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2008 Australia - Mobile Data and Content - The Wireless Broadband Explosion

For those needing high level strategic analysis and forecasts of Australia’s mobile data and content markets, as the market moves towards wireless broadband, this report identifies business opportunities, points out the hype and the pitfalls, and will be of assistance in making the right business decisions. It provides essential reading and gives in-depth information on: Competitive information on the market, the industry and the players; Overview of the real innovators in this market and what are they offering; Mobile data revenues, forecasts and analyses; SMS statistics and forecasts; and Premium Rate SMS; Examination of HSDPA and LTE technologies; Overview of mobile TV and m-commerce; Telemetry, location services and RFID; Mobile radio market; Wireless mobility market; Mobile media - products and services analyses.


Market shift from voice to data Mobile data traffic is soaring. This is due to the capped mobile data services now on offer in the market by Optus (Virgin Mobile), Vodafone and Hutchison ‘3’. By far the largest growth market will be in mobile email. With the benefit of uncapped prices customers will check their web mail more frequently and this will begin to effect SMS usage. Slowly but surely prices are coming down and opening up new mass markets.

In 2009 mobile broadband revenues could start to challenge SMS revenues and could reach the $1.5 billion threshold (this includes the hardware such as data cards, etc). Within this figure, we do include mobile media services such as ringtones, music, games, etc. The value of that segment has been growing very slowly over the last decade and within a year, the operators are already generating more revenue from basic mobile wireless access than they are from their mobile media portals.

Currently this is predominately complementary revenue for the mobile operators; however it is expected that over time this will balance out when the mass market starts to kick in. By that time this revenue will change from complimentary to substitution. Also broadband is less developed in Australia than in other developed countries. Thus there is a relatively better business case for mobile broadband in Australia than in other countries.

However, wireless mobile is still a very small proportion of this mobile data. BuddeComm estimated that in 2008 this was around 5% of this market. We also remain sceptical about predictions that wireless broadband could take over from fixed broadband over the next one to two years. Although prices have fallen over the last two years, this service still remains too expensive for the majority of the residential market. It certainly is taking off amongst the business market and the top-end of the residential market, particularly among professional people.

Also, it won’t be until IP-based Next Generation Mobile, based on more spectrum, becomes available, before we start seeing the development of mass market wireless broadband. While some relief is expected when Long-term evolution technologies become available, 4G which would have the bandwidth and the IP efficiencies is not expected until 2012-2015.

'Off deck' models developing Portals are rapidly proving to be a far too crude tool to play any role of significance in the rapidly emerging digital media market. Instead there is room for what we call value added infrastructure services, facilities and tools that allow customers to better manage their emails and transactions, as well as the management of other interactive services that are increasingly going to take place over the mobile networks.

Rather than operating their own portals, mobile content will move ‘off deck’ and the mobile operators will offer mobile payment facilities. They have a unique infrastructure in place that allows for micro payments, through Premium SMS, which is a key element that is still missing in the digital economy. In the end, structural changes will also be needed in the mobile industry in order to engage true content providers and media companies to independently offer their services over open mobile networks.

Value-added markets Activity in the mobile value-added market is kept artificially low because of the high charges that apply for such services. At this point in time, there is not sufficient spectrum available to allow for a more mass market development. Furthermore the current technologies are not optimised for data. End-to-end IP based technologies are required for that.

What this means is that for the time being the mobile data services will revenue wise stay rather static. Also portal based services will decline as customers will move more and more towards off deck services.

Business models for content providers remain shaky, with operators still charging a hefty 30-50% of revenues.

Key highlights:

  • BuddeComm remains puzzled and bewildered about the hype surrounding the iPhone, although it is currently no mass market product, nor is it likely to be in the foreseeable future. However, what Apple is teaching the industry, is that more marketing is needed to get this market moving.
  • The question remains as to whether HSDPA will ever reach its true mass market potential, or will LTE and later on 4G take that position in 2010-2012 and beyond. A rapid deployment of low cost data access packages will propel HSDPA right in front the debate. HSUPA+ and LTE have already started to arrive on the horizon.
  • The mobile radio market is set to boom. Motorola is making good progress with the rollout of its Zeon Digital based network in NSW, Queensland and Victoria, which is based on the TETRA standard.
  • Telstra’s Next G network is certainly one of the global mobile success stories. Not only has its rapid rollout been incredible, but also the way that it has serviced the market has been very successful.
  • The new market of broadband ‘mobility’ will further develop in an all-IP network infrastructure, linked to fixed and mobile personal devices, with high storage capacity and parallel processing. Data will move freely around this wireless grid, which of course, will also be linked into the fixed network.
  • A big growth market for mobile broadband will be IP Telemetry. One of the reasons for the request for more spectrum is the rapid growth in wireless machine-to-machine communications. This is seen as the fastest growing industry over the next decade. It is also fuelling the IPV6 debate as all these billions of devices will need an IP address. It is expected that WiMAX will play a significant role in this market.
  • There has been an enormous amount of hype about mobile TV but the reality is that very few people are prepared to pay the prices that the operators are charging for the service. The current technology, and more importantly its business models, don’t yet stack up.
  • As we have been predicting for some time, the PSMS market has begun to falter. The high cost of access has been a constant limiting factor for their further development. With capped mobile data prices we see a very rapid changeover from PSMS to off-deck services.
  • Key companies in the mobile advertising market are Blue Freeway, destra, Hyro, belong, Photon and Premium TV.
Data in this report is the latest available at the time of preparation and may not be for the current year.

1. The Market in 2008
1.1 Telstra is taking the mbile lead
1.2 Mbile bradband
1.3 Next Generatin Mbile (NGM)
1.4 Mbile cntent
1.5 The end f mbile prtals
1.6 ff deck services
1.7 IP telemetry
1.8 The handset market
1.9 Nkia music stre analysis
1.10 The Apple iPhne
2. Frecasts and Market Issues
2.1 2008 - year f mbile data
2.2 Issues, key trends and develpments
2.2.1 Mbile data usage trends
2.2.2 Premium netwrk, premium prices
2.2.3 Crazy Jhn’s t sell mbile data
2.2.4 4G develpments
2.2.5 Mbile value-added market stifled by high charges
2.3 Market analyses
2.3.1 Limitatins f HSDPA
2.3.2 Will WiMAX deliver?
2.3.3 Smart wireless devices
2.4 Future develpments
2.4.1 Service evlutin
2.4.2 Hw t mve frward?
2.5 Mbile TV
2.6 Market frecasts
2.6.1 The blurred statistics f mbile data
2.6.2 Unique business pprtunities
3. HSDPA
3.1 4G LTE and 3G HSPA at 42Mb/s
3.2 HSPA, HSDPA, HSUPA
3.3 Australia’s start with HSDPA
3.3.1 3G HSDPA steaming ahead
3.4 HSDPA develpments
3.4.1 Telstra
3.4.2 Hutchisn
3.4.3 Vdafne
3.4.4 ptus
3.4.5 Ericssn’s bradband activities using HSPA
3.4.6 Neutral bradband cnnectins fr HSDPA
3.4.7 HSPA threat t SMS - analysis
3.4.8 Vendr war - HSPA versus WiMAX - analysis
3.5 Study reveals psitive impact by Next G
3.6 Will HSPA break thrugh int the bradband market?
4. SMS - Stats and Frecasts
4.1 Statistical verviews
4.1.1 Mbile revenue
4.1.2 SMS usage
4.2 Market trends
4.2.1 SMS betting
4.2.2 SMS spam regulatin
4.2.3 SMS service fr peple with disabilities
4.2.4 The yuth market
4.2.5 SMS advertising
4.3 SMS services
4.3.1 Premium Rate SMS
4.3.2 Business SMS
4.3.3 Skype SMS
4.3.4 Australia - mbile data - MMS
5. Mbile TV
5.1 The market in 2007
5.2 Market analysis
5.2.1 The end f mbile TV
5.3 Majr players
5.3.1 Hutchisn’s 3
5.3.2 Vdafne
5.3.3 BigPnd mbile TV
5.3.4 ptus
5.3.5 Device driven develpments
5.3.6 Industry under pressure
5.4 Spectrum fr mbile bradcasting
5.4.1 TV Channels A and B fr digital services
5.5 Multimedia Bradcast Multicast Service (MBMS)
5.6 Key market 13-19 year lds
5.7 Digital Vide Bradcasting-Handheld (DVB-H)
5.7.1 verview
5.7.2 DVB-H trials
5.8 Telstra pulls ut f mvemedia trial
5.9 Analysis f vide-based mbile develpments
5.9.1 Mbile TV - are yu serius?
5.9.2 The future indeed is vide cmmunicatins
5.9.3 Mbile vide has been ver-hyped
5.9.4 Financial and technical limitatins
5.9.5 Cmpeting technlgies
5.9.6 Regulatin-driven cmpetitin
5.9.7 Checking market realities
5.10 Mbile TV and WiMAX culd be a gd match - analysis
6. M-Cmmerce
6.1 Frm m-marketing t m-payments
6.1.1 Mbile payments
6.2 Mbile banking
6.3 Mbile marketing
6.3.1 Residential applicatins based n permissin-based marketing
6.4 Mbile advertising
6.5 Mbile media
6.6 M-cmmerce develpments and frecasts
6.6.1 Wireless bradband
6.6.2 Business applicatins
6.6.3 SMS driven m-cmmerce an early cntender
6.7 ther develpments
6.7.1 Barcde readers n mbile phnes
7. Telemetry, Lcatin Services, RFID
7.1 The Internet f Things
7.2 Machine-t-machine transmissin
7.3 Telemetry
7.4 Radi Frequency Identificatin (RFID)
7.4.1 RFID - a business revlutin
7.4.2 Rapidly maturing technlgy
7.4.3 Develpments in Australia
7.4.4 RFID experimental licences
7.4.5 Industry assciatin
7.5 Telemetry statistics (traditinal market)
7.5.1 Utilities telemetering
7.5.2 Mbile-based telemetry
7.6 Lcatin-based services (LBS)
7.6.1 Mbile rigin lcatin indicatr and emergency
7.6.2 Develpments in the USA
7.6.3 Develpments in Australia
7.6.4 Seeker Wireless Pty Ltd
7.6.5 Intelligent Transprt Systems (ITS)
7.6.6 Cell bradcasting trial frm Seven Netwrk - 1998
7.6.7 Vdafne’s ‘My Vdafne’ service
7.6.8 Lcatin and navigatin frm Sensis
7.6.9 Mbile Lcatin Manager frm Telstra
7.6.10 ptus Z FindA
7.7 Car navigatin systems
7.7.1 Early results
7.7.2 Market gathered pace in 2007
7.7.3 Analysis
8. Mbile Radi Market
8.1 Bm has s far nt ccurred
8.2 Recent develpments
8.2.1 Telstra Vehicle Access Netwrk (VAN)
8.2.2 Mtrla’s dual-mde MTTRB radi system
8.2.3 Zen Digital Netwrk
8.2.4 The cllapse f Simc
8.3 Market statistics
8.4 The slw rad frm PMR and TMR t DMR
8.4.1 Intrductin
8.4.2 Trunked Mbile Radi (TMR)
8.4.3 Public Mbile Radi (PMR)
8.4.4 Spectrum licensing
8.5 The key standards
8.5.1 APC-25
8.5.2 Terrestrial Trunked Radi (TETRA)
8.6 Majr service prviders
8.6.1 CmGrup Australia
8.7 Emergency services rganisatins netwrks
8.7.1 New Suth Wales
8.7.2 Suth Australia
8.7.3 Western Australia
8.7.4 Queensland
8.7.5 Tasmania
8.7.6 Victria
9. Wireless Mbility Market verview
9.1 Mbile market
9.2 Mbility applicatins
9.3 The mve twards 4G
9.4 Persnal wireless bradband market analysis 2008
9.4.1 Business mdels mre imprtant than technlgies
9.4.2 Cmpetitin needed t change the mbile mdel
9.4.3 Will WiMAX deliver?
9.4.4 Nt being seen t be bred
9.4.5 Smart wireless devices
9.5 Mbile spectrum develpments
9.5.1 Allcatin f new spectrum
9.6 Mbility devices
9.6.1 The cmmunicatins market f tmrrw
9.6.2 Mre’s Law: strage, access, prcessing
9.6.3 Bringing the future back hme
9.7 Bluetth
9.7.1 verview
9.7.2 The technlgy has fund its place
9.7.3 bluepulse
9.8 802.16e frm Unwired
9.9 Ultra Wideband (UWB)
9.9.1 Develpments in Australia
9.9.2 Regulatry issues
10. Mbile Media
10.1 Mbile media pprtunities
10.1.1 The mst persnal cmmunicatin service
10.1.2 Users need t be in charge
10.1.3 New business mdels required
10.1.4 Industry cntrl needs t be changed int trust
10.1.5 pprtunities and challenges
10.1.6 Unleashing market innvatin
10.1.7 Separatin r partnerships?
10.1.8 Cnclusins
10.2 Revenues
10.2.1 Revenue frecast
10.3 Market analyses
10.3.1 The mbile cntent market in 2008
10.3.2 The market fr mbile digital media
10.3.3 A market still kept hstage - analysis
10.3.4 New marketing and distributin mdels
10.3.5 Premium Rate SMS (PSMS)
10.4 Prducts and services
10.4.1 ‘ff deck’ cntent
10.4.2 Mbile fraud
10.4.3 Ringtnes and wallpaper
10.4.4 Mbile email
10.4.5 Vting
10.4.6 Advertising
10.4.7 Mbile music
10.5 Premium rate SMS (PSMS)
10.5.1 The market in 2008
10.5.2 Key players
10.5.3 Premium SMS revenues
10.5.4 Market analysis
10.6 Prviders
10.6.1 Mbile peratrs
10.6.2 Service prviders
11. Glssary f Abbreviatins
Table 1 - Mbile data revenues by peratr - SMS and nn-SMS - 2007 - 2008
Table 2 - SMS grwth frecasts - 2003 - 2010
Table 3 - Telstra SMSs sent - 2001 - 2007
Table 4 - Telemetry devices - 1998; 2000; 2004
Table 5 - Telemetry market - vertical market share frecast
Table 6 - Industry pinin regarding cntrl f mbile cntent - 2007
Table 7 - Industry pinin n partnerships - 2007
Table 8 - Australian cntent market revenue - 2005 - 2008
Table 9 - Mbile cntent ARPU per custmer by peratr - 2007
Table 10 - Revenues PSMS market - 2004 - 2008
Table 11 - PSMS market share by peratr - 2007
Exhibit 1 - Mbile TV viewing minutes in USA and Australia
Exhibit 2 - Bradcast Australia DVB-H trials - 2005 - 2007
Exhibit 3 - Why mbile marketing wn’t wrk
Exhibit 4 - Service evlutin visin
Exhibit 5 - Zen Netwrk - key vertical markets targeted
Exhibit 6 - Three Services, ne Netwrk, ne Radi Device
Exhibit 7 - Tw-way radi market - 1990 - 2010
Exhibit 8 - Tw-way radi systems
Exhibit 9 - NSW Gvernment Radi Netwrk (GRN)
Exhibit 10 - The Suth Australian GRN
Exhibit 11 - Key issues fr mbility industry
Exhibit 12 - Bradcast Australia DVB-H trials - 2005 - 2007
Exhibit 13 - Bluetth user statistics
Exhibit 14 - Industry pinin regarding mbile pprtunities - 2007
Exhibit 15 - Media cmpanies are ready fr mbile business, but channel-specific requirements are a challenge fr them
Exhibit 16 - Mbile facts and figures
Exhibit 17 - What users want
Exhibit 18 - Key applicatins frm data pack users
Exhibit 19 - Revenue mix PSMS
Exhibit 20 - belng clients and partners
Exhibit 21 - belng mbile services

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