Fixed services
Telstra maintains its stranglehold on the wholesale market with revenues of just under $3 billion in 2007, which constituted just over 70% of the $4.2 billion wholesale market. The total 2nd tier market (including wholesale revenues) grew at around 8% in 2007 to $9.2 billion and we expect that the growth rate will drop slightly to around 6% in 2008 and then maintain this level moving into 2009. Growth is expected to subside over the next two years as Telstra is forced to begin a period of transformation and rationalisation that has already been evident in many European countries. Overall telecoms market growth is expected to drop to 4.1% by 2008 and 3.4% by 2009.
Fibre networks will significantly increase the quality and capacity of the infrastructure. They will allow sectors such healthcare, education and energy to utilise these networks for the delivery of high quality home services, such as video nursing services to monitor elderly people and hospital patients who have been discharged early from hospital.
Eventually the fibre network will be extended to homes and businesses, but in most situations this can be done on a demand basis. However, there is room for competition here and we have seen some cities and communities taking a leadership role. But for the time being most FttH projects are in new housing developments rather than in brownfield markets.
By 2015, the telecoms industry will grow from $34 billion to $72 billion. Increasingly new revenues will flow into the industry as companies continue to explore and develop the digital media opportunities that are becoming available over IP-based next generation telecommunications equipment, which will be carried over the expanding fibre networks.
Mobile services
Mobile communications is still a huge telecommunications powerhouse. The premium prices that the industry can charge are generating an ongoing flood of revenue into the industry. Furthermore, large parts of the 2G infrastructure have been written off and the spectrum on which these services are built has also long been written off. No wonder the industry have been so slow to move to the next stage, where, as happened in the fixed network, revenues will come from mobility applications.
3G is now making serious progress with more than 4 million users, led by Telstra's Next G network. Data traffic both over the 2G and 3G networks is currently going through the roof, fuelled by the capped price plans.
Both in 2G and 3G the major players remain the same: Telstra, Optus, Vodafone and Hutchison. Telstra is still leading the market, thanks to a very conservative strategy. They still have not introduced capped voice plans. Optus' revenues have been severely affected by the competition of 2005/06. Vodafone and Hutchison have been leading the competition, but Vodafone remains a marginal operation and there is continued speculation about the future of the Australian operation.
The growth in prepaid has slowed down. The players are attempting to rein in the advance of too much competition, which around the world is manifested in large numbers of customers moving to prepaid services.
Mobile data as it has been promoted to the market through portals with proprietary content continues to be more hype than reality; Premium SMS has been more successful than On-Deck services from the operators.
There has been some good progress in wireless broadband in regional Australia. The developments in South Australia, in particular, are very promising - these have been made possible by the financial assistance of both the Federal and State Governments.
Outside regional areas, progress has been slow. PBA (Commander) has stuck to its niche market approach and is selectively using wireless broadband in some of its business deployments. Unwired now has around 80,000 customers, but, although this is a significant figure, it is only a small percentage of the four million broadband users in Australia. The same applies to the Austar service in Wagga Wagga.
This report provides tables only for the Australian telecoms industry and are extracted from the source reports as listed here. The tables relating to specific companies cover both fixed-line and mobile/wireless operations. For details, commentary and analysis, see the company profiles source reports.
Data in this report is the latest available at the time of preparation and may not be for the current year.