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Australia - Telecoms Industry - Statistics and Forecasts

Stagnation in telecoms market set to continue in 2014

Revenues are stagnating

BuddeComm estimates that the overall telecoms services revenue passed was about $42.5 billion in 2013, slightly down on 2012 as a result of lower revenue from Vodafone and Optus. Indeed, growth has been subdued since 2011, largely due to competitive pressure on pricing among operators, as well as continuing economic uncertainty among some sectors of society which has lessened discretionary spend. This is expected to continue into 2014 and 2015, with revenue either stagnating all together or only slightly growing to about 1-1.5% annually. Most fixed-line and mobile voice services are now at levels where consumers would not tolerate price increases, so opportunities to drive increases in consumer and business expenditure in the short term are limited to mobile data services based on 4G/Long-term Evolution (LTE) technologies, fibre, and cloud-data housing.

At the same time as fixed-line telephony is declining, the mobile broadband market is growing steadily and is set to become a major income revenue stream for providers. Nevertheless, mobile broadband data revenue growth will be far short of the growth anticipated from mobile broadband data on networks. While mobile voice remains the dominant source of revenue for Mobile Network Operators (MNOs), it will soon be overtaken by mobile data revenue. In time, much of the voice traffic will be data packet via technologies such as Voice over Long-term Evolution (VoLTE). Data traffic caused network constraints on 3G networks over the last couple of years, since the infrastructure was not designed for the rapid increase of traffic, and so MNOs have had to invest in network upgrades to ensure that customers receive a reliable service.

The release of 4G/LTE mobile broadband and increased uptake by consumers and businesses will certainly ease the issue in the short term, but as user uptake increases so will the amount of bandwidth consumed. Mobile data usage increased by nearly 80% year-on-year to mid-2012 with nearly seven terabytes downloaded over the air in a three-month period.

Telstra continues to dominate the overall Australian telecom market with about 60% market share of overall revenue in 2013. This market share has been falling steadily since the highs that it held in the early 2000s, of around 80%.

The 2nd tier market

Developments in this market have been dominated by industry consolidation, a process that is set to continue over coming years. Moving towards a structurally separated regulatory environment with a NBN at the horizon, size really does matter.

The other important development has been Telstra’s aggressive activities to increase its market share, particularly in the mobile and broadband sectors. This has been detrimental to a number of 2nd tier players, as has been reflected in their declining revenue in 2013. Nevertheless, there was an overall recovery in total revenue among these players in 2013, reflecting the benefits of scale brought about by market consolidation. Overall revenue for these operators, of about $3.9 billion, still accounts for less than 10% of the total telecoms market in Australia.

This report provides an overview of some of the larger 2nd-tier market players with key revenue figures for the market with brief financial and operational overview on the companies with analysis and data provided in several formats including easy-to-read charts and tables.

Broadband

The NBN will become the predominant infrastructure, and as a utilities-based network it will also provide its services to other sectors, such as healthcare, education and business. With these sectors involved we will see the industry developing specific new business models around infrastructure, ICT and retail. IPTV and other media and entertainment applications will also begin to play a more important role. The question remains – how successful will the telcos be in retail space?

With the uncertainty over the NBN a key concern moving forward is how far operators should invest in DSLAM infrastructure: the National Broadband Network (NBN) structure initially would have rendered DSLAMs obsolete with Fibre-to-the-Premises (FttP) networks in place. However, with the NBN under a strategic review, and with the Coalition government determined to promote a Fibre-to-the-Node (FttN) architecture, supplemented by copper-based VDSL technologies, the transition from DSL to fibre-based infrastructure is likely to be on a far smaller scale.

Business broadband expansion continues with many individual employees now also being connected to mobile broadband, smartphones and tablets are increasingly becoming a part of the business ICT environment. Wireless broadband uptake by business has also seen an increase of numbers into 2013, while business with fast fibre spreads greater than 24Mb/s have seen a huge uptake over the past year.

This report also provides insight into a range of topics covering the usage of internet and broadband services in the residential sector, including overall statistics of the $19 billion residential telecoms market. It also includes BuddeComm estimates of the market as well as data from a number of market surveys covering consumer usage and behavioural patterns, in addition to internet and broadband usage statistics.

Mobile Market

Overall mobile services revenue growth by the MNOs over the last financial year has fallen year-on-year. We should expect to see slower revenue growth from Telstra and Optus into 2014, with revenue again negative for Vodafone. While the issues that saw Vodafone revenues slide are unique, the company will continue to be affected by the loss of subscribers, price competitiveness and the cost of investing in infrastructure as it struggles to compete in the LTE-arena.

The number of mobile subscribers continues to grow steadily, and by mid-2013 mobile penetration had reached more than 130% as a significant proportion of subscribers make use of multiple phones or SIM cards. While growth is likely to continue in the next few years in as subscribers take to smartphones, this will slow in line with higher penetration, being about 2% into 2014.

Telstra remains the market leader with more than 14 million subscribers, Optus has around 9.5 million subscribers, and Vodafone has seen subscriber number fall to just over three million.

In 2013 there are more than 5.5 billion mobile broadband subscribers. The release of additional 4G networks and increases in capital expenditure by the mobile network operators will see increased market penetration of the availability of these 4G/LTE networks. The MNOs will be expecting a greater return on their investments, but BuddeComm expects that uptake will slow down to an annual growth rate of around 3% with ARPU continually falling as market pricing drives uptake.

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


  • EXECUTIVE SUMMARY
  • TELECOMS MARKET MOVING INTO 2014
    • THE RAPIDLY SHRINKING TRADITIONAL TELECOMS MARKET
    • THE CLOUD COMPUTING REVOLUTION
    • THE CHANGING DATA CENTRE LANDSCAPE
    • THE RAPID GROWTH OF REGIONAL SECONDARY DATA CENTRES
    • M2M AND THE INTERNET OF THINGS
    • THE BANDWIDTH BANK
    • AUSTRALIA'S MVNO MARKET FEELING THE HEAT
    • OPTIMISING NETWORKS THROUGH CROWDSOURCING
  • MARKET AND INDUSTRY STATISTICS
    • STATISTICAL OVERVIEW OF THE TELECOMS MARKET - BY PROVIDER
      • Total telecommunications services market
        • Table Historic - Total telecoms revenues by major providers - 2000 - 2004
        • Table Total telecoms revenues by major providers - 2005 - 2013
        • Table Total telecoms service market share by major providers - 2003 - 2013
      • Telstra
        • Table Telstra Group total revenue and annual change - 2000 - 2013
        • Table Telstra Group revenue by service and annual change - 2011 - 2013
        • Table Telstra fixed telephony revenue and annual change - 2011 - 2015
        • Table Telstra PSTN products revenue and annual change - 2011 - 2012
        • Table Telstra mobile revenue and annual change - 2011 - 2013
        • Table Telstra fixed broadband revenue by service stream and annual change - 2011 - 2013
        • Table Telstra IP and data access revenue and annual change - 2011 - 2013
        • Table Telstra offshore controlled entities revenue and annual change - 2011 - 2013
      • Optus
        • Table Optus overall operating revenue summary and annual change - 2000 - 2013
        • Table Optus key financial indicators - 2009 - 2013
        • Table Optus operating revenue by operating division - 2011 - 2012
        • Table Optus revenue annual change, by sector - 2012 - 2013
        • Table Operational EBITDA by operating division - 2008 - 2013
        • Table Optus revenue by major and minor service category - 2011 - 2013
      • Vodafone Hutchison Australia
        • Table Vodafone Australia revenue - 2009 - 2013
        • Table HTA key metrics - financial overview - 2009 - 2013
        • Table Vodafone - subscribers by type - 2009 - 2013
      • Capital expenditure
        • Table Total capital expenditure by major network provider - 2009 - 2013
        • Table Annual change in total capital expenditure by major network provider - 2010 - 2013
    • STATISTICAL OVERVIEW OF THE TELECOMS MARKET - BY SERVICE
      • Total telco market by major service
        • Table Historic - Total telecoms market - retail revenue by service - 2001 - 2004
        • Table Total telecoms market - retail revenue by service - 2005 - 2014
        • Table Total telecoms market - annual retail growth by service - 2001 - 2014
        • Table historic - Total telecoms market - retail market share by service - 2000 - 2004
        • Table Total telecoms market - retail market share by service - 2005 - 2014
      • Wholesale market
        • Table Historic - Wholesale market revenues by major supplier - 2000 - 2004
        • Table Wholesale market revenues by major supplier - 2005 - 2014
        • Table Wholesale market shares - by major supplier - 2000 - 2014
        • Table Historic - Annual change in wholesale market revenues by major supplier - 2000 - 2004
        • Table Annual change in wholesale market revenues by major supplier - 2005 - 2014
      • Mobile market
        • Table Historic - Total mobile services market revenue and annual change - 2000 - 2004
        • Table Total mobile services market revenue and annual change - 2005 - 2014
        • Table Historic - Mobile market revenue per major operator - 1993 - 2004
        • Table Mobile market revenue per major operator - 2005 - 2014
        • Table Historic - Annual change of mobile market revenue per major operator - 1994; 1997; 2000 - 2004
        • Table Annual change of mobile market revenue per major operator - 2005 - 2014
        • Table Proportion of mobile service revenue from voice and data - 2007 - 2014
        • Table Blended ARPU per month per major operator - 2000 - 2014
        • Table Blended ARPU per month per major operator - annual change - 2004 - 2014
      • Broadband market
        • Table Broadband revenues by major provider - 2005 - 2013
        • Table Annual change in broadband access revenues by major provider - 2006 - 2013
        • Table Market share of internet access revenues (broadband and dial-up) by major provider - 2004 - 2014
    • 2ND TIER TELCOS - REVENUE STATISTICS
      • Service revenues and market shares
        • Table Estimated selected second-tier telco revenues by service - 2003 - 2009
        • Table Selected second-tier telco revenues by service - annual change - 2004 - 2009
        • Table Estimated selected second-tier telco revenues by service - 2010 - 2013
        • Table Selected second-tier telco revenues by service - annual change - 2010 - 2013
        • Table Second-tier telcos - revenue by provider - 2009 - 2013
        • Table Second-tier telcos - revenue by major provider - annual change - 2009 - 2013
        • Table Second-tier telcos - revenue by major provider - relative market shares - 2009 - 2013
        • Table Second-tier telcos - revenue by provider (historic) - 2004 - 2007
        • Table Second-tier telcos - revenue by major provider (historic) - relative market shares - 2004 - 2007
  • NATIONAL BROADBAND NETWORK - SURVEYS, STATISTICS AND FORECASTS
    • MARKET SURVEYS
      • FTTN modelling results
      • NBN speeds over 25Mbps
      • Broadband benefits for households
        • Table Benefits of broadband for households - a national framework
        • Table Scenarios - summary of benefits in 2020
      • Poll prefers FttP plan above FttN plan
      • Support for fast broadband via an NBN
      • Customers prepared to pay for higher speeds
      • NBN Business Readiness Survey - 2013
      • Research into the NBN first release sites
      • Stats and demographics for the 2012-2015 NBN footprint
    • INDUSTRY TRANSFORMATION
      • Introduction
      • Fixed infrastructure market
      • Wholesale market
      • The retail market
    • PENETRATION UPDATES AND FORECASTS
      • Early uptake indications
        • Table NBN take up rates first release sites (pre-sales indications)
      • Broadband access penetration forecasts
        • Table Broadband uptake* scenario forecasts - 2015; 2020 (household penetration)
    • THE MOBILE MARKET
    • THE DIGITAL ECONOMY - TRANS-SECTOR MARKET
      • Forecasts - 2015; 2020
      • The digital media market
    • BUSINESS MARKET SURVEY
      • NBN impact on industry output by 2020
        • Table Impacts of the NBN on industry output at 2020 (% change)
      • Summary of survey findings
    • BUSINESS MODELS AND MERGERS AND ACQUISITIONS (M&A)
      • Fixed market scenarios
      • Mobile market scenarios
  • BROADBAND MARKET
    • DSLMARKET
      • Brief overview of the NBN
      • Regulatory environment - analysis
        • Table Wholesale DSL pricing, per month per user - 2013 - 2014
      • DSL infrastructure
        • Table Number of infrastructure providers by number of ADSL-enabled exchanges - 2007 - 2008; 2010 - 2011
        • Table Number of ADSL broadband subscribers -2008 - 2013
        • Table Number of DSLAMs by major providers - 2009 - 2012
        • Table Total number of DSLAMs - 2006 - 2013
        • Table Number of ADSL and ADSL2+-enabled exchanges - 2013
        • Table Top Hat enabled exchanges - 2011 - 2013
      • Brief overview of broadband providers market
        • Table ISP customer satisfaction ratings of selected ISPs - 2010 - 2011
        • Table Broadband DSL retail subscribers by major provider - 2008 - 2012
        • Table Total business and residential broadband subscribers - 2006 - 2013
        • Table Telstra broadband subscribers by sector - 2007 - 2013
    • BUSINESS MARKET
      • Market trends
        • Table Business, government and household internet subscribers - 2009 - 2013
        • Table Business uptake of broadband by access type - 2010 - 2013
      • Business market surveys
        • Table SME online trends - websites versus social media - 2010 - 2012
        • Table Historic - SME computer equipment ownership trends - 1999 - 2004
        • Table SME computer equipment ownership trends - 2005 - 2012
        • Table Computer software and hardware expenditure - SMEs versus medium businesses - 2001 - 2012
        • Table Business trends in internet connections - 1998 - 2012
        • Table SMEs internet access methods, by technology - 2010 - 2012
        • Table Top 10 current uses of the internet by SMEs - 2010 - 2012
        • Table Meeting customer expectations using internet applications - 2011 - 2012; 2015
        • Table Expectations of customer e-payments - 2011 - 2012; 2015
      • Business customer expenditure on telecoms
        • Table Estimated telco product mix of business customer spend - 2013
        • Table Estimated business and government market spending - 2013
        • Table Providers' market share and revenue - 2013
        • Table Revenue mix - total spend of telecoms - SME market - 2013
    • RESIDENTIAL MARKET
      • Statistical overview residential market - total telecoms
        • Table Revenue mix - total spend of telecoms - residential market - 2013
        • Table Service providers' market share and revenue in the residential market - 2013
      • Internet household statistics
        • Table Historic - Total households versus internet enabled households - 1999 - 2004
        • Table Total households versus internet enabled households - 2005 - 2014
        • Table Broadband component of internet enabled households - 2005 - 2012; 2015
        • Table Internet access households with children - 2005 - 2009; 2010 - 2011
        • Table Time spent online, by age - June 2012
        • Table Frequency of internet use, by internet population - June 2012
      • Trends in the residential market
        • Table Fixed-line broadband data usage by users - 2008 - 2013
        • Table Fixed-line broadband data usage by users - 2012 - 2013
        • Table Historic - Dial-up and broadband internet subscribers - 2003 - 2004
        • Table Dial-up and broadband internet subscribers - 2005 - 2013
      • Household use of technology
        • Table Computerisation in the home - 2012
        • Table Top 5 social networking age groups - 2011 - 2012
      • Other residential market surveys
        • Table Total new complaints to the TIO - 2006 - 2013
        • Table Number of complaints to the TIO - by levels - 2009 - 2013
  • MOBILE COMMUNICATIONS MARKET
    • REVENUE OVERVIEW
      • Statistical sources
      • Total mobile services revenue and forecasts
        • Table Historic - Total mobile services market revenue and annual change - 1993 - 2004
        • Table Total mobile services market revenue and annual change - 2005 - 2014
      • Operator revenue statistics overview
        • Table VHA revenue- 2011 - 2013
        • Table Optus revenue - 2012 - 2013
        • Table Historic - Mobile market revenue per major operator - 1993 - 2004
        • Table Mobile market revenue per major operator - 2005 - 2014
        • Table Historic - Annual change of mobile market revenue per major operator - 1994; 1997; 2000 - 2004
        • Table Annual change of mobile market revenue per major operator - 2005 - 2014
        • Table Annual change of mobile market share per major operator - 2000 - 2014
        • Table Estimated proportion of mobile service revenue from services - 2007 - 2014
        • Table Total mobile voice revenue per major operator - 2007 - 2014
        • Table Mobile voice revenue as a proportion of total mobile services revenue - 2007 - 2015
        • Table Mobile data revenue per major operator - 2007 - 2014
        • Table Annual change in data revenue per major operator as a proportion of total mobile services revenue - 2008 - 2012
      • Average revenue per user (ARPU)
        • Table Blended monthly ARPU by MNO - 2000 - 2014
        • Table Annual change in blended monthly ARPU by MNO - 2004 - 2014
        • Table Postpaid ARPU per month - Telstra, Optus and Vodafone - 2004 - 2013
    • SUBSCRIBER STATISTICS
      • Statistical sources
      • Mobile subscriber statistics
        • Table Mobile market subscribers, penetration rate and annual change - 2000 - 2013
        • Table Historic - Mobile subscribers by carrier - 1993; 1997; 2000 - 2004
        • Table Mobile subscribers by carrier - 2005 - 2013
        • Table Historic - Annual change of mobile subscribers by carrier - 1995; 1997; 2000 - 2004
        • Table Annual change of mobile subscribers by carrier - 2005 - 2013
        • Table Mobile subscriber acquisition cost by carrier - 2009 - 2013
        • Table Historic - Mobile subscriber market share by carrier - 1993; 1997; 2000 - 2004
        • Table Mobile subscriber market share by carrier - 2005 - 2013
        • Table 3G mobile subscribers by carrier - 2003 - 2013
        • Table Annual change of 3G mobile subscribers by carrier - 2007 - 2013
        • Table Proportion of 3G mobile subscribers versus total subscribers by carrier - 2006 - 2013
        • Table 2G mobile subscribers by carrier - 2006 - 2013
        • Table Annual change of 2G mobile subscribers by carrier - 2006 - 2013
        • Table Prepaid subscribers by mobile network operator - 2006 - 2013
        • Table Prepaid subscribers market share by mobile network operator - 2006 - 2013
        • Table Number of mobile phone services in operation - prepaid and postpaid - 2006 - 2014
        • Table Wholesale subscribers - Telstra versus Optus - 2006 - 2013
    • MOBILE BROADBAND
      • Market overview and analysis
      • Mobile broadband market statistics
        • Table Wireless broadband subscribers by access type and annual change - 2007 - 2014
        • Table Mobile broadband subscribers by mobile network operator - 2007 - 2013
        • Table Mobile broadband subscriber growth - 2008 - 2013
        • Table Estimated mobile broadband data downloaded in Petabytes - 2007 - 2013; 2015
        • Table Estimated mobile broadband revenues and annual change - 2007 - 2014
        • Table Mobile broadband monthly ARPU - 2007 - 2014
        • Table Fixed wireless broadband subscribers by major operator - 2008 - 2013
      • Forecasts and other developments
        • Table Forecast mobile broadband and voice revenues - 2008; 2013; 2018
        • Table Worldwide mobile broadband subscriptions - 2010 - 2014
        • Table OECD mobile broadband subscriptions - 2011- 2012
        • Table Top ten OECD countries by terrestrial wireless broadband subscriptions - 2011 - 2012
      • Australia - mobile media - premium rate SMS (PSMS) portals and apps

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