES/e-wire
    • 4.7 Austar United Communications (AUSTAR)
    • 4.8 Industry analysis
      • 4.8.1 DOCSIS 3.0 -v- DOCSIS 3.1 (Analysis)
      • 4.8.2 Do we need infrastructure-based competition?
      • 4.8.3 Moving on from the HFC of the past
      • 4.8.4 No long-term future in HFC cable broadband
      • 4.8.5 HFC incorporated in multi-technology NBN
      • 4.8.6 From HFC to Fibre-to-the-Premises (FttP)
      • 4.8.7 Open access policy
  • 5. Business Broadband Market Statistics and Analysis
    • 5.1 Market trends
      • 5.1.1 Business market overview
      • 5.1.2 ISPs targeting the business sector
      • 5.1.3 Broadband stimulating companies to progress
      • 5.1.4 Will the SME market finally succumb to VoIP?
      • 5.1.5 The NBN and the business market
      • 5.1.6 Business need faster speeds to communicate
      • 5.1.7 The effects of broadband on business and government
    • 5.2 Business market surveys
      • 5.2.1 NBN Business Readiness Surveys
      • 5.2.2 Small Business Telecommunications Service Use and Experience
      • 5.2.3 Surveys reveal that moving online benefits businesses
      • 5.2.4 Telstra Productivity Indicator
      • 5.2.5 Sensis – e-business report
      • 5.2.6 Optus Future of Business Report
    • 5.3 Business customer expenditure on telecoms
      • 5.3.1 Overall telecom spend – business market
      • 5.3.2 SME market statistics
  • 6. Residential Broadband Market Statistics and Analysis
    • 6.1 Statistical overview residential market – total telecoms
    • 6.2 Internet household statistics
      • 6.2.1 Australian Bureau of Statistics (ABS) surveys and internet connectivity
      • 6.2.2 Australian Communications and Media Authority (ACMA) surveys
    • 6.3 Trends in the residential market
      • 6.3.1 Data increases in volume
      • 6.3.2 Mobile broadband – no alternative to fixed line services.
      • 6.3.3 Dial-up internet not hanging up, just yet
    • 6.4 Household use of technology
      • 6.4.1 Computer technologies
      • 6.4.2 Broadband technologies
      • 6.4.3 Internet social media activities
    • 6.5 Other residential market surveys
      • 6.5.1 Online services
      • 6.5.2 Fixed broadband stats: a federal report
      • 6.5.3 New generations survey
      • 6.5.4 Customer service issues and the Telecommunications Industry Ombudsman (TIO)
      • 6.5.5 Demand for cost-effective broadband
  • 7. The National Broadband Network
    • 7.1 Political Developments
      • 7.1.1 NBN – this is as good as it gets
      • 7.1.2 Labor’s NBN 3.0 back to FttH
      • 7.1.3 After the storm – do we need a national inquiry in the reliability of our telecoms networks?
      • 7.1.4 Should taxpayers pay for a NBN based on MTM?
      • 7.1.5 The Minister for Lost Opportunities
      • 7.1.6 Staying focused on the NBN outcomes and bypassing political roadblocks
      • 7.1.7 Biggest threat to NBN is political panic
      • 7.1.8 The unravelling of the NBN
    • 7.2 The NBN company
      • 7.2.1 How independent is NBN Co?
      • 7.2.2 NBN Co threat to proper broadband competition
    • 7.3 Technology Issues
      • 7.3.1 Whatever happened to the rollout of the fixed wireless NBN in regional Australia?
      • 7.3.2 The difference between FttH and FttP
      • 7.3.3 Why Australia needs a Fibre-to-the-Premises policy
      • 7.3.4 Market-led demand for FttH is picking up
    • 7.4 Competition Issues
      • 7.4.1 Open up the metropolitan NBN market to competition
      • 7.4.2 Competition in the telecoms industry is dwindling
      • 7.4.3 TPG highlights the fragile NBN environment
    • 7.5 Other Issues
      • 7.5.1 Broadband services in rural Australia worse than we thought
      • 7.5.2 Australia vs America – what leaders say about broadband speeds
      • 7.5.3 Content – the next regulatory war zone
      • 7.5.4 NBN-related jobs increase by 248% since review
  • 8. The FttP Greenfield Market
    • 8.1 New greenfields policy comes into play
    • 8.2 Fibre Deployment Act 2011
      • 8.2.1 Outline of the Telecommunications Legislation Amendment (Fibre Deployment) Act 2011 (the Act)
      • 8.2.2 NBN Co provider of last resort
      • 8.2.3 Outsourcing contract with Fujitsu
      • 8.2.4 Refinements June 2011
      • 8.2.5 Further strategic changes in 2012
    • 8.3 Analyses
      • 8.3.1 The balancing act in greenfield broadband
      • 8.3.2 ADSL deployment continues
    • 8.4 Rollout developments NBN Co
      • 8.4.1 Sydney’s Doonside first to connect to the NBN
      • 8.4.2 Nationwide roll out
      • 8.4.3 Greenfield construction contracts
    • 8.5 Fibre wholesale from Telstra
    • 8.6 Productivity Commission rules on complaints
    • 8.7 Major Players
      • 8.7.1 OPENetworks
      • 8.7.2 OptiComm
      • 8.7.3 Pivit
      • 8.7.4 Other smaller providers
    • 8.8 Retailers
      • 8.8.1 Internode
      • Table 1 – Broadband speeds - 2015
      • Table 2 – Internet subscribers by advertised download speed – 2013 - 2014
      • Table 3 – Time taken using average dial-up and high-speed broadband services
      • Table 4 – Historical - Total broadband subscribers and annual change – 2000 - 2004
      • Table 5 – Total broadband subscribers and annual change – 2005 - 2016
      • Table 6 – Broadband subscribers, DSL and cable –2008 – 2014
      • Table 7 – Internet and broadband connectivity (fixed-line and mobile) – 2013 - 2014
      • Table 8 – Broadband market share by technology and annual change – 2008 - 2014
      • Table 9 – Broadband revenues by major provider – 2005 - 2014
      • Table 10 – Annual change in broadband access revenues by major provider – 2006 - 2014
      • Table 11 – Market share of broadband access revenues by major provider – 2005 - 2014
      • Table 12 – Estimated fixed broadband ARPUs – 2006 - 2015
      • Table 13 – Wireless internet subscribers by access technology – 2009 - 2014
      • Table 14 – Fixed-line internet subscribers by access technology – 2009 - 2014
      • Table 15 – Business, government and household broadband internet subscribers – 2009 - 2014
      • Table 16 – Business, government and household dial-up internet subscribers – 2009 - 2014
      • Table 17 – Business, government and household total internet subscribers – 2009 - 2014
      • Table 18 – Subscribers’ average speed in Australia versus selected Asia Pacific countries – 2010 - 2014
      • Table 19 – Proportion of internet subscribers by download speed – 2009 - 2014
      • Table 20 – Internet subscribers by download speed – 2008 - 2014
      • Table 21 – Average SVoD streaming speed by ISP – April 2015
      • Table 22 – Terabytes of data downloaded by access technology (historic) – 2008 - 2014
      • Table 23 – Annual change in data downloaded by access technology – 2011 - 2014
      • Table 24 – Average data downloaded per subscriber (fixed-line and mobile) – 2013 - 2014
      • Table 25 – NBN fibre premises passed – 2013 - 2014
      • Table 26 – NBN fibre premises activated – 2013 - 2014
      • Table 27 – Number of ISPs by size in the Australian market – 2008 - 2014
      • Table 28 – Number of ISPs – 2001 - 2014
      • Table 29 – Internet subscribers by key providers – 2013 - 2014
      • Table 30 – Household take-up of VoIP and MoIP services– 2010 - 2014
      • Table 31 – Top ten OECD countries by wireless broadband subscriptions – 2012 - 2014
      • Table 32 – Wholesale DSL pricing, per month per user – 2013 – 2014
      • Table 33 – Number of infrastructure providers by number of ADSL-enabled exchanges – 2007 - 2008; 2010 - 2011
      • Table 34 – DSL broadband subscribers –2008 – 2015
      • Table 35 – DSL subscribers and availability by state/territory – 2013
      • Table 36 – DSL premises affected by distance from exchange – 2013
      • Table 37 – Number of DSLAMs by major providers – 2009 – 2012; 2014
      • Table 38 – Total number of DSLAMs – 2006 - 2014
      • Table 39 – Number of ADSL and ADSL2+-enabled exchanges – 2013 - 2014
      • Table 40 – Fibre Access Broadband (FAB) exchanges – Dec 2014
      • Table 41 – Top Hat enabled exchanges – 2011 - 2013
      • Table 42 – Broadband DSL retail subscribers by major provider – 2011 - 2014
      • Table 43 – Total business and residential broadband subscribers – 2006 - 2014
      • Table 44 – Telstra broadband subscribers by sector – 2007 – 2014
      • Table 45 – Cable broadband subscribers by major operator and annual change – 2002 - 2014
      • Table 46 – Cable subscribers versus other broadband technologies – 2009 - 2014
      • Table 47 – Optus financial data – 2011 - 2015
      • Table 48 – Optus financial data – 2011 – 2015
      • Table 49 – Optus financial data by sector – 2009 - 2015
      • Table 50 – Optus on-net broadband subscribers – 2009 - 2014
      • Table 51 – Business, government and household dial-up subscribers – 2009 - 2014
      • Table 52 – Business, government and household broadband subscribers – 2009 - 2014
      • Table 53 – Business, government and household total internet subscribers – 2009 - 2014
      • Table 54 – Business uptake of broadband by access type – 2010 - 2014
      • Table 55 – SME online trends – websites versus social media – 2010 - 2014
      • Table 56 – Historic - SME computer equipment ownership trends – 1999 - 2004
      • Table 57 – SME computer equipment ownership trends – 2005 - 2014
      • Table 58 – Computer hardware expenditure – SMEs and medium businesses – 2001 - 2014
      • Table 59 – Business trends in internet connections – 1998 - 2014
      • Table 60 – SMEs internet access methods, by technology – 2010 - 2014
      • Table 61 – Top uses of the internet by SMEs – 2010 - 2014
      • Table 62 – Business focus on digital engagement – 2014 - 2016
      • Table 63 – Expectations of customer e-payments – 2011 - 2012; 2015-17
      • Table 64 – Priorities driving business investments – 2014
      • Table 65 – Areas of future business investments – 2014 - 2016
      • Table 66 – Estimated telco product mix of business customer spend – 2014
      • Table 67 – Estimated business and government market spending – 2013
      • Table 68 – Revenue mix – total spend of telecoms – SME market – 2015
      • Table 69 – Revenue mix – total spend of telecoms – residential market – 2014
      • Table 70 – Historic - Total households versus internet enabled households – 1999 - 2004
      • Table 71 – Total households versus internet enabled households – 2005 - 2014
      • Table 72 – Broadband component of internet enabled households – 2005 - 2015
      • Table 73 – Proportion of internet households with children – 2005 - 2009; 2010 - 2013
      • Table 74 – Internet access households with children – 2005 - 2009; 2010 - 2013
      • Table 75 – Fixed-line broadband data usage by users – 2008 - 2014
      • Table 76 – Household/individual broadband connections – 2012 - 2014
      • Table 77 – Historic - Dial-up and broadband internet subscribers – 2003 - 2004
      • Table 78 – Dial-up and broadband internet subscribers – 2005 - 2014
      • Table 79 – Computerisation in the home – 2014
      • Table 80 – Proportion of the population using social networking sites – 2011 - 2015
      • Table 81 – Social network site users – 2012 - 2015
      • Table 82 – Top 5 online applications – 2013 - 2014
      • Table 83 – Use of internet applications – 2009 - 2014
      • Table 84 – New complaints to the TIO per 10,000 services in operation – 2013 - 2014
      • Table 85 – Total new complaints to the TIO – 2006 - 2014
      • Table 86 – Number of investigations by the TIO, by levels – 2009 - 2014
      • Table 87 – Homes connected to fibre – 2005 - 2010
      • Table 88 – NBN Cost per Premises – 2014
      • Chart 1 – Total broadband subscribers and annual change – 2005 - 2016
      • Chart 2 – Overview of broadband access revenues by major provider – 2005 - 2014
      • Chart 3 – Overview of annual change in broadband access revenues by major provider – 2006 - 2014
      • Chart 4 – Overview of market share of broadband access revenues by major provider – 2005 - 2014
      • Chart 5 – Overview of fixed broadband ARPUs – 2006 - 2015
      • Chart 6 – Proportion of internet subscribers by download speed – 2009 – 2014
      • Chart 7 – Internet subscribers by download speed – 2008 – 2014
      • Chart 8 – Terabytes of data downloaded by access technology (historic) – 2008 – 2014
      • Chart 9 – Overview of number of DSLAMs by top six providers – 2008 – 2012; 2014
      • Chart 10 – Overview of total business and residential broadband subscribers – 2006 - 2014
      • Chart 11 – Overview of cable broadband subscribers by operator and annual change – 2002 - 2014
      • Chart 12 – Overview of cable subscribers versus other broadband technologies – 2009 – 2014
      • Chart 13 – Business uptake of broadband by access type – 2010 – 2014
      • Chart 14 – Overview of SME computer equipment ownership trends by type – 2005 - 2014
      • Chart 15 – Overview of SME versus medium-sized business computer expenditure – 2005 - 2014
      • Chart 16 – Overview of households with internet access – 2004 - 2014
      • Chart 17 – Overview of the decline in dial-up subscriptions – 2004 - 2014
      • Chart 18 – Overview of new complaints to the TIO – 2006 - 2014
      • Chart 19 – Overview of consumer and SME complaints by level – 2009 - 2014
      • Exhibit 1 - Unbundled Local Loop Bitstream
      • Exhibit 2 – HFC network status
      • Exhibit 3 – Overview of the TIO complaint handling process
      • Exhibit 4 – Can grid power keep the internet alive?

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Number of pages 123

Status Archived

Last updated 10 Jun 2015
Update History

Lead Analyst: Henry Lancaster

Contributing Analysts:

Paul Budde

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