As two of Australia’s leading operators, Telstra and Vodafone Hutchinson Australia, release operational data on a half-yearly basis, we only have new data from Singapore Telecommunications’ Optus and data from the Australian Statistics Bureau for our Q312 report. As a result, we have not altered our mobile subscriber forecasts, but new data has led to changes to our broadband market forecast. At the end of Q112, we calculate that there were 29.891mn mobile subscribers in Australia, y-o-y growth of 5.1%. Driving this growth are gains in subscriber numbers by Telstra and Optus. Vodafone posted losses at the start of2012, and Q112 marks the operator’s fourth consecutive quarter of decline in subscriber numbers.

Market penetration stands at 131%. New technologies are set to drive market growth in the short term, as following Telstra’s LTE launch in September 2011, Optus has joined the fray, launching LTE services in selected areas in April 2012, with plans to expand to major cities during 2012 and into 2013. With 4G now a reality, both operators are also offering 4G-compatiable handsets and devices, and BMI expects that more will be launched during 2012. In terms of network development, Optus and Vodafone signed a binding MOU in May 2012 to extend their network sharing agreement, and this will see both operators invest AUD400,000 (US$405,505) in up to 500 new shared base station sites over the next four years.

In terms of broadband, the government’s ambitious National Broadband Network (NBN) project was put back on track in February 2012 when the Australian Competition and Consumer Commission accepted Telstra’s structural separation undertaking. In March 2012 the NBN Co released a new construction timetable to complete or begin laying fibre in areas comprising 3.5mn premises by June 2015. This timetable will enable the network to reach areas with 1.8mn homes by the next federal election – as long as political turmoil does not reignite, leading to early elections, as the leader of the opposition Tony Abbott opposes the NBN. There has been some M&A activity during the quarter. In April 2012, M2 Telecommunications acquired Primus Telecommunications for AUD192.4mn (US$199mn); while Indonesia’s Telkom is allegedly bidding for cable operator Pacnet, which offers internet services in Australia. These moves follow iiNet’s acquisition of Internode, in December 2011. Our mobile subscriber forecasts remain unchanged: BMI calculates that there will be 33.8mn mobile subscribers in Australia by 2016. We have raised our broadband subscriber forecasts, in the light of new data and now calculate that there will be 19.0mn broadband internet subscribers by 2016. The roll-out of the NBN will have an important role to play in making this figure a reality.

Q3 2012 Report of Australian Telecommunications

Published: July 2012                            No. of Pages: 106                         Price: US $ 1175

Table of Contents

Executive Summary 6
SWOT Analysis 7
Australia Mobile SWOT . 7
Australia Wireline SWOT . 8
Australia Political SWOT . 9
Australia Economic SWOT 9
Australia Business Environment SWOT . 10
Risk/Reward Ratings . 11
Table: Telecoms Sector – Internet – Historical Data & Forecasts 22
Market Data Analysis 23
Mobile Operator Data . 32
Table: Australia Mobile Market Overview 32
Table: Telstra 32
Table: Optus . 33
Table: Vodafone Hutchison Australia 35
Table: Selected NFC Developments, 2011 37
Table: Telstra Fixed-Line Call Traffic 47
Dial-up and Broadband Internet Subscriptions by Technology, June 2011 (%) 49
Table: Australian Broadband Market June 2010-Dec 2011 52
Regulatory Environment & Industry Developments 61
Australia: Regulatory Bodies And Their Responsibilities 61
Legislation And Market Liberalisation 63
Licensing And Spectrum . 65
Rural Development . 67
Regulatory Developments . 68
Competitive Landscape . 70
Key Players 70
Table: Key Players – Australian Telecoms Sector 70
Table: Selected Operator Financial Parameters 70
Company Monitor . 71
Samsung Electronics 71
Table: Samsung Electronics Financial Performance (KRWbn) . 71
Regional Telecommunications Penetration Overview 92
Fixed Line 92
Table: Regional Fixed-Line Penetration Overview 92
Mobile 93
Table: Regional Mobile Penetration Overview 93
Broadband 95
Table: Regional Broadband Penetration Overview 95
Demographic Outlook 96
Table: Australia”s Population By Age Group, 1990-2020 (”000) 97
Table: Australia”s Population By Age Group, 1990-2020 (% of total) 98
Table: Australia”s Key Population Ratios, 1990-2020 99
Table: Australia”s Rural And Urban Population, 1990-2020 99
Australia Telecommunications Report Q3 2012
© Business Monitor International Ltd Page 4
Glossary Of Terms 100
Table: Glossary Of Terms .100
BMI Methodology 101
How We Generate Our Industry Forecasts 101
Table: Key Indicators For Telecommunications Industry Forecasts 101
Telecoms Business Environment Ratings 103
Risk/Reward Ratings Methodology 103
Table: Ratings Indicators .104
Weighting 105
Table: Weighting Of Indicators 105
Sources 105Table: Telecoms Sector – Internet – Historical Data & Forecasts
Table: Australia Mobile Market Overview
Table: Telstra
Table: Optus
Table: Vodafone Hutchison Australia
Table: Selected NFC Developments
Table: Telstra FixedLine Call Traffic
Table: Australian Broadband Market June Dec
Table: Key Players – Australian Telecoms Sector
Table: Selected Operator Financial Parameters
Table: Samsung Electronics Financial Performance (KRWbn)
Table: Regional FixedLine Penetration Overview
Table: Regional Mobile Penetration Overview
Table: Regional Broadband Penetration Overview
Table: Australia”s Population By Age Group (”)
Table: Australia”s Population By Age Group (% of total)
Table: Australia”s Key Population Ratios
Table: Australia”s Rural And Urban Population
Table: Key Indicators For Telecommunications Industry Forecasts
Table: Ratings Indicators
Table: Weighting Of Indicators